… boy does it wander.
The post that was published yesterday was actually written a week ago. Since I put that budget together, a few things have changed. I have found out that $150 for Personal Spending was too low and upped it to $300. That wasn’t so hard…
But that high rental cost really bothered me. I kept on thinking about it. Then the toilet leaked. This is the second time in the last 6 months that it has happened. The condo was built 10 years ago and 10 years is about the time when the appliances begin to fall apart. The landlord pays for the plumber but it always means some damage (however small) to my items and annoyance of working from home to meet with the plumber, etc.
That made me begin to wonder if it was worth it. Out of pure curiosity, I started to look at the condos available for sale in my neighborhood. I saw units that were nicer than mine obtainable with monthly mortgages less than my current rent. Then I became obsessed.
I always wanted to own some rental properties in my investment portfolio. Since there are numerous tax breaks for your primary residence, I always thought I’d live in a property for two years, make whatever changes needed to increase the value, then rent it out. I thought that I’d begin looking maybe in a year or two, but the real estate market in Chicago finally seems to be picking up and I am expecting the prices to start to rise.
Conclusion? Now I am shopping for my very first property. I have been preapproved by a bank, have started to work with a realtor, and have identified target neighborhoods. The assumptions the mortgage lender and I used is to keep my monthly mortgage+tax+insurance the close as possible to my rent. Now the tough part is waiting for the “perfect” property for me to become available and not get caught up in the outside activities (investors snatching up properties before I have a chance) and let that rush me into something that is not “perfect”.
This also means I need to redo my budget ASAP. Even though the mortgage preapproval was very favorable, I want to have enough cash to make any updates, especially if I end up purchasing a fixer upper (preferred). I already have taken some actions to reduce the future expenditures and to increase income, which will all hopefully increase my savings. I will share some of those activities with you tomorrow.