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I am about to relocate (from outside the US to Massachusetts) for a limited time period (~4 years). Compared to my current job and expenses, both prices and wages should be approximately X1.5 times higher at the new place. I have moderate savings ($250K) and for various reasons, I currently rent (mainly, it was easy not to deal with buying a home). Taking everything into consideration, I should be able to continue saving moderately in the new place like in the current (~$400/Month).

Should the fact that everything will now be multiplicatively more expensive affect my choices of owning a house, i.e buying rather than renting in the new location, America (with the intention of continue owning and renting it after i depart America)? The way I think of it is "in the short relocation time I will spend on rent an amount that will account for a large portion of a house in my original location (~40%), it's such a huge sum, why not leverage it to owning a property that is much more expensive (=rent yielding after I come back) than I would originally ever think of buying?"

Is this an opportunity to own (and continue renting after my departure) a more expensive house than I would normally think of, or if my savings stay the same this should not affect my decision?

  • Are you asking about buying a house in your home country before you leave for America? – RonJohn Nov 9 '19 at 7:05
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    Owning a home for less than 5-6 years is not recommended, because transaction costs overwhelm any principle gained. Besides, neither urban nor suburban Massachusetts are anywhere near "expansive". – RonJohn Nov 9 '19 at 7:34
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    I think you meant expensive (costs a lot) rather than expansive (big). If you really meant expansive, few free to revert the changes. – Lawrence Nov 9 '19 at 11:35
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    @RonJohn Revert? (And I spotted an auto-correct typo in my own comment. Embarrassing.) – Lawrence Nov 9 '19 at 13:39
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    @Lawrence I say sit tight. Your interpretation is probably correct. – RonJohn Nov 9 '19 at 13:41
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As @Four_lo said, you need to evaluate all the costs associated with the buy and all the costs associated with renting. From there you need to figure out what kinda rent you can charge for the property after you move out. From that you need to subtract management costs, since you likely won't fly to the US anytime your renter has a problem or something breaks.

I would strongly advise against trying to manage a property from a different country. If you can find a management company that you trust enough to handle that for you, and you can make more money in rent than the property is costing you (after management costs, insurance, taxes, mortgage, maintenance, HOA.....), then buying would be a good idea. Otherwise renting for 4 years is likely better.

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Not factoring in changes in value to the market take: the cost of borrowing + property tax + 100-300(home repair and possibly first time buyers insurance). Compare that to the cost of rent. Renting also has small additional costs. Buying small is a better financial choice because you'll pay less in interest.

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