OT: House Buying

[jaihawk]

I'd like to think of myself as frugal and know what our sweetspot is; 300-400k with the higher-end being probably a worst-case scenario.

Are there any no-no's when purchasing? I.e. what things in a house that's forsale that should set off alarms? Like I said above, the house we just dropped by yesterday I could tell was a flip, as they really redid the kitchen and the area you walk in to but neglected the rest of the house.

This is where, as the buyer, finding a really good realtor that you can trust is of great benefit. If you're buying a pre-owned home, that realtor should have a good understanding of the quality of the builder and at first glance, anything that is an absolute no-go. They will also help protect you by lining up a great inspector and helping you write things into the purchase agreement to protect you. Since their commission is paid by the seller, there's really no downside to having one.

 

[Alcaus]

My wife and I got married for cheap and put that money into a house in 2019.

 

[jaihawk]

My wife and I got married for cheap and put that money into a house in 2019.

Which is smart or even asking for people to donate to your house fund rather than buy you shit that you really end up not needing.

 

[Huskers4420]

On a single income, it's basically impossible to buy a house right now. Which is a damn buzz kill. I need to tie down a doctor.

 

[Goskers07]

On a single income, it's basically impossible to buy a house right now. Which is a damn buzz kill. I need to tie down a doctor.

It's a great strategy, so I've heard.

 

[BIG TONE SOPRANO]

Buy, Buy, Buy........... I'm telling every friend, client, relative to BUY NOW and not wait. Without getting too in depth we all know an election is coming up next year. Typically interest rates, unemployment & gas prices drop towards the end of the year before an election. Those dirty politicians want to get re-elected. There is a saying in Real Estate: Marry the House, Date the Rate. Interest Rates will go up and down. They are currently high but when they go down we are expecting a huge increase in demand, hence higher prices. Buy Now and refinance in 6 months and then probably again in 2 years as rates drop. Supply & Demand, right now there are way more buyers than sellers out there, and that number is increasing. If I won $2 million in the Lottery today I'd go out and buy $2 million in real estate and retire off of the Rental Income. During inflationary times real estate and gold are typically 2 of the best investments.

We follow numerous Real Estate Economists/Specialists and all of them are expecting a bull market towards the end of this year or early next year. Get in before the demand and prices rise. Watch this YouTube. Brian Buffini is one of the most spot on when it comes to track records on predictions over the last 15 years.

I wouldn’t put too much stock in what the ‘experts’ think will happen. Barry Habib said rates would be at 5% or below by May 2023.

 

[TooTall]

If you're buying, I see no downside for using a realtor.

Selling is a little different.

100% agree, get yourself a buyer agent, one that represents you the buyer, and not one that tries to sell you their listings.

All the house we bought we used a buyer agent, it was a good thing each time.

It is much easier to do that as they have access to houses / showings easier etc.

Good luck, and I'm with MtnHusker, buy now and refi when the rates drop, yes the prices are high now, but in 6 mo to a year, you'll have high rates and higher prices.

 

[Faux Sean Callahan]

Happy Friday, tpb. I will preface that my wife and I are in no rush to buy a house, but we are thinking about beginning that process. We would be first-time home buyers. We got married last month, and with that being said, we paid for it all ourselves and do not quite have the capital and funds we would have if we hadn't.

Our (my) biggest question for all of you elderly and more wise folks of the board... does anyone know what the fuck is going to happen in this economy? I've heard many different things and I'm unsure if the economy potentially tanking would benefit first-time home buyers like us... or if it would impact it at all. I have noticed that 30-year mortgage interest rates have dropped (lol) a bit since the beginning of the year (sitting at 6.8%~ish at the moment). In that same breath, I read an article that said nearly 90% of borrowers have rates below 3%.

Extremely frustrating that the market is still in the absolute shitter and people whom bought a house two years ago, not only got low interest rates, but have seen the market value of their property raise and raise.

Really going to depend on where you live....

If you live in Omaha or an area where a lot of the economy is service work, you likely wont see much of a drop ever in housing prices.

If you live in an area where there is high levels of manufacturing jobs, VRBO's, etc.... all bets are off. If there is any sort of recession these markets will likely get hit the hardest.

Problem is bulk of people are sitting with 2/3% interest on their mortgages. So we are at a point where home builders are making up more and more of the homes purchased currently. I want to say one of the national builders said that they are making up 30% and typically they make up like 13% of homes sold....Don't quote me on the exact numbers, but you can see the concept.

You are basically locked into your current home with 2/3% interest. So there aren't very many people with homes wanting to move.

So I guess our questions...

1. Do we need to have a realtor for any other purpose than placing a bid for us?
2. Do we wait and renew our lease for another year?
3. General market thoughts?
4. What does the build process look like if we were to go down this path?

Thanks, tpb.

1. You don't know what you don't know when you are going through this on the first time. I would say interview a handful and ask them questions to get an idea about what it is they do? How they get paid as the buying agent? How they are getting their clients homes in this market? etc......

2. & 3. going to depend on where you live.

4. Builders are better on the supply chain now, lumber is down in cost, but demand for those home are high considering what I mentioned earlier.

I know the lead time when I was looking into it was close to a year start to finish and they said it was closer to 6 months a couple years ago.

 

[Faux Sean Callahan]

So here’s my issue. Bought a house back in 2019 at 179k. I paid off nearly 20k in principal with extra payments and with today’s home prices in my neighborhood, I could probably get 230k.

Now, my house is small. 1260 sq ft. Wife and I want to move up and start having kids. With my income alone, could probably do a 420k house with figuring out what our mortgage should be.

I think I know the answer, but should I buy a new one and sell the one I’m in?

Keep your current house and rent it if you are made for that type of business venture.

Looks like houses with similar square footage are renting for 2100-1800/month.

 

[Juro]

Keep your current house and rent it if you are made for that type of business venture.

Looks like houses with similar square footage are renting for 2100-1800/month.

How do I handle managing it? @MtnHusker

Do I go through a separate agency for renting it out or do I manage it by myself?

 

[Baron Winnebago]

How do I handle managing it? @MtnHusker

Do I go through a separate agency for renting it out or do I manage it by myself?

Depends how much you'd like doing that/what break even would be?

I'm not an expert at all, but I'd rather gouge my eyes out than deal with tenants

 

[Bootleg11]

Really going to depend on where you live....

If you live in Omaha or an area where a lot of the economy is service work, you likely wont see much of a drop ever in housing prices.

If you live in an area where there is high levels of manufacturing jobs, VRBO's, etc.... all bets are off. If there is any sort of recession these markets will likely get hit the hardest.

Problem is bulk of people are sitting with 2/3% interest on their mortgages. So we are at a point where home builders are making up more and more of the homes purchased currently. I want to say one of the national builders said that they are making up 30% and typically they make up like 13% of homes sold....Don't quote me on the exact numbers, but you can see the concept.

You are basically locked into your current home with 2/3% interest. So there aren't very many people with homes wanting to move.


1. You don't know what you don't know when you are going through this on the first time. I would say interview a handful and ask them questions to get an idea about what it is they do? How they get paid as the buying agent? How they are getting their clients homes in this market? etc......

2. & 3. going to depend on where you live.

4. Builders are better on the supply chain now, lumber is down in cost, but demand for those home are high considering what I mentioned earlier.

I know the lead time when I was looking into it was close to a year start to finish and they said it was closer to 6 months a couple years ago.

Friends just finished their house in like 11 months. 10 years ago our house was built in 4-5 months.

 

[Baron Winnebago]

Friends just finished their house in like 11 months. 10 years ago our house was built in 4-5 months.

We nearly missed our closing date last summer and our rate lock which would have sent me to fucking Pluto because the jerk off builder couldn't get sod in until literally the morning of close.

 

[HughJanus]

How do I handle managing it? @MtnHusker

Do I go through a separate agency for renting it out or do I manage it by myself?

My friend is using some rental agency to manage his first home. I believe the fee is super reasonable from what I remember.

 

[HughJanus]

Also don't forget to consider neighborhood and location desirability when making your purchase. Established neighborhoods with attractive housing stock, and good schools will always be in high demand. Another approach is to identify locations where the city is planning transportation infrastructure improvements in the next few years, as these projects tend to improve real estate value nearby. For example in Omaha I would find something within walking distance of the proposed streetcar project. When completed these properties will experience above average increases in property value.

 

[BingoDingo]

Depends how much you'd like doing that/what break even would be?

I'm not an expert at all, but I'd rather gouge my eyes out than deal with tenants

That's why you marry into a Mexican family with a constant stream of people who would love to move into a nice home..and because they are Familia, even if they fuck something up, they will fix it before they apologize for it. Hell, they will come over and fix shit in your home too...

 

[nscottie]

Buy, Buy, Buy........... I'm telling every friend, client, relative to BUY NOW and not wait. Without getting too in depth we all know an election is coming up next year. Typically interest rates, unemployment & gas prices drop towards the end of the year before an election. Those dirty politicians want to get re-elected. There is a saying in Real Estate: Marry the House, Date the Rate. Interest Rates will go up and down. They are currently high but when they go down we are expecting a huge increase in demand, hence higher prices. Buy Now and refinance in 6 months and then probably again in 2 years as rates drop. Supply & Demand, right now there are way more buyers than sellers out there, and that number is increasing. If I won $2 million in the Lottery today I'd go out and buy $2 million in real estate and retire off of the Rental Income. During inflationary times real estate and gold are typically 2 of the best investments.

We follow numerous Real Estate Economists/Specialists and all of them are expecting a bull market towards the end of this year or early next year. Get in before the demand and prices rise. Watch this YouTube. Brian Buffini is one of the most spot on when it comes to track records on predictions over the last 15 years.

100% agree. When rates go down, home prices will go up again. Been reading the same things.

When rates go dow, you can refinance if you already own.

 

[2010sarenevercomingback]

That's why you marry into a Mexican family with a constant stream of people who would love to move into a nice home..and because they are Familia, even if they fuck something up, they will fix it before they apologize for it. Hell, they will come over and fix shit in your home too...

My wife says I'm not allowed to do this.

 

[MtnHusker]

How do I handle managing it? @MtnHusker

Do I go through a separate agency for renting it out or do I manage it by myself?

I generally manage the properties myself. But there are rental managers out there you can hire. Long Term Rentals you can find companies that will doo it for about 10%. For Short Term Rentals you are probably looking at 15-30% depending on how much they are doing. It is not difficult to manage a long term rental. Put an ad out there. Subscribe to a credit/background check online service, around $35/yr. Find candidates and background check them. We generally ask for 1st month rent, last months rent and a security deposit equal to 1 months rent. If you are renting your place for $2,000/month that is $24,000/year rental income with $2,400 going to a rental management company. Less stress them running that but also that $2,400 is a nice vacation for the family or a couple mortgage payments allowing you to pay off the home sooner. On most of my long term rental properties the calls I have gotten from tenants were clogged drains, appliance having issues or garbage disposal not working. A general rule of thumb is to put away 10% of your rental income for maintenance. Whether you are living there or you are renting it out at some point appliances could need to be replaced, hot water heater could go out, HVAC reaches the end of it's life expectancy, place needs to be repainted, carpets replaced.......

 

[Faux Sean Callahan]

I'm not an expert at all, but I'd rather gouge my eyes out than deal with tenants

Very real concern