P
ay Dirt – Money advice column
Questions? Email Kristin & Ilyce anonymously.
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**Reader:**
My husband and I live in a very high‑cost city. I’m currently unemployed in a competitive field, but I have several promising prospects that may materialize in the next few months. He earns a modest six‑figure salary that covers our living expenses and a special‑needs pet. He’s fed up with renting, calling it “paying someone else’s mortgage,” and wants us to buy a home. His family offered to help with a down payment, but never gave a concrete amount. We’ve heard about first‑time‑homeowner programs in the area, but none of our friends have used them in recent years. I’ll meet with a couple of lenders my agent suggested to learn more. Is buying a house right now a terrible idea? How can I convince him that renting isn’t just throwing money away and that taking on a mortgage without solid prospects is a mistake?
**Answer:**
Buying a home isn’t automatically a bad move, but neither is renting. Renting gives you a place to live and frees you from mortgage payments, property taxes, and maintenance costs. However, you should weigh the *opportunity cost*: the money you’d put toward a down payment could be invested in a diversified index fund that historically returns 6‑7 % per year, while real‑estate gains often lag inflation.
Consider the timing and market conditions. If home prices in your area are poised to rise, buying could lock in a lower price. Use a detailed rent‑vs‑buy calculator that factors in taxes, insurance, maintenance, and potential appreciation.
If you decide to buy, make sure you have a sizable emergency fund (ideally 6‑12 months of expenses) and that the mortgage payment fits comfortably within your budget, especially given your uncertain employment prospects. Ask your in‑laws how much they’re willing to contribute; that figure will shape the size of the down payment and the loan amount.
In short, renting isn’t a waste of money, but buying can be a sound investment if you’re financially prepared and the market is favorable. If you’re unsure, continue renting while you build savings and improve your job prospects.
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**Reader:**
I’m not a real‑estate agent. My cousin’s spouse just got surgery approval at a major hospital in our city. They’ll need to stay for a few months and want a dog‑friendly one‑bedroom with no stairs, a backyard, direct transit, near the hospital, and under $2,000 a month. The average one‑bedroom rents $5,000. I’ve shown them data and suggested compromises, but they’re angry that I’m “not even trying.” I want to help without burning bridges. How do I set boundaries and keep the relationship intact?
**Answer:**
You’re doing the right thing by being honest about your limits. Tell them plainly that you’re not a real‑estate professional and that you can’t guarantee a rental that meets all their criteria. Offer to help them search online or contact a local agent, but make it clear that you’re not responsible for the outcome. If they’re upset, remind them that you’re supporting them emotionally and that you’ll stay in touch, but you can’t shoulder the entire housing search. This approach preserves the relationship while protecting you from becoming a doormat.
