Dear Monty: I live in the Washington, D.C., area, where home prices are always higher than in other parts of the country, and I hope to move closer to the city. I work as a freelancer and have about $150,000 saved up. I think I will have to get a modest condo if I buy now. Suppose I move farther away from the city or have a bunch of roommates or renters. Single-family homes around here are typically $600,000 to $1,000,000, and even townhouses are like $500,000.
I might find getting a mortgage hard because I'm a freelancer. I'm currently not paying rent, but I'm 39 and want to own my own place. Would it be better to get the modest condo (which I might not like) now before prices and interest rates go up? Or should I keep saving (despite my less-than-optimal yet affordable living situation) until I can afford the more expensive house? What about buying a place where I might be somewhat overextending my resources and then renting out the basement (or living in the basement and renting out the rest)? I don't have prior experience with real estate, so I don't have that much of a sense of how feasible or risky that would be for me.
Information SourcesNo. 1: There are many methods to gain real estate knowledge quickly. Check out online bookstores like Barnes & Noble or Powell's Books. There are free online websites like Khan Academy or Dear Monty. An internet search for first-time homebuyer classes in D.C. will reveal many options.
No. 2: Type "mortgage lenders with no W-2 requirements" into the search bar, and many options appear.
No. 3: You did not mention fractional ownership, but Supermoney.com reviews several companies that offer fractional ownership.
No. 4: Bankrate.com explains rent-to-own and covers the pros and cons for both buyer and seller.
No. 5: Airbnb.com is a site that offers renters accommodations around the world. D.C. is likely a location tourists want to see where hotel rooms are costly. Using a property manager to handle Airbnb details could address your roommate question.
Not all sources of real estate information are accurate. There is less-than-optimal data in books, websites and magazine articles. Often, data is misleading or even wrong. Some authors have significant conflicts of interest, are inexperienced or are collecting fees when you click on their published links. Look for sites that disclose link compensation. Dear Monty does not accept or pay fees of any kind.