Housing questions

[PubBurgers]

Hey guys, first post but i've been lurking around for a while. Love the forum, so much info!

Like a lot of people do, my wife and I failed to heed everyone's advice and had accrued about $15,000 in credit card debt. On top of this, my current job is a less than stellar place. Having only a High School Diploma and a couple years of random college classes under my belt, my options are pretty limited. We make about $2,000 a month between us and were paying just the minimums on the cards every month.

For whatever reason, be it having our first child (he's 8 months old now) or realizing we were more or less stuck in a rut, we decided we wanted to live more simply.

We started paying down the cards in August ,we had 4, two are now paid off, one will be very soon, and the last hopefully by the end of the year. A lot of the money so far has come from selling the amazing amount of crap we (mostly I) had accrued over the years. To say that i was addicted to the consumerist lifestyle is an understatement. While there's still plenty to clean out, it already feel's great to get rid of the clutter that i'll never miss and make progress on our cards.

We both grew up in the country and have only been in the city for about 5 years (I'm 24, wife is 25). We're now ready to get back to the country.

So now for the questions, the goal is to do this for as little money as possible (isn't it always?). I've worked out a few scenarios and was wondering if anyone with experience could chime in.

First up is our current house. We bought it in 2005 when banks were just throwing money at people. We payed $74K, after the housing market crashed and burned it's now worth $50K-$60K, we owe $68K. It's a pretty basic starter house in an OK neighborhood on a whopping .15 acres. Once the cards are paid off we need to pay on the house till we're at least on even ground. The house needs some minor work, such as carpet, minor plumbing and electrical work, and the like. Think it would be easier to pay it down to a bit under market value and sell "as-is" or spend the money to fix it up and still sell at a loss?

We also have a few possible scenarios for when we go to buy we wouldn't mind some input on.

We could probably spend up to about $100K on a traditional, niceish house on some land. Problem is it's also the most expensive route.

Lately we've been looking at manufactured homes on land. I have ZERO experience with manufactured homes. If we went this route we would eventually like to build our own house on the land and live in the manufactured till then. Plus is that manufactured homes seem to be substantially cheaper. Anyone have any experience living in one for a few years? Pros? Cons?

Third option would be to buy some land with a house in need of rehab (and utility hook ups on site) on the cheap and purchase a manufactured home to live in while we worked on the house. We've looked at pricing for manufactured homes but does anyone have info on transport costs? Seems mighty hard to find.

Last question. We don't really mind where we move to, as long as it's got four seasons and useable land. We like the appalachian area, especially Eastern Ohio. Are there any other "cheap" areas of the country we should look into? Also are there any good real estate sites aside from realtor.com to use?

Well thanks for listening to may rambles, i'm sure all that made more sense in my head than in writing.

enjoy,

Jacques

[Joshie]

Since it is likely to take you several years to catch up with your loan I think you've got some time. I would do the repairs to the home myself. If a home needs repairs and updating it takes much longer to sell. Also, if people have to do work to a house they expect to get a great deal on it. Hopefully, the housing market will recover as you pay down your mortgage.

Manufactured homes can be very nice homes. We looked at making an addition to our house with a manufactured home builder. This is a quality built home and wasn't less expensive than stick built. The builder we've considered builds stick built houses in a factory.

You might be better off with the purchase of a trailer. You could sell it when you're able to build a home. Also, you need to remember that it can be difficult to get mortgages on large plots of land.

[Darren]

The big if is getting a job where you're planning to move. The current economic "decline" isn't over by a long shot. You didn't mention your skill set or work experience. You might want to concentrate on upgrading your skills to find work.

A nurse and folks with medical skills such as an EMT or Paramedic can usually find employment in rural areas or anywhere for that matter. Odds are that you may not have the same income you receive now once you move. BTW the mean salary for an RN in WV is over $52,000/year. It's higher i surrounding states.

Another route is a union apprenticeship. Locally the route is usually through a company that's had a difficult time staffing jobs. A union won't take apprentices if they have members sitting on the bench. That can be an area to area thing.

In your shoes I would pay down the house to protect your credit. So far you're doing the right thing which is ridding yourself of the credit card debt.

Moving to a rural location also depends on your "getting by skills." In this area a lot of folks do most of their own work from auto repair to home repairs. Anything you can do to gain skills will be a plus.

I'd survey the area you plan on moving to. You might want to sort out the work situation first. Move once you have a job. Rent for awhile and check out the area before buying.

We've had a fair amount of folks move into this county. Some stayed. Some left after learning more. Don't get yourself stuck. In many areas, it's the outsiders that end up buying the high priced and sometimes unsaleable properties at least from the local's point of view. Be very wary of an area that's had some kind of development that has caused local property owners to sky-high their expectations of what property is worth.

