‘The Big Move’ is a MarketWatch column that looks at the ins and outs of housing, from navigating the search for new land to applying for a mortgage.
Do you have questions about buying or selling land? Do you want to know where to move next? Email Jacob Passy at TheBigMove@marketwatch.com.
I have lived on my earth for 40 years. I lived on 5.25 acres, and went to town to divide the land into subdivisions and its fitting.
I like where I live, but the earth is old and the children are gone. I am a 58 year old nurse. I pay $ 800 a month in property taxes plus my mortgage, which is together $ 2,500 a month.
I offered a good amount to sell my land for $ 500,000 more than two years ago. I have another earth that I like and want to buy, so I want to sell. But the sale went down to my earth, so I had to walk away from the house that I was going to buy.
Now there are no houses for sale and I have not yet found anything that I like. So I had to rent until I found something. Why should I do that? Or wait until more earth comes on the market and sells when I find it? I probably won’t get as much but the houses won’t be too expensive to buy as well. Not all out?
Better save money, go on vacation and not have to work very much. But I also don’t want to get caught up in paying rent as big when I have the earth and aren’t happy because I rent g in a place I don’t want to live.
I like my earth where I live! But property taxes are too expensive, and I’m close to retiring and having to sell. I still owe money on my earth and will not pay it before retirement unless I move.
The cost of land ownership rises rapidly across the country, so you are not alone in feeling burdened.
New research from property data firm Attom Data Solutions found that for the average household, having land is only affordable in 41% of counties nationally. In other words, in 59% of the other counties in the county, the average family must pay more than a third of the salary on earth for housing costs, including mortgage payments and property taxes.
Many are selling on the same ship as you. They’d sell on heart tags – if they could find the earth to buy. The diical earth inventory is on the following note, and that creates something of a vicious cycle. Land sellers are hesitant to put them on the market because there is almost no guarantee that they will have a place to live when the sale is completed.
Rent seems to be a one-way ticket for savings, but it’s far from certain. You don’t say where you live, but there’s a good possibility that it’s not all cheaper to rent. In fact, rents in the suburbs and countryside rose so much amid the pandemic that families have been looking for more space to live outside the big cities. A separate report from Attom Data Solutions found that owning three-bedroom land (at the average land price) is cheaper than renting three-bedroom land across nearly two-thirds of the country.
There are other disadvantages to renting, for sure. You don’t have control of your forward housing costs, so even if you can afford to rent for the first year there is nothing to stop the landlord from jacking up when you are going to renew. And when you own the earth, you’re building valuable financial assets.
New research finds that owning land is still more affordable than renting nearly two -thirds of the U.S., despite rising land prices.
With rent, whatever money you spend doesn’t come back to you. Even if you have a lower monthly cost, much depends on what you do with the savings. Ideally, you will be investing or planting for a rainy day, and not planting.
You can’t afford it, though. Given how mortgage rates are still down – even though they have risen in the last few weeks – I’d recommend seeing if financing it fits for you. But given how long you’ve been on your earth and the fact you’re still making mortgage payments, I would assume you’ve financed it recently.
You didn’t say what you did after you went to the local government to divide your land, but if it was sitting there, I would consider selling it. Since you have a mortgage, however, this will not be a direct process.
When land is divided, you must obtain written permission from the recipient or credit service that leads to the property, said Tom Trott, branch manager who owns Embrace Home Loans in Maryland.
“These requirements are in most mortgages and the standard language in the Fannie Mae and Freddie Mac trust deeds,” Trott said. To sell part of the property, you will need your lender’s permission. But if it’s hard to get, you still have a choice.
“Assuming they don’t get the approval right, then the other option is to carry out a repurchase of the remaining balance at the same time,” Trott said.