{"id":47452,"date":"2010-10-05T04:00:36","date_gmt":"2010-10-05T11:00:36","guid":{"rendered":"http:\/\/getrichslowly.org\/blog\/?p=47452"},"modified":"2019-08-08T20:52:20","modified_gmt":"2019-08-09T03:52:20","slug":"moving-rent-first-ask-questions-later","status":"publish","type":"post","link":"https:\/\/www.getrichslowly.org\/moving-rent-first-ask-questions-later\/","title":{"rendered":"Moving? Rent first, ask questions later"},"content":{"rendered":"

This is a guest-post from Tim Ellis<\/b>, author of Seattle Bubble<\/a>, a blog and forum dedicated to discussing real estate market conditions in the Seattle area. Tim is a long-time GRS reader. During my last trip to Europe, he shared a controversial article on renting vs. buying<\/b><\/a>.<\/i><\/p>\n

Given the fact that each year around sixteen million Americans move to a new county<\/a>, it’s likely that at some point in your life you’ll find yourself moving to an unfamiliar area.<\/p>\n

Starting a new chapter of your life in a fresh locale can be an exciting and memorable time, but it can also be rough on your personal finances. Many of the expenses associated with a major move are unavoidable, but there’s one major mistake that is easy to avoid: buying a home immediately upon arriving.<\/p>\n

Maybe you’re tired of renting and homes are a lot cheaper where you’re going, or maybe you own a home in your old city and feel like it would be a financial defeat to go back to renting.<\/p>\n

In reality, starting by renting when you move to a new city is anything but defeat<\/b>. It’s actually the smartest decision you can make, both for your sanity and your bank account.<\/p>\n

<\/span>A Real World Example<\/span><\/h2>\n

In early 2007, a new employee (we’ll call him Ben) was hired to my team at work. Fresh from the midwest, Ben and his wife had owned a home in their old city, and were anxious to buy as soon as they moved to Seattle. I urged Ben to hold off, rent for a while, and get to know the area before making that level of commitment, but they decided to buy a home in a quiet suburban neighborhood north of Seattle.<\/p>\n

Fast-forward to 2010: Ben and his wife have realized that the quiet suburban life isn’t their style. They would rather live closer to the city. Unfortunately, their home has depreciated so much that their entire 20% down payment is gone, and they would likely have to come to the closing table with a check for tens of thousands of dollars to sell their home.<\/p>\n

Ben and his wife would like to move to a neighborhood that better suits their lifestyle, but now they’re stuck in a neighborhood they don’t really like until the housing market recovers.<\/p>\n

<\/span>Avoid the Lure of the New-Car Smell<\/span><\/h2>\n

Everyone understands and accepts that when you buy a new car, it loses twenty percent of its value<\/a> the moment you drive it off the lot. Buying a home (used or new) is similar. Even if home prices begin to appreciate regularly again, agent fees, excise taxes, staging, seller concessions, and other random costs add up quickly when you try to sell your home, sucking away about ten percent of the sale price.<\/p>\n

There really is no way to know what neighborhood will work best for you until you’ve spent a good amount of time actually living in the area.<\/b> Consider all the variables at play:<\/p>\n