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Real estate issue
Should they rent or buy?
SCHOOL TIES It irks Zuraski to pay her sizeable rent, but buying doesn’t seem to be in the cards until she finishes law school.HOUSE HUNTER
CHRISTINA ZURASKI
Renting in the Gold Coast and loving it, Zuraski, 26, says the hopping ’hood suits her busy lifestyle. After working all day downtown as an HR recruiter, she heads to class four nights a week at DePaul University’s College of Law, where she’s a second-year student.
Zuraski says it’s probably unrealistic for her to buy a place in the city (especially where she’s living now), but she hates throwing away $1,540 a month in rent. “The place I rent now was built the year I was born, and they haven’t made any updates since then. The bathroom vanity is falling apart and my kitchen is disgusting.” Not surprisingly, she tops her wish list with a condo that is either new construction or fully rehabbed. She also covets a covered parking spot and balcony.
Zuraski currently makes between $60,000 and $70,000 a year as a recruiter, but she works on contract, so there’s no guarantee of stable employment. She has a small nest egg between $2,000 and $3,000, but she wants to keep that money available in case of emergency. At 696, her credit score is considered good, but shortly after graduating law school next year, she’ll have to start paying off $80,000 in student loans
Expert opinions
Chaz Walters
“With 100 percent financing [no money down], she could probably only go up to a $250,000 purchase price. She could find a one-bedroom in the Gold Coast for that, but she’ll have to watch the assessments.” Walters warns that high-rise buildings—especially those with 24-hour doormen or swimming pools—have notoriously high monthly assessments.Gisella Tomasio
“There’s nothing wrong with renting now. When she becomes a lawyer, she’ll have a job with a better salary and more stability. Reassess the situation in two years. The way things are going, homes may be even lower in price [at that point] than they are today.”Judge Mathis
“While it is true that Christina is spending a lot of money on rent each month, purchasing a home seems like a bad idea for her. However, she should move to a cheaper location and with the difference she saves in rent, that could be used as a down payment for her own place in the future. My verdict is to wait.”VERDICT:
Time Out Chicago / Issue 160 : Mar 20–26, 2008
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PS? Chaz last nite was amayzing as usual. The bedroom was 500 degrees because of you telling me your real estates how you buy low and sell high. THAT IS WHY YEW R MY REALTOR
Chaz yew r uh dreamboat and can take me to eat at a fancy rettrarant anytime. Walter
At this market condition for long term i would suggest buying.
I'm a Realtor and find myself embarrassed by Chaz's advice. Low income? Buy. Huge debt? Buy. No savings? Buy. Seriously, Chaz, step away from the kool aid.
hey about telling the whole story Chaz? "With 100% financing he/she could afford a $_____ house. Of course, he/she would also a have to pay huge sums in yearly property taxes, monthly assessments, take on market risk that may bottom out down another 10-15% from here, leaving the buyer in $25-100k of debt should they be forced to sell. Which they likely will have to, because they have no savings. It's all good though, because I got paid a commission." ****ing sick slimeball
Lastly, in case anyone else was still listening to these idiots: Let's look at a 30yr amortizing loan. Which is what most people will get into (after this interest-only debacle anyway): lets say a 30yr 6% loan for $500k. You'll pay $3k monthly. $36k a year. After 5 years, you've paid about $180k. Of that $180, ~85% has been interest. You've paid off only about $30k of the house. Great way to become a home "owner", huh?
and Gisella -- as an advisor -- how about levelling with people? Why not tell them the difference between renting and "buying" (with no/little money down using a mortgage)? It's about as simple as this: when you rent, you pay someone for the use of their property; when you "buy" with a mortgage, you pay some one for the use of their money. You're not an "owner" with no money down. Not even with 20% down. Oh, and also, when you buy you take market risk and pay huge taxes/assessments
Chaz says: "With 100% financing, he/she could afford a $______ house"
let's see.... "no money down" is a recommendation - with no disclaimer - just as long as Chaz gets paid. if your subjects take that advice there's a chance each of them will not get out of debt for decades.
It's nice to see that TimeOut has learned nothing in the last few years. (and that Chaz from the billboards is as big of a slime-ball as I always thought he'd be)
Great - ask a real estate agent (who makes something like 5% of the purchase price) if someone should buy or rent - no chance of a bias there!