Grits and Tamales

Life in the Deep South, by Gabriel Aguilera

301 North Panama Street, Montgomery AL 36107

Below is a pic of 301 North Panama Street, whose details may be examined here on Trulia.com.

There seem to be two neighborhoods in Monty, both affordable, that I like.  I am targeting homes  in the highly affordable Capitol Heights area, including 301 North Panama St.  These range between 90 and 110K.  In the nicer neighborhood, Old Cloverdale/Cloverdale-Idlewild, they range between 140 and 170K.  Mortgages are about $500 versus $800, give or take.  My back of the envelope calculations suggest that the opportunity costs of living in the nicer neighborhoods are too high given other needs and wants such as a fuel efficient vehicle, lifestyle preferences, and other investments.

It’s really hard not to buy when the market is as crappy as it is, so I’ve decided I’m going to buy and buy soon (next 6 months) if — and only if — I find something I’m willing to hang on to for the medium run (5-10 years).  I will be in Monty at least three years, which will give me a chance to pay down a fair amount of the mortgage.  If I buy a new place or leave Monty then renting the home won’t be much of a financial burden and might even yield a little revenue stream and some capital gains down the road.  If I stay, the mortgage will be dirt cheap, particularly if rates are still low in 3 years and I refinance into a new 30 year with a smaller loan.   Or I can just sell it.

There seem to be handful of homes in Capitol Heights that work.  Several have been on the market for months and prices have fallen somewhat since November, when I first started peeking at prices.  Here are the other two promising homes Capitol Heights:

319 North Panama Street, Montgomery AL 36107

2015 Yancey Avenue, Montgomery AL 36107

This is 301 North Panama Street, Montgomery AL 36107:

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