[Beeman]

Take your time and keep reading and posting on this board. Your 100k to spend on your next house idea isn't a good idea. Appalachia isn't known for high pay scales or an abundance of jobs. I would continue to live simply where you are right now. What do you think moving to the country will gain you?

[PubBurgers]

My skill set is not too impressive, i've pretty much just worked the food service/retail sector thus far. My work history is pretty stellar, at least as much as it can be for entry level jobs. I'd like to go back to school for business management in the near future.

My wife has a degree in restaurant management and is going back to school for medical transcription.

Once the credit cards are paid off we'll only require about $1200 a month to live in our current home (mortgage and all). Neither of us make terribly much more than minimum wage at the moment. Not to sound too much like i have no standards but as long as we're within 30-45 minutes of a decent population center i have no qualms staying in entry level jobs, which tend to be easier to get. I do agree that getting a job prior to moving is pretty much a must.

As for getting by skills i'm ok. I know how to work on a car and do general home/car repair skills. We've got food storage set up at our house and the wife knows how to can and garden. I could (and plan to) keep learning though.

We'd like to be ready to move by summer 2012, as long as we keep the reins tight on spending it should be doable.

thanks!

Jacques

[ronbre]

a really good quality double wide home doesn't have to be a temporary home..ours is equal or better than a lot of stick built homes..much nicer than the stick built home we previously lived in..and i wouldn't trade it now for any stick built home..it has 6" thick walls with wonderful double pane low e windows..it is on a permanent crawl space and we have an outside wood furnace that heats it and our son's double wide home.

don't get the "put down" idea about manufactured homes..just buy good quality ones with stick walls, good siding ours is vinyl and a real roof with a good pitch..and it is just as good as any stick built house.

pay off your debt..or if you really want to get out from under all of it you could file bankruptcy..but then you'll have a problem getting a loan for a new home..maybe if you think of bankruptcy you could find a home on a land contract first and get written agreement with them that if you file you'll be able to buy the house on a land contract anyway..before you file..then you can get out from under all of the debt and make a fresh start in a new home?

[Windy in Kansas]

Welcome to the forums. Glad you decided to join in. Best wishes for achieving our goals.

[Joshie]

Originally Posted by PubBurgers

I'd like to go back to school for business management in the near future.

My wife has a degree in restaurant management and is going back to school for medical transcription.


We'd like to be ready to move by summer 2012, as long as we keep the reins tight on spending it should be doable.

I think that this may take longer than two years. Your wife would likely make considerably more money by taking nurse's aid classes. The course is pretty short. After that, she could get a job at a hospital and then work at becoming an RN. It's not difficult to make $60,000 as a nurse. I'm not convinced that there are many jobs available as medical transcriptionists.

My nephew has a degree in business management from a well known school in Great Britain. He lives in IL and has been unable to find a job. He works as a front desk manager at a chain hotel. You might want to reconsider an education in business management in this economy. Have you thought of getting an education in nursing or as a physical therapist?

[Beeman]

Most everyone in rural areas is willing to take entry level jobs, that's all there is. Some counties have 18% unemployment.

I still ask, what do you think moving to the country will gain you? Why the idea of going deeper in debt while moving to the country?

[Darren]

Don't fall into the "a college degree is a ticket to paradise" trap. I've got two. They're worth nothing in this area. I can travel and make a good buck. Not into that any more. Business degree's are a dime a dozen. One lady I know who received hers recently is working at a convenience store.

Entry level jobs in food service will usually be available. That's minimum wage and probably no benefits. If you haven't already done so, you might want to take advantage of testing that explores what aptitudes you have. I bet schools near you have adult education classes in welding, machine shop, computer networking, etc. If any of that interests you and you have the time in the evening, explore that route.

The more flexible you are with a wide range of abilities, the better off you are. If you don't have a commercial driver's license and can get one, know that's a basic requirement of some jobs. Is the guy delivering supplies to your restaurant making more than you? Even in rural areas, someone has to do the route deliveries. Owner's of those companies have to pay a somewhat competitive wage.

One of the keys, and I dislike the expression, is to think outside the box. The two of you are young enough to make career changes without the problems of folks twice your age.

In any area, you'll have utility workers. The folks that work for power companies, telephone companies and the like do better than the average for rural areas. You'll need an electrical background as a starter to be considered. The jobs are out there. You're young enough to get the training to make a difference in your life later. Never stop learning.

[Beeman]

Rural areas are harder to get a job in with any skill level. Everyone has a son,daughter,nephew,niece,cousin or whatever that needs a job. Keep that in mind.

[NW Rancher]

It's fairly evident from your writing that you are a thoughtful, intelligent person. You write well. I would say that at 24 you are doing the right thing, focus on no debt and keep looking for that next great thing job-wise. I think people like yourself will find success, because it's clear that you are focused on your goals. The specifics will sort themselves out.

As far as good paying work goes, I don't know your area at all but the union recommendation is good. I will say that what little I can gather about you from your writing, well, have you thought about a more intellectual path? Writer perhaps? You can work your way on that path while working a day job, and you never know what seeds you plant now can blossom into later.

Best of luck!

[Mike in Ohio]

PubBurgers,

You don't indicate where you are currently located but hopefully my comments will be useful.

I would put some money into what you describe as needed for your current house. Keep an eye out for carpet remnants or something similar. If you can do the minor plumbing and electrical yourself, do it as you can. You may not fully get your money out of it but it will help make it easier when you want to sell. It shows that you have been maintaining the house. It may reduce the amount of loss you take as well.

If you are interested in buying in Eastern Ohio then I highly recommend www.farmanddairy.com. I find the print edition easier to peruse when looking at the ads. A lot of properties in Eastern Ohio are sold at auction. I think you could get yourself an older home with 5 or so acres for a reasonable price. You would need to line up your financing upfront though.

I would try to find a home you could live in while fixing up without spending the money on a manufactured home or trailer. The money you might spend on that would be better off being applied towards your permanent place.

As far as jobs, you might check with electric utility companies. My understanding is that a lot of linemen are nearing retirement age so there will be job opportunities (assuming that is a type of work you are interested in).

Just a few thoughts.

Mike

[Head4theHills]

My thoughts on the house-don't buy a manufactured home with the idea that it will be worth anything on paper. Especially in the current economic situation they are losing loan value quickly. If I were looking at investment value I would absolutely NOT get a manufactured home. In the last five years we saw the lending and financing options on this house go from a wide range to virtually none. Major lending companies won't touch a lot of them.

But-we live in one and it's a snug, efficient, comfortable little house. It's been moved several times since we bought it so it has absolutely no value to the bank. It would be worth more if we burned it down today-we can't get a loan or refi on this house at all, it's a liability.

But we paid so little for it ten years ago and got a really good deal on our ten acres of land so right now our land plus the house is worth about four times more than we owe on it. We could sell it right now as a tear down or take the house off and sell it as land only and be far ahead. And theoretically, we could sell this snug well-insulated house to you for pennies and if you had enough money saved up, you could be practially debt free with a house and land.

I don't think there is functionally a problem with manufactured homes if you get a good one (ours is a Marlett), preferably one that is built for northern areas for the R value, but banks HATE them. This little house of ours is built better than most spec homes here but the bank treats it like a tar paper shack. We heat the whole thing with a cookstove-haven't had a furnace on in six years, and we're never cold, it's cool in the summer. It's a good little house. but a pile of sticks to the bank. Very aggrevating!

As for the job, I see where you want to go but remember so does everybody else. Your wife's transcription job, any job that you can do online, is obviously a huge boon. Being a personable can-do type of guy in a small community will be a boon. Can you bartend? Every small town has a bar... Visit these small town, see what is there, see what you can do to apply yourself in the area.

In your shoes, I would be saving every available penny, exploring options, and spending all my energies toward getting ready to leap when the opportunity presents itself.

good luck!

[PubBurgers]

Ok, i'm gonna answer these questions in little snippets:

My wife can bartend, she was actually making killer money at it until the place was bought out and the new owner ran it into the ground. While i'm willing to learn, my current skill set is basic. I know it's an excuse, and a poor one at that, but finding time for further education is difficult at the moment. The wife works 7am-3pm while i watch the kid, she comes home just in time to pass him off so i can go to work from 4pm-10pm or sometimes even midnight. Even when i get free time i just want to be lazy and relax. That said the financial aid we can get at our income level would allow me to work part time so i could go to school. I'm thinking of going back summer or fall quarter.

I'm not so worried about property values, i'd like our next move to be the last one fore a long time.

As for why we want to move to the country? City life isn't for us. We currently live in Dayton, Ohio in a neighborhood where the neighbor's houses are about 10 feet away (6 of those feet are driveway). It's loud, it smells, we have zero privacy, and the high crime areas are a whopping two miles away, if that. I want to raise my son the way i was, not where there are 13 year old kids wandering around pretending to be gangsters. In addition, Dayton Public Schools are, well, not great would be putting it nicely. Regarding the debt, our goal is to pay off all of our cards and break even on the house. The only debt we'd have going into the new place would be my student loans (about $6K) and the new mortgage. Despite the debt, our credit scores are pretty stellar at the moment so getting a loan shouldn't be a problem and our situation isn't nearly dire enough to consider bankruptcy. Also, i liked having farm animals as a kid and i'd like to do it again. I want a challenge, to make a living with minimal "professional" work sounds like a good one.

