na
Are you sure the price of building will go beyond your means? - sometimes it's more the land and finished product that double in price. Although building costs increase, are you sure the increase will be that dramatic?
We bought our property here 4 years ago and undoubtably since then everything has increased in price. I am paying my builder much more than I anticipated 4 years ago, but that is more than outweighed by the increased value of the end product.
It is tricky to know what to do for the best. Do you know anyone who built say 5 years ago with whom you could compare the various increases?
We bought our property here 4 years ago and undoubtably since then everything has increased in price. I am paying my builder much more than I anticipated 4 years ago, but that is more than outweighed by the increased value of the end product.
It is tricky to know what to do for the best. Do you know anyone who built say 5 years ago with whom you could compare the various increases?
Having followed your posts and seen a picture of you with your family I toink you are much younger than us. I don't know your market at all but as you have presented it it seems a reasonable risk. You have age on your side so can take a loan better than us - do your research and then follow your dream!
I think go for it....but have a plan - i.e. how you would pay mortgages etc if the property didn't let out whatever...the terrorist attacks the other week in Turkey didn't help...are you prepared to wash dishes if you had to? If you are take the gamble and grab it with both hands
Good luck & how's the dog?
Tansy
Good luck & how's the dog?
Tansy
Sounds like you are thinking things through very well, so the answer will present itself.
What I would give extra attention to is the price of construction, which has increased astronomically in the last 24 months here, largely due to the cost of building materials. This may be peculiar to the US, so check your local situation. Our houses are wood frame and use a lot of plywood, which has doubled in cost in 18 months.
There's a silly situation at the moment whereby you can buy a home here that was built 3 years ago for less than it would cost you to build the same house today, and that's not even counting the cost of the land. If the same applies in your neck of the woods, it would be as good a reason as any to build now rather than later.
I would think twice about selling Villa Hanorah because as a general rule, I always think it's better to add on to what you have, rather than swap a known quantity for an unknown quantity....better the devil you know and all that.
Also, I would think twice about going into business with a builder, even one to whom I was related. Better to sell him the parcel of land as one deal and then another separate deal to build the other house, otherwise it's messy. Split your risk, then if one goes belly up, you don't lose both.
If selling the land takes nothing away from Villa Hanorah and enables you to finance the building of another house that significantly increase your rental income, that in turn will enable you to borrow the money to buy another house, that may be the smart way to go. After all, vacant land is dead money. It may not be costing you much to manage, but it's tying up capital and earning nothing.
Having said that, if you don't need the extra rental income, then it's cheaper and less hassle to hang onto the land. Land never goes down in value because they are not making any more of it. It might be useful to have a look at how much vacant land prices have increased over the last 2-3 yrs compared to new housing.
Lots to think about, and there's no right or wrong answer. Sometimes a decision which is not the best from a financial perspective can work out brilliantly because it enables you to get where you want to go and lead lifestyle you want to live.
So my only suggestion really is to not allow yourself to make any decision until you have done all the research and financial projections, then having fully absorbed all that, put it away and make a decision from the heart.
What I would give extra attention to is the price of construction, which has increased astronomically in the last 24 months here, largely due to the cost of building materials. This may be peculiar to the US, so check your local situation. Our houses are wood frame and use a lot of plywood, which has doubled in cost in 18 months.
There's a silly situation at the moment whereby you can buy a home here that was built 3 years ago for less than it would cost you to build the same house today, and that's not even counting the cost of the land. If the same applies in your neck of the woods, it would be as good a reason as any to build now rather than later.
I would think twice about selling Villa Hanorah because as a general rule, I always think it's better to add on to what you have, rather than swap a known quantity for an unknown quantity....better the devil you know and all that.
Also, I would think twice about going into business with a builder, even one to whom I was related. Better to sell him the parcel of land as one deal and then another separate deal to build the other house, otherwise it's messy. Split your risk, then if one goes belly up, you don't lose both.
If selling the land takes nothing away from Villa Hanorah and enables you to finance the building of another house that significantly increase your rental income, that in turn will enable you to borrow the money to buy another house, that may be the smart way to go. After all, vacant land is dead money. It may not be costing you much to manage, but it's tying up capital and earning nothing.
Having said that, if you don't need the extra rental income, then it's cheaper and less hassle to hang onto the land. Land never goes down in value because they are not making any more of it. It might be useful to have a look at how much vacant land prices have increased over the last 2-3 yrs compared to new housing.
Lots to think about, and there's no right or wrong answer. Sometimes a decision which is not the best from a financial perspective can work out brilliantly because it enables you to get where you want to go and lead lifestyle you want to live.
So my only suggestion really is to not allow yourself to make any decision until you have done all the research and financial projections, then having fully absorbed all that, put it away and make a decision from the heart.
Waves from America
- Alan Knighting
- Posts: 4120
- Joined: Mon Oct 18, 2004 7:26 am
- Location: Monflanquin, Lot-et-Garonne, France
Hanorah,
Between yourself and Joanna I think you have the thought process worked out to a "T" but only you and your husband can make the final decision.
I know absolutely nothing about the Turkish market but If I were you, and I could afford to do it, I think I would commit to the investment now and delay selling anything for as long as possible. Even if your enhanced rental income did nothing but service the cost of the additional properties you could be looking forward to a substantial capital gain at the end of the day.
Alan
Between yourself and Joanna I think you have the thought process worked out to a "T" but only you and your husband can make the final decision.
I know absolutely nothing about the Turkish market but If I were you, and I could afford to do it, I think I would commit to the investment now and delay selling anything for as long as possible. Even if your enhanced rental income did nothing but service the cost of the additional properties you could be looking forward to a substantial capital gain at the end of the day.
Alan
Ah, my cottage is named after my mam Lily and you do get a great sentimental attachement because of that. Anyway, I'm terrible with numbers having the equivelent of dyslexia with them so no good financially but just to wish you good luck and success whatever your choice. SueSentimentality is putting me off especially as she is named after my mother but I have been very guilty of letting my heart rule my head regarding property in the past.
I wouldn't want to say anything that would sway you because Turkey and real estate speculation are two things I know very little about. But I would be very wary of such an arrangement with a builder, unless he were building two identical houses and you get the choice of which is yours after he has finished.
What Joanna said sounds like very sensible advice to me.
What Joanna said sounds like very sensible advice to me.
Paolo
Lay My Hat
Lay My Hat