New house or New car?
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Joined: Jun 2002
Posts: 4,096
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From: SF Bay Area
I'm with the others - go for the house. Later on you can take out an equity loan to buy a car.
That having been said, I must admit that I didn't take my own advice. I'm 25 and went with the car. Part of the reason for this is that I'm paying for private grad school, and it's eating up too much of my money for me to afford a house. Of course, part of it is also because I wanted the car now and have the rest of my life to buy a house.
Make a wise financial choice, but you only live once, so if you really, really want the car, then don't throw away the present in exchange for the future.
That having been said, I must admit that I didn't take my own advice. I'm 25 and went with the car. Part of the reason for this is that I'm paying for private grad school, and it's eating up too much of my money for me to afford a house. Of course, part of it is also because I wanted the car now and have the rest of my life to buy a house.
Make a wise financial choice, but you only live once, so if you really, really want the car, then don't throw away the present in exchange for the future.
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Joined: Nov 2001
Posts: 1,809
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From: Southern Part of Heaven
Definitely a house. Here's my experience: I am 27 y.o. My wife and I bought a little 2BR condo in Arlington, VA a year and a half ago for $240K. We bought the place a year after graduating from graduate school. The place was a real fixer-upper, and I guesstimate that we spent $30-40K on improvements (it would have been a lot worse had we not done most of the work ourselves). Today, 2BR condos in our neighborhood go for about $400K. So, we will be looking to trade up to a house in a couple of years and likely seeing about $180K from the sale of our condo. Granted, that is not all profit, as we put 5% down and spent $ on improvements, but owning the place forced us to spend the $ on the condo, rather than pissing it away on who knows what else. Also, our experience may be a little unique since the cost of living in Washington, DC, and our neighborhood in particular, has just skyrocketed in the last 18 months, and we got a good deal on the initial purchase and fixed the place up very nicely. But, the bottom line is that real estate is an investment that is likely to appreciate in most markets. I think buying real estate as early as possible is usually a great idea.
Been paying rent for 3 years too long!