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Hari Seldon · Apr 29, 2013

I have been looking to purchase my second home for a while now, but I waited too damn long. Houses are going for way more this spring and being sold in a matter of days. The housing boom has finally restarted with a vengeance. I guess all the people that sat out since 2008 and saved their 20% are out in force now.

kylej · Apr 29, 2013

dpatel304 said:
I'm in the process of buying a condo and I told my lender it was going to be my 'primary residence'. I believe that means I, technically, have to live in it for a year or so before I can rent it out. Is there anything stopping me from renting it out before hand? I know it would be impossible for me to get another mortgage and list that as my primary residence, but it doesn't seem like there would be anything stopping me from renting it out anyway.

Yes. You just have to make sure you stay within the boundaries of the SAFE Act. Ask a good commercial lawyer in your area, they will walk you through the process. I orchestrate some private money deals in this space and it can definitely be done.

-------------

That being said, for those of you who read this thread and are thinking of buying a condo as a first time purchase, please dont.

Condos are a joke even with this resurgent marketplace. With low interest rates, you're undermining your purchasing power with [x] amount of money going to a condo fee each month.

Let's say you have to pay an additional $300 a month for fees. I made a quick Excel calc as an example:

At 3.5% (easily attainable with good credit), $300 a month gives you an extra $70,000 in purchasing power towards a home. Even if you're disabled and need someone to mow the lawn and plow the driveway, you can still get those done cheaper than the average association fees. Don't spend money on condo fees because you don't net anything from them.

RoadDogg · Apr 29, 2013

dpatel304 said:
I'm in the process of buying a condo and I told my lender it was going to be my 'primary residence'. I believe that means I, technically, have to live in it for a year or so before I can rent it out. Is there anything stopping me from renting it out before hand? I know it would be impossible for me to get another mortgage and list that as my primary residence, but it doesn't seem like there would be anything stopping me from renting it out anyway.

I would imagine you would want to list it as your primary residence on your income taxes to avoid any issues with the mortgage as well.

snacknuts · Apr 29, 2013

My wife and I are looking to purchase our first home together (currently living in a house I purchased by myself in 2004, and which we are selling at the end of May). We found a house we really liked in a neighborhood that we love, and apart from some stubbornness from the sellers everything was going really well. We had the inspection on Saturday, however, and there are some pretty serious issues with the roof. I have a feeling we're going to have to walk away and go back to the drawing board. It's really unfortunate, because we haven't been able to find any other houses that we like nearly as much. Oh well, onward and upward!

izakq · Apr 29, 2013

snacknuts said:
My wife and I are looking to purchase our first home together (currently living in a house I purchased by myself in 2004, and which we are selling at the end of May). We found a house we really liked in a neighborhood that we love, and apart from some stubbornness from the sellers everything was going really well. We had the inspection on Saturday, however, and there are some pretty serious issues with the roof. I have a feeling we're going to have to walk away and go back to the drawing board. It's really unfortunate, because we haven't been able to find any other houses that we like nearly as much. Oh well, onward and upward!

You're not thinking about asking to lower the price due to the roof issues? Or are the repairs that bad?

Zapages · Apr 29, 2013

Zapages said:
would you guys buy a house in a flood zone. Its in A7 flood zone, meaning that it was flooded only once in the past 100 and it was only during Hurricane Irene? The house is going for 250K in a good neighborhood and town.

For the new page.

Also what key things to look for this type of home?

PS: 1st time home buyer. (my parents)

Rhomega Beta · Apr 29, 2013

Back in 2002, my parents bought a house in Calhan, Colorado, some 35 miles northeast of Colorado Springs. Then a year later, my dad got laid off, we declared bankruptcy, foreclosed, and moved back to the Springs. Now, they're trying again. They bought a house in New River, AZ, just a few minutes from where we live now. It's under construction, will be done sometime in August.

snacknuts · Apr 29, 2013

izakq said:
You're not thinking about asking to lower the price due to the roof issues? Or are the repairs that bad?

When we finally reached a purchase agreement, they came down to our max offer, but only on the condition that the home would be sold 'as is'. We, of course, have the option to walk away after the inspection, and this morning we are submitting something stating that the only way we are going to purchase the home is if they make all necessary repairs to the roof. However, I expect them to balk and decline.

Zapages said:
For the new page.

If you can get flood insurance on it, I don't see why not.

Zapages · Apr 29, 2013

snacknuts said:
If you can get flood insurance on it, I don't see why not.

They are requiring the flood insurance.... But still it makes me weary about it. Any opinions about homes in a flood zone or by rivers/streams?

ThLunarian · Apr 29, 2013

I've owned three residential properties for about 6 years. I bought the last one not long before the housing crash.

It's not as bad as some people here say. Even after replacing two roofs and three complete HVAC systems plus various other smaller repairs, I'm still breaking even month to month on my two investments, and my equity in all three houses is only getting higher. Maybe I've just been lucky though; I don't know.

Enjoy your new home, OP!

flyinpiranha · Apr 29, 2013

NervousXtian said:
Just saw this thread, wife and I are in the market for our first house here in Portland.

Just started the process, got pre-approved, finishing up that side.. looked at a few houses but holding out for the right fixer-upper at that low low price.

I can tell already it's going to be a frustrating and long process.. but with the rates today our mortgage+insurance+tax will be about the same as we pay in rent now.

Portland, OR? That's where my fiance will be looking in a year or so. Hopefully will have 10-15% downpayment of a $200-220k house. We pay fairly cheap for rent, nice condo, 1300 SQFT in Raleigh Hills and it's only $1000 so we've been trying to adjust and save what would be our 'extra' for a house payment (probably around $1500).

House prices are going up here unfortunately. My friends bought in Tualatin at $190k and it probably go for a lot more now. I just hope they don't go up too fast, I don't want a $200k house to be $260 in a couple years, that will price us out of the market.

AstroNut325 · Apr 29, 2013

My wife and I have been house hunting since December in Los Angeles. Still no luck. We're targeting homes in the San Gabriel Valley/Pasadena area. EVERY home we have put on offer on has gone for at least $30K over asking price! Oh and the "winners" are also foregoing buyer protections such as appraisal, termite, ect..

We're seeing really low inventory right now (down over 50% year-over-year) and the demand has picked up due to interest rates inching upwards.

It really looks like we picked the wrong time to get into the housing market.

Ace Harding · Apr 29, 2013

I'm saving for a down payment on my first home. Right now, we could put 10-20% down on a "starter home" but all of my calculations under a variety of scenarios indicate that we would lose money unless we stayed in the place for at least 6 years. I'm not interested in buying until we can put 20% down on a house I'd be comfortable staying in for 10+ years.

So until then, I'm renting.

I'm tired of people saying "oh its the perfect time to buy now, you are wasting money on rent." But if I bought, I'd be paying closing fees, interest, insurance, and property taxes (not insignificant). And I don't expect the property value to increase much faster than inflation (if at all). If I bought something comparable to what I'm renting I'd lose money if I sold it in 6-7 years. That's not even including major repairs/renovations. Doesn't make sense to me.

rkn · Apr 29, 2013

AstroNut325 said:
My wife and I have been house hunting since December in Los Angeles. Still no luck. We're targeting homes in the San Gabriel Valley/Pasadena area. EVERY home we have put on offer on has gone for at least $30K over asking price! Oh and the "winners" are also foregoing buyer protections such as appraisal, termite, ect..

We're seeing really low inventory right now (down over 50% year-over-year) and the demand has picked up due to interest rates inching upwards.

It really looks like we picked the wrong time to get into the housing market.

I've iced my plans for the rest of this year, saving for a bigger down payment, