Owning a house vs rent for me [Foriegner living in US - Singapore Citizen]?

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athrowman66
Posts: 7
Joined: Fri Jan 11, 2019 12:57 pm

Owning a house vs rent for me [Foriegner living in US - Singapore Citizen]?

Post by athrowman66 » Fri Jan 11, 2019 1:51 pm

Me and wife live in relatively HCOL (Northern Virginia). We both are foreigners working in work visa. Green Card(GC) application is just getting started. So it will take like 2 yrs before we get GC , if there are no surprises like rule changes by government, company policies, recession, etc. We work in a competitive industry, so in recession we may lose our jobs, if we lose jobs we need to return to home country. We love this country and would like to live here if possible. I am not good at stocks or finance I have invested like close to 15k in different stocks and etf, growth is less than 10% overall (2.5 years since I started investing). So I am not sure I will be able to get like 7 growth in stocks which seems to year over year SPY avg. We are from Asia, main ways to save is housing and cash( that's how we grown up). My wife is not into stocks and she wants the most stable investment (cash) if not then housing.


Age: 30
Combined income: $200k
Money in Savings account: $120k
401k - $35k
Equivalent to 401k in my country(Singapore) -$120k
House Rent - $1500
For tax purposes- US resident alien
Singapore Taxes - No capital gain tax and no foreign income tax

We are looking for houses recently

i) New prebuilt townhouse around $420k buying directly from builder(less manintenance, hopefully) . It is in walking distance to work , I might be able to rent the lower floor for like $900 since there are couple of big fortune 500 companies in walking distance. School district is bad.

ii) 2bd Condo around $200k 1990+ built. Jst nice for us and we never did any maintenance on our house and grown up in an small apartment. School district bad, close to work as well (10m drive).

Since we are dependent on work visa, we are not sure it's wise to put in 420k on an house here. Instead of putting in bank we were thinking whether should be buy a condo that's cheaper instead of paying rent of $1500 every month. But we saw condos are slightly difficult to sell than townhouse. I saw nytimes buy or rent calculator, buying 200k condo is better if our rent is more than $1k.

Can you guys access which would you choose ? Condo 200k , townhouse 400k or simple rent 1.5k/m.
Last edited by athrowman66 on Fri Jan 11, 2019 3:15 pm, edited 2 times in total.

btenny
Posts: 5103
Joined: Sun Oct 07, 2007 6:47 pm

Re: Owning a house vs rent for me ?

Post by btenny » Fri Jan 11, 2019 2:21 pm

Welcome to Bogleheads. Hope we can help you a little. I think you need to keep renting a house or apartment until you get your GC and your wife gets her GC. Without that you are both at risk of needing or wanting to move back. Plus you are not likely to get good terms on a mortgage and may not even qualify for a mortgage. I do not know. So I have no comments on what house to buy.

As far as investing you say you have $150K invested in 401K vehicle back home plus $150K in your US savings account and a US 401K. You are doing wonderful for your age. Now you need to put a lot of that money to work. I know your wife is conservative but you have to invest to keep up with inflation. Try to explain it to her. Then I suggest you put 60% of your savings into US stocks and 40% into CDs to keep your wife happy. Then invest the foreign 401K similarly but with foreign stocks and foreign bonds if possible.

Good Luck.

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BL
Posts: 9070
Joined: Sun Mar 01, 2009 2:28 pm

Re: Owning a house vs rent for me ?

Post by BL » Fri Jan 11, 2019 2:28 pm

I suggest waiting at least until you get a green card, since there are too many "ifs" and selling in a hurry often means losing money.

Here is a great little booklet for new investors and all of us:
https://www.etf.com/docs/IfYouCan.pdf

Above are Vanguard funds, but Fidelity or Schwab also have low-ER funds, if you look carefully.

You might mention your country or at least green card by editing the title if you want info from those more knowledgeable in taxes, etc., for similar circumstances.

Topic Author
athrowman66
Posts: 7
Joined: Fri Jan 11, 2019 12:57 pm

Re: Owning a house vs rent for me ?

Post by athrowman66 » Fri Jan 11, 2019 3:03 pm

Thank you. Regarding loans, I have a decent credit score (750+) , for tax purposes I'm considered US tax resident. In terms of loan, I should be able to get a decent mortgage rates (4.5 % for 30 yes) , I didn't get pre approval lettet yet. But the credit union officer told I should be looking at 4-4.5 %.

Dottie57
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Joined: Thu May 19, 2016 5:43 pm

Re: Owning a house vs rent for me [Foriegner living in US - Singapore Citizen]?

Post by Dottie57 » Fri Jan 11, 2019 3:17 pm

Don’t buy until you have permanent status. Seriously.

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BL
Posts: 9070
Joined: Sun Mar 01, 2009 2:28 pm

Re: Owning a house vs rent for me ?

Post by BL » Fri Jan 11, 2019 3:25 pm

I think the same advice regarding buying a house would apply to others who are not sure they will be staying put for 5-7 years at least. Renting is often the best solution, and is not "wasting money". Just because you can get a loan doesn't mean it is a smart buy. Buying a house is buying a lifestyle, not really an investment, according to what I read here. It may or may not have a profit. In 2008, many saw their homes lose lots of value.

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