[Gofishus]

I plan to graduate in two years with a minimal or no student debt. I have a good credit rating. I plan to live in a big city for 2 to 5 years after I graduate but planning to move elsewhere in the long run. Is it better for me to rent an apartment while saving up money to buy another place or to buy a condo, sell it, then move to another place?

[luudacris]

Duke it out with rent right now and then when you graduate....get a stable job, invest in a condo. Make sure it's in a nice area so the property value can go up. After you finish paying for it, rent it out instead of selling it. You'll be making money off the property that could go to your next place.

[Temoin la Nuit]

Rent to maximize cash flow and geographical mobility.

A huge mortgage right out of school is a sure-fire way to over-concentrate into one asset class.

I don't believe in buying a house as a financial investment. It's hugely popular "common sense" nowadays, especially with all the banks putting out pamphlets about "why rent when you can own?".

Of course, they're the ones making money off of your mortgage, so the advice isn't exactly impartial.

[Hax]

If your intention is not to stay, just rent. With a condo, you will be paying for rent and a home owners association fee. Pocket the home owners association fee and save it up for when you select your final city.

[sethsegel]

There are definitely pros and cons to both.

Apartments pro's are that you pay your rent and get a pretty comfortable living situation without involving loans/debts incurred.

Con's are that you're not paying towards any sort of ownership.

Condo pro's are that the money you put into it DOES go towards ownership, you're more free to do with what you want inside.

The con's though, are that you have to bend to the will of the condominium group. If they vote on something and its majority win, you have no choice but to go along with it.

[Pogichinoy]

Depends where you are in your life. If you're ready to settle down in that city then by all means, buy one. But if you have intentions to be nomadic, jump to a new position or city every year or so, and/or travel, then renting is best for you.

[sasuke-kun]

i bought. 8000 tax credit. 100k under original price (even though it was inflated). didnt really buy for investment purposes. it would be nice if i could make some money later on. just wanted my own place.

first thing is first, you need a stable job.

[aznkc]

if your parents are loaded and are gonna down payment or even buy the condo then go for it and when u move out u can also rent it out.

[pandibeari]

i agree with the first responder. rent until you graduate, then (if you can cover the down payment), buy a condo in a good area (this is key!) and sell it when you'd like to move. 2-5 years after you graduate the economy will have turned a bit and people will be buying again. renting, to me, is just wasting money. even though when you buy a condo you're taking out a loan (likely) and the bank is the one making the most money off of it (somewhat true), you still benefit from it. if you can get a deal where the monthly loan payment would be equal or less than what a rent payment would be (and you have the money saved up for a down payment), go for it. you'll get your money back when you sell it (vs lose everything you paid out when you move from your apartment).

one thing to keep in mind: if you get a cheaper condo (in a good area) to begin with, you'll have a higher return on your investment. if you like improving things and are handy with tools, get a fixer upper and you're return is bound to be good (although it won't be as astronomical as the returns people were getting during the housing boom).

good luck! you still have 2 some years to ponder it over

[missxmoody]

If you have the 20% down and will be able to afford the maintenance, home owners fees, and the TAXES .. go for it! Then again like someone else said wait until you graduate and see how the economy and real estate market is going. Nothing wrong with saving up the money either way.

I can't afford any one those so for now I'm going to just deal with my $1600/month rent. Sigh.

[Tuffcore]

It seems like a good time to buy right now since real estate is bottoming so if you have enough money, then that's the route to go. In 2 to 5 years when you decide to move, you can sell the home for capital gains assuming the economy recovers by that time (which it probably will.) It's just that while you own the home and pay mortgage, you may be cash strapped for other stuff.

[Hax]

I'm not sure where everyone lives but in the los angeles area, home owner association fees are like 500-800. granted the condos are in nice areas but that's extra money you have to pay ontop of your mortgage. hefty!

[Gofishus]

i agree with the first responder. rent until you graduate, then (if you can cover the down payment), buy a condo in a good area (this is key!) and sell it when you'd like to move. 2-5 years after you graduate the economy will have turned a bit and people will be buying again. renting, to me, is just wasting money. even though when you buy a condo you're taking out a loan (likely) and the bank is the one making the most money off of it (somewhat true), you still benefit from it. if you can get a deal where the monthly loan payment would be equal or less than what a rent payment would be (and you have the money saved up for a down payment), go for it. you'll get your money back when you sell it (vs lose everything you paid out when you move from your apartment).

one thing to keep in mind: if you get a cheaper condo (in a good area) to begin with, you'll have a higher return on your investment. if you like improving things and are handy with tools, get a fixer upper and you're return is bound to be good (although it won't be as astronomical as the returns people were getting during the housing boom).

good luck! you still have 2 some years to ponder it over

Thanks for the help everyone. This post was especially informative, and I intend to take your advice...hopefully thats the way things will unfold. =)

[love09]

You should buy a condo and invest in it. In 2 to 5 years you are staying, the price of the condo will increase. When you sell your condo and move to another place, you will make a huge profit off of it. It's like buying a house. My parents would buy it for 600,000 and then in the next two years it increased to 1,000,000 making a profit of 400,000. Think in the long term instead of the short term. Right now the economy is bad so the prices of the condo should be decreasing/low. It is a good time to buy. When the economy increases in the next couple of years, your condo should increase to. Why get an apartment? You don't make money, you lose money, you get no privacy, the space is less, the monthly payment is not that big of a difference, etc. Think smart. Why do you think all the millionaire's out there are rich? They invest in real estate. In real estate, they always say "location, location, location." When you buy a condo, make sure you find a good place.

[Hax]

^Are you factoring in homeowners association fee? If you are in a big city, your home owners association fee may be 500-800 bucks ontop of your monthly payments. I've seen lower in the 200-300s but even that much is nearly enough to make the difference pretty significant.

[juicejuice]

Buying condo isn't a bad idea in Toronto, but after 5 years it is best to sell the condo since its no longer "new" anymore and everything else that comes along with it becomes expensive (maintenance fees and so on) Condos only goes up to a certain value unlike a house. Renting is good if you are looking into saving money and buying a house, however if renting and the mortgage are roughly the same, you might as well get the condo instead.