I don't mean to sound like i have anything against manufactured homes, it's just something i'd previously not considered. Up until recently i thought the mcmansion with a ton of crap was the way to live, i've made some radical changes in my thought process recently.

We've still got a while to sort things out at least, which gives us plenty of time to plan and make sure we do this right the first time.

thanks for all the help and advice,

Jacques

[Beeman]

Watch the documentary I posted about Oxycontin, just happens to be about the areas you're looking. The area I live has a town of 4,000, we're eat up with meth and oxy. The schools in rural areas aren't very good, do you want to homeschool? Every week we see kids my kids went to school with being arrested. Alcohol is the devil in most rural areas and bars are places to get beat up or shot. It's not cheap or chaeaper in any way to move to the country. Everything is furthur and gas isn't getting cheaper. What opportunities do you want for your son?

Keep doing your research and don't wear rose colored glasses. You say you make about $2k a mo. and your budget with mortgage is $1200, that's $800 left to pay down your house extra a mo. $1200 sounds pretty low for a family with a baby.

[PubBurgers]

Originally Posted by Beeman

Watch the documentary I posted about Oxycontin, just happens to be about the areas you're looking. The area I live has a town of 4,000, we're eat up with meth and oxy. The schools in rural areas aren't very good, do you want to homeschool? Every week we see kids my kids went to school with being arrested. Alcohol is the devil in most rural areas and bars are places to get beat up or shot. It's not cheap or chaeaper in any way to move to the country. Everything is furthur and gas isn't getting cheaper. What opportunities do you want for your son?

Keep doing your research and don't wear rose colored glasses. You say you make about $2k a mo. and your budget with mortgage is $1200, that's $800 left to pay down your house extra a mo. $1200 sounds pretty low for a family with a baby.

$1200 a month may seem low but that is our actual budget right now if you remove the credit cards. Our mortgage (including insurance and property taxes) is $635. The remaining five hundred and change pays for everything else including my $50 a month student loan payment. The baby is breast fed and cloth diapered (i've used maybe 4 or 5 disposables since he was born, hate them) so he's essentially free for now. Our lifestyle is one that we can live on minimum wage quite comfortably, as long as we plan well that doesn't have to change with a similar priced house and land in the country (we'd like to buy even cheaper if possible).

Like i said, i grew up in the country, our town had a population of about 2,000. While it had its fair share of problems there were also plenty of opportunities and a decent education to be had if you were motivated.

I understand that the country isn't necessarily cheaper, but where gas costs and such may be higher, i won't be tempted to hit up the mickey d's half a mile away when i'm feeling too lazy to make lunch.

enjoy,

Jacques

[Darren]

I don't know about Ohio, but in central WV many of the newspapers are published weekly. Those are generally in the mostly rural counties with a county seat of from 2,000 to maybe 5,000 people. A subscription is cheap enough that you can start previewing an area long before you move.

Pay attention to letters to the editor, local columns and editorials. You can learn a lot about an area before you get ready to move. I've done that in the past and over time learned some eye-opening facts when I subscribed to newspapers in two locations I was considering. I never moved to either even though I visited both.

If you're planning on moving into the part of Ohio considered part of Appalachia consider reading "Night Comes to the Cumberlands". It will clue you into the history and culture that will definitely affect you.

[txquilter]

PubBurgers - Sounds like you've got a great plan in the works! It also sounds like that once you get that last credit card paid off you'll have about $800 a month to spend getting ready for your move. I'm fairly new to prepping and returning to my homesteader roots (born and raised in South Texas - country style!) and am looking at a 3 year time frame for my return. I am quite a bit older than you and your wife (being 45) but I think we each have our own timeframe on which we work.

My parents live in a double-wide mobile home on 8 acres of land and my dad has done an amazing job of "transforming" it into a home. He's added covered porches, attached garages and additional square footage to the home. He's remodeled the inside several times and they have had it for over 20 years so if you buy the right one they can last a long time.

I also had a friend that bought a mobile and lived on it until her home was built in Colorado. It is whatever works for your family.

The other thing to consider is since you have stated that you are not too particular about where the property is you should begin to take afternoon drives to different areas and explore towns you are interested in as possible homesites.

It sounds like you and your wife are on the same page and well on your way!

[PubBurgers]

A small update:

We've got the last card down to $7000 so that's coming along nicely. Home prices in our neighborhood seem to be on the slow rebound as well. With some luck we may be able to put the house up for sale this time next year, though spring 2012 is probably more realistic.

We've also become more open to cheaper homes that may need some work. We're toying with the idea of buying land and putting a trailer on it while we build as well. I think somewhere in the $50K range is our new housing budget. All that's a little further down the line to worry about though.

enjoy,

Jacques