My wife finds out what residency program she gets on March 19th. Through a process medical students refer to as “match,” they visit, interview and then rank residency programs in their order of preference. The programs, in turn, rank the applicants. You get the your highest choice that also wants you, until their slots are filled. There’s no guarantee that you get anything, either. About 5% (based solely on what I’ve been told) of people don’t match with any of the schools they ranked. If that happens, you have the option of doing a research year and trying again, or doing what’s called “scramble.” If you choose to scramble, you go to an open program somewhere in the country – it could be anywhere. You have zero control. My wife is a good student, and she applied to residencies that she thinks she has a fairly high probability of landing, but it’s stressful nonetheless. Until March 19th, we don’t know where we’ll be living come July. My job complicates this as well, of course, as I don’t want to leave it. If she did, for some reason have to scramble, I would likely have to look for a new job, and possibly live apart for awhile (until I find one).
Further complicating this matter is the fact that we own a house (it’s actually a condo). The word on the street is it isn’t the best time to sell real estate. At least I think I read that somewhere. My wife’s residency will last 3 years, and then it’s possible we’ll do it all again for her fellowship (2 years). Somewhere in there, it’d be nice to settle in somewhere and have a life. I like the idea of being involved in the community where I live and all that. And I have a career, too. Those are different posts, though. The main question is what to do when we get wherever we’re going.
If we’re only going to be there for 3 years, it might not make much sense to buy a place. Generally, you can avoid taking a loss on a piece of real estate if you (a) get a discount purchase (check out How to Buy Real Estate for 20% Below Market Value by John T Reed) or (b) stay in it long term and extract some value from it. Of course, the risk is lessened if the property has the potential to generate income. Rents appear to be falling. A couple days ago, I came across this article on the Smart Money site. The author makes a strong argument for renting. Not for just for me, but for most people.
The fact of the matter is, the historic returns for real estate are very low. That’s not to say you can’t make money from real estate – you can, and lots of people have. My wife and I currently have a rental unit that has done pretty well the last couple years. It produces a pretty decent amount of income. I wish I had ten more just like it. But that’s a rental property. The house you live in is less of an investment and more of a basic necessity. Plus, many people buy a lot more house than they need in order to impress their friends and keep up with their neighbors.
My wife and I think we have a basic solution to this conundrum, because we really would rather not rent. We both like real estate, so we’re down to the following solution: we might buy multi-unit housing and live in one of the units. We’ve actually found units in each area that might potentially be good properties. We’re going to try to buy a unit we could afford even if we weren’t able to find renters, but in an area that we feel has an economic reason for housing to be in long-term demand. Of course, based on our situation, it might be smarter to just rent. Housing prices are falling, but so are rents. As the Smart Money article makes clear, the historical returns are bad enough in housing, that there are probably better uses for your money. If you find a place you’d like to live the rest of your life or that is crazy undervalued, it doesn’t matter. Anyway, check out the Smart Money article. What do you think? Did he convince you? Let me know by email or in the comments. Thanks for reading.
No related posts.
Related posts brought to you by Yet Another Related Posts Plugin.
