12.13.08
Frustration
Now I have to write down my frustration a bit.
As you know we (me and Anthony) wants to live in a house, and we have had plans to buy one or even build one. Now this is very expensive where we live. We have many questions unanswered, like, will we want to stay in this region, should we buy now or later, should we first buy a flat and then a house etc.
One and a half year ago we started to visit different lands, I showed some of them here in my blog. Then the market began to stabilize, and now finally it’s going down a little bit.
Some months ago, when we realized the market was beginning to go down we decided that we would try to buy a house or land one year from now. That way the prices have time to go down, and we have time to save a little bit more, and to be more sure we want to stay here.
Another affect of the crisis is that we are very happy to have stable jobs. We see how contractors are put out, Amadeus is firing lots of them, and how it gets harder to get jobs in general. It make us think that in our situation, with maybe a family in some years, it’s not the best time to quit jobs to find new, less stable ones, in another region, maybe in a smaller, more risky company. Even if the house prises would be lower, with one or both of us without jobs we would not get very far.
So, ok we’ll probably stay here.
Quiet some time ago, we applied/told we were interested in buying one of a set of new apartments built between where we live and where we work. The situation is perfect with 10 minutes bike in forest to work, forest all around, south position, a small but nice view on a small golf court. The appartments are built by Valbonne, and sold to a price lower than market to people working in sophia (which is part of Valbonne). We were told that priority were given to people with less income and we were too far back in the list to have a chance.
Yesterday they called Anthony telling that we had a chance to buy a three room, or even a four room appartment, available in september 2009. The tree room appartment is 75m2 and have a balcony of 25m2, price 310 000Eur. The four room for a bit over 400 000. Three rooms would be enough for us.
Anthony was from the beginning attracted by those appartments, the situation and the thought of for quiet cheep have something completely new where we could decide everything inside. And in contrast I have always been sceptic, now when I’ve tried the life on the country side with a garden, all is silent around, plus how nice we have it here with walking distance to Valbonne Village etc. I have a hard time seeing me live in a flat.
So, we did some calculation with three scenarios:
1) Bying flat now, then five years later a house (meaning either house, or land and constructing a house). (Another parenthesis here is that if you didn’t know, me and Anthony are very lucky people who will be able to put close to 200 000 in a loan, from savings and help of parents). We would first take a loan of 5 years for the flat (the one for 310 000), then buy a house for 500 000 (land 300 000, house 200 000), taking a loan of 10 years. So after 15 years of loan we would own a house of 500 000 and we would have payed 83 000 to the bank. Pas mal!
2) Bying a house now (land 240 000, house 200 000). Well, we would need a loan of 20 years and in the end we would have payed 170 000 to the bank. Note also that the house itself would be ‘only’ worth 440 000.
3) Staying here 5 years (to compare it to the first scenario, in reality it would rather be three years or until a baby made it too hard to stay here…). Say we would buy the same thing as in the first scenario, a house for 500 000. Then we would have ‘lost’ 101 000: 39 000 in rents the five years, and 62 000 for a ten year loan. 15 years in total to be free.
You see… we have a small problem. How to decide. Following my heart I would go for scenario number two. I want to build now, I don’t want to build a house when having a baby. And I DON’T want to spend 5 years of my life in a flat. I just don’t want. But is that worth 100 000 that we would loose? Don’t know.
Please help!