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Originally Posted by CoachKandSportsguy
yes, except that the price of the resale has increased dramatically due to the scarcity of the new houses in that area. . . so the comment is comparing apples and oranges.
the comparison is always, how much can you afford, and where do you want to live. If you want to live 1.5 mi from LSL, and you can't afford the purchase price, or there are no houses in your price range, the bond doesn't matter either way.
The bond is a future expense. The house price is a here and now cash purchase. .
finance guy
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Finance guy, interesting thoughts. I guess this is where behavioral economics come in.
I've grappled with how to think about the bond for a bit, before I bought my house. In my brain the bond is an ongoing carrying expense every year, like a mortgage. It's not a 100% comparison, because then bond can be transferred to the person who buys your house, if you sell it. So, I think it somewhat depends on how long you plan to keep the house. Not sure if you sell a house wiht a lower bond, if you get a higher selling price. My guess is no, but it might be viewed as more desirable than one with a higher bond, and therefore get more offers.
Also, if you buy a house without a bond, you can always take a mortgage out on it for the value of the bond you would have paid on the other house you were going to buy and call it even, if you keep the house. If you sell the house, of course you need to pay off the mortgage,, where bonds get passed on to the new homeowner.
Well, those are my thought, for what they are worth.