I have been looking into buying real estate in Hendersonville, NC which is where I currently rent an apartment. The problem is that although I like the idea of investing my money, I am too worried about getting into negative equity. In case you do not know, negative equity is a situation where the value of your property is less than the mortgage you owe on it. This can happen when you borrow a big percentage of the value of the property and then house prices fall a lot. There is a risk of that happening at the moment as house prices seem to be falling all of the time at the moment. It is okay if you can manage your mortgage payments and want to stay in the house for a long time. However, if you take on a property and find you are struggling to make the repayments, you will not be able to sell it and pay off the debt because the sale value will not pay off the debt. This can be really worrying which is why I am just looking at Hendersonville, NC homes and not buying anything at the moment. Each month I save a bit extra towards my deposit and look around to see what is available and eventually I will buy something when I feel confident that the time is right. I think buying on your own makes it more risky as there is only one salary which is coming in and if that is stopped due to illness or redundancy then you will be in big trouble. Having several incomes in the house is much better in that it reduces that worry and has the added advantage of the fact that you might be able to buy something bigger or pay it off quicker with the joint salary.
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Posted by Rachel @ 9:16 am