New Car

[Dueller]

I'd shy away from real estate because it ain't liquid right now....and 2 or 3 years down the road you'll be graduating and needing to go on to grad school or your first job or whatever.

Sounds like you're currently living at home...so rents gotta be cheap. If dad is gonna front half the cost, show him how mature you are. Shop for an $8K car...use $4K of your money. You'll spend quite a bit of your nest egg over the next 2-3 years if you get a relatively new Bimmer....ins, maintenance, premium gas, etc. And in 2-3 years you'll have a 120K 3series worth about $8K.

There are some nice cars that can be had for $8K. Hell, buy a bit older 3 that's been maintained. In 3 years it'll be worth $4K. And you'll still have the bulk of your $13K left in the bank.

[gprsh924]

Thanks for all the advice so far in this thread. Hopefully I can clarify a few things right now.

The cars in my sig were what I was driving up to recently. This year for school, my dad is letting me use his 525 to get back and forth. It has 120K miles on it and while it is probably fine for a while, a change probably needs to be made relatively soon. I do not have my own car, my parents allow me to use theirs that they have in the garage.

I am able to have that money in the bank for a number of reasons. My parents are paying for my tuition as long as I continue to maintain a 3.2 or better (that is the gpa required for my $7K academic scholarship). All the money that is in my savings account is money that I have saved by working hard and trying not spend my money too foolishly over the past 7 years. My parents have never put a cent into that account. They still pay pay for stuff, but I at least pay my expenses at school as well as for any and all entertainment.

Nothing is official yet but my parents are thinking that I will probably get a new car soon. They haven't yet decided what percentage I would come up with and what they would cover, but I would likely be paying 25%-50%. They and I really want something that I will be able to drive for the next 3 years or so and not spend money on. He has basically said that they are going to help me buy a car and then clean their hands of it. Everything will become my responsibility, although it will likely still be in their name so that I can stay under their insurance and save a ton of money ( I already pay $1400 a year, and that is with a clean driving record). My dad's 525 has been rock solid, but as the miles add up it is starting to cost a lot to keep on the road. I have a feeling a 3 series would be similar. I like the idea of something newer and Japanese for the reliability factor but it still really needs to be fun to drive. The one thing I really dislike about most of the cars that would be decent possibilities is that they are all fwd. I crave rwd, and the car will absolutely be a manual.

As to doing work myself, my friends and I have installed a lift kits on my friends' Xterra and Tacoma, as well as auxiliary lights. So I have some capability, but not much, especially when I am away at school.

My money has been in a couple of different CD's over the last few years, but I am looking hard right now at finding a more aggressive investment vehicle.

Thanks again.

[berettafan]

r/e markets are different all over the country. properties that cover are starting to appear on the radar again and rates are still good.

the idea about buying and charging your roommates rent is a fantastic alternative to a straight up rental property. you instantly become 'the man' and you WILL begin to understand the difference between working for the man and being the man. i promise you it will open your eyes. i'm not talking about a get rich quick r/e scheme, i'm talking about putting other people's money to work for you. you have friends in school (potential roommates) who will buy you a home via rent payments because they either don't know any better or don't have the cash handy for a down payment. take advantage of this.

dueller with all due respect real estate isn't supposed to be liquid. you want liquid buy a stock. of course unless you use a margin account you won't be putting opm to work for you.

[Aurel]

I wonder If banks will loan the money to a college student for buying a rental property. Even if he as the cash for downpayment, doesn`t he also need proof of steady income to afford a loan?
Can you use future rental income as income guarantee to secure a loan? Unless of course the loan is in the name of the parents. Just a thought.

Aurel

[berettafan]

i presume the parents will need to sign.

[JavaBrewer]

Originally Posted by Porsche-O-Phile

Not even close.

Prices are still way too far out-of-whack with rental costs.

Of course, that doesn't preclude one from renting at a loss initially in hopes of recouping once that gap closes, but that's a much higher-risk game and I wouldn't recommend it for most people (who don't have high risk tolerances).

Case-in-point, I have a 2BR on the beach with two garage spaces. I pay +/- $1,300/mo. My neighbor two doors down with a similar unit, 2BR with ONE garage space (building is about the same age, etc.) pays well north of $2,500/mo on his interest-only mortgage. Granted he bought about two years ago, but that's illustrative of how goofy things are.

And yes, I've checked other markets/buildings too. It's virtually impossible to get the rents to cover the carrying costs right now. I'd wait a couple of years.

Admittedly I was checking rental rates for folks in my position, married with 2 kids, single family home, in the same community I now live. All matches for a 3bdrm,2.5ba, garage, single family home in my neighborhood started at $2400/mo for a dump and moved up to $4500/mo for a home that was equal to the home I now own. That $4500 would cover my mortgage, ins, property taxes, and still net me $600+/month.

$1300 month here is a 2bdrm/2bath apartment.

All that said - you're right - prices are still falling and will continue to do so through '08 and into '09. How much is anyone's guess. There are homes out there that are currently priced at a bargain (college student specials) that I could totally see a kid with proper backing funds picking up and renting the remaining rooms out. It could even swing into a rent free existence for him.

[Hugh R]

Back on topic, he's a college student, he has school monies in the bank, nothing else. He needs a practical car with a WARRANTY. And its going to have to last him a year or two out of school in all likelihood. What he wants and should practically get are not necessarily the same thing. An MR2 is cool, but he's not going to get laid in it very easily. How about a 4wd Subaru? Fun to drive, can come in stick, can haul the beer keg. I'm driving a Toyota Matrix for the next week or two until my Camry Hybrid comes in. It'll haul five adults and a couple of kegs! Sure a bimmer is cool, but when he buys a five y/o 325 and the trannie *****s-the-bed what does he do for reserve money to fix it?

[Porsche-O-Phile]

Think of the opportunities for having female housemates make partial payments on their rents with. . . umm. . . "favors".

[onlycafe]

mini cooper s.
a ton of fun to drive.
good fuel economy.
seems like a good service and warranty program.

[Sapporo Guy]

I have got more action from my crappy 96 rusty Cherokee than my 911 :P go figure !

This guy sounds like he's pretty stable and listens to his parents advice!

I wish I was as smart as he is when I was his age I'd bought yahoo and apple stocks !!! And would have had my real estate empire going ... oh well ... I did have fun and got good trim

What cars are popular with the girls right now?

I live in Japan ... so that would be Toyota Land Cruisers, Astros, and Cherokees
Note: The models have to be the squarish in shape, the girls over here hate guys who drive roundish looking cars ... like the BMW thingy ... one girl called it a fag car ... lolololololo

[Dueller]

Now that he has clarified his earlier post, I think he needs to get Dad to give him the 525 and let him maintain. Hell, my 92 525 wagon has 237K on the clock and going strong. Insurance/tags are cheap. For far less than what a new car depreciates, you can maintain that 525 over the next 2-3 years.

Tell dad you will take over all maintenance on it until you graduate and sell it when you're done with college and split whatever you get for it with dad. That seems to be win/win for all concerned.

[Hetmann]

I had a 535 that I kept too long. Kept fixing things and more things kept going wrong. Loved the car, fun to drive, but turned into a giant money pit at the end.

Sell the car while it's running well. Get whatever you can comfortably afford.

+1 on the Mini S. Total blast to drive, economical and easy to park.

[cnielsen]

Love me '98 M3! You can get a nice one for 11-12K and then save the rest. Get the sedan version, they are rare and I believe insurance is cheaper. Much more fun to drive than the 5 series!

Agree with Rob...have a nice car but you don't have to spend 20K. Do save some. You may not be able to buy rental property but you never know when you are going to stumble across a nice early 911 for 7 grand that just needs a new home It has happened to me several times and I am glad I had some extra change laying around to snatch them up real quick. Much better than making payments on a Mazda.

[gprsh924]

I don't know how I forgot this before. While the 525 is doing alright mechanically, it is starting to rust very badly on the bottom of all 4 doors, as well as on the lower rear quarter panels. I could deal with a little rust, but there is a solid inch of it at the bottom of the doors and it goes all the way through.

[onewhippedpuppy]

I'm a college student. I've owned multiple Porsches, BMWs, and an Audi. The ONLY way I would suggest buying a used German car right now is if you have a garage, a good set of tools, spare time, and the ability to repair issues that are minor-medium in severity. German cars give a superior driving experience, but they require more maintenance and repairs. If you don't DIY, just remember that a decent indy wrench will run you $100+/hr for labor, with the dealer being far more expensive. Also, parts costs are pretty easily 2x more than a comparable Japanese car. So, if you want a really great, fun car, that may require some wrenching time, have at it.

Now, if you're still reading, I'd go with something Japanese. You can pick up something that is still fun to drive, but will only require oil changes. Much better for a busy student. The Mazda3 and 6 are both great cars, if you're lucky maybe you can find a good price on a Mazdaspeed 3. The Maxima and Altima are also sportier than the average Accord. If you want an upgrade, pick up an older Lexus, Acura, or Infiniti.

[targa todd]

Guys, trust me I love the "buy a rental property" idea. It's just not going to work for him. He's in Oxford at Miami U (Ohio) and there is NOTHING around there. All the students live on campus and rental real estate is silly expensive.

Now, back to the car. As much as your heart wants a Bimmer, your practicality and wallet won't allow it. As previously recommended, you need reliability and a warranty. The RWD desire really narrows the list. Would you budge for AWD? If so, go Subaru. Get a WRX and you'll have plenty of fun. These are reliable and reasonably cool cars.

That's my $0.02

[onewhippedpuppy]

I missed the RWD caveat. Older Infiniti GS would be an option, as would a Infiniti G35.

Don't totally count out a FWD though. I bought my first one under protest, but have bought several since. Like you, I was a hardcore RWD guy. When done well, a FWD car can still be a lot of fun to drive. How about a 2002 Maxima with 240 HP, 5 speed, and a factory LSD? You could pretty easily find one for $10k. There's a lot of good options out there.

[gprsh924]

I would greatly prefer RWD or AWD, but I would settle for FWD if I find something that is fun, and there are definitely options out there. I am going to go test drive a few things tomorrow, hopefully I can make some progress.

I like the idea of a WRX, however, I am concerned that alot of them were probably driven extremely hard. Also, all the ones in my price range are out of warranty, whereas many of the Mazda3s should still have a year or two left.

Something like this is interesting:
http://www.cars.com/go/search/detail.jsp;?tracktype=usedcc&searchType=22&pageNumber=0&numResultsPerPage=50&largeNumResultsPerPage=0&sortorder=descending&sortfield=PRICE+descending%2cDISTANCE+ascending&certifiedOnly=false&criteria=K-%7cE-ALL%7cM-_45_%7cB-20000%7cH-%7cD-_408_%7cN-N%7cR-75%7cI-1%7cP-PRICE+descending%2cDISTANCE+ascending%7cQ-descending%7cX-popular%7cZ-60510&aff=national&paId=253425188&recnum=25&leadExists=true


Or this:
http://www.cars.com/go/search/detail.jsp;?tracktype=usedcc&searchType=22&pageNumber=0&numResultsPerPage=50&largeNumResultsPerPage=0&sortorder=descending&sortfield=PRICE+descending&certifiedOnly=false&criteria=K-manual%7cE-ALL%7cM-_30_%7cB-20000%7cH-%7cD-_7491_%7cN-N%7cR-75%7cI-1%7cP-PRICE+descending%7cQ-descending%7cX-popular%7cZ-60510&aff=national&paId=247862352&recnum=11&leadExists=true

[gprsh924]

But then I see an ad like this, and I know what I really want:
http://www.cars.com/go/search/detail.jsp;?tracktype=usedcc&searchType=22&pageNumber=0&numResultsPerPage=50&largeNumResultsPerPage=0&sortorder=descending&sortfield=PRICE+descending&certifiedOnly=false&criteria=K-manual%7cE-ALL%7cM-_5_%7cB-20000%7cH-%7cD-_31-3636_%7cN-N%7cR-75%7cI-1%7cP-PRICE+descending%7cQ-descending%7cX-popular%7cZ-60510&aff=national&paId=256057494&recnum=36&leadExists=true

But then the issues start dancing in my head: no warranty, 6 year old car vs. 2-3 year old car, more expensive parts/maintenance, higher insurance rates, worse fuel economy


My wallet and my brain are telling me to head to Asia, but my heart and my right foot are begging me to stay in Germany

[onewhippedpuppy]

WRX would be a fun ride. I'd try to buy one from an individual, so you could assess what kind of owner/driver he was. Before you go too far down that road, be certain you price insurance on one. The popularity of those cars with the Fast/Furious crowd has made insurance rates pretty painful, especially for single college guys.

Mazda 3 is a great car. My in-laws have a base model automatic, and it's still fun to drive. Smooth responsive motor, good steering feel and weight, and controlled ride. The 2.3S with a manual is supposed to be a lot of fun. Interior quality is almost Audi-like, very high quality. Great resale value too, always a plus.