I’ve done a small bit of financial organization this year. Now that the market has “cooled” here in the Bay Area, I would like to own a litte casa of my own. Just a small place for me and the cats to settle in.
Being the planner that I am, I went to a mortgage broker to pre-qualify, so I would know what I can search for/afford. Well, guess what? A) I dont make as much money as I have in the past, and b) The reporting laws on rental properties has changed. I CANNOT even afford to live in Little Mexico next to the freeway. Thats right. Thanks to all the folks who did zero down on multiple properties, they have changed the way they “estimate” a lendees income and expenses on rental properties… In addition, my income has gone down the last 2 years… I’ve not made much money (took a pay cut for upside opportunities at the new company… which has never panned out).
This happened last Wednesday, and I’ve been stewing about it ever since. I’m frustrated for several reasons:
- That I dont have enough income to qualify for more than a fixer upper in a bad neighborhood.
- That a break-even rental property would hinder my ability to purchase a primary residence (on that I put 20% down on and still shows its worth more than is owed on it).
I am a responsible person with very little debt, and I CANNOT afford to purchase a condo, much less a townhouse, and I can completely forget owning a home …. unless, of course, i want to live in a unsafe neighborhood just mere blocks from the freeway. Check this out, one of the few houses in my price range: http://www.redfin.com/CA/San-Mateo/205-S-Humboldt-St-94401/home/1675784
Yes, I have considered moving to an area where housing costs are more reasonable, but given the divorce, I really want/need to be close to my friends. Otherwise, I would literally NEVER get out of the house. So my choices are to continue to rent in an area that I feel safe and is close to my friends, OR if I want to own, I will have to move out of the Bay Area entirely. Bums me out that there is no in-between. I’ve had a bit of a pity party these last few days about it….
I’m cranky… really cranky about it. but I’ll find a way to fix it. Even if it means continue to rent for another year and save more money, selling the rental property in a down market. I’m still looking at options right now… these are two potential ideas that are not that appealing.