Originally Posted by 94 Daily Driven 4.6L
Home ownership (real estate) is probably the best investment anyone can do with his or her money.
Yes and no. From the sound of it, they're not buying an investment house, just a place to live. The market is slowing, really fast. The over inflated house prices will drop now that interest is coming up. People in CA are now waiting months to sell a house that would have sold in days 6 months ago.
On the decision, don't buy either, unless you need something now. Neither house is exactly what you want. Keep looking. When we were looking for our house, it was between a 1450 sq ft house on 1/2 acre in town for a good price that was in need of $1000 in repair and hadn't been redecorated (lighting, wall paper, carpet etc) since it was built in the 50's. The other house was 1984, cost twice as much, 3000 sq ft, 850 sq ft guest house (not livable), 30x20 barn, 2.8 acres, wooded area just outside of town with an extra 10 minutes of driving to work.
Cost, location, value, willingness to work on it, resale value, enjoyment factor:
Older house: if I bought it, would have spent about $10k fixing it up, could have paid it off in 6 years, be in great financial shape. Be looking for a new house in a year or two. Could sell it for a $25k profit nownow
New house: Have spent $35k+ fixing it up. 26 piers later, the foundation is in worse shape than before, still has a 20x15 foot mural that belongs in a mexican restaurant. It appraised at $50k over the cost the year after we bought it. (efforts paid off) Everyone that comes over is astounded at how good it looks. I'm a step from broke at all times.
I still feel we made the right decision.
Find the one that you really want, just don't tell the sellers you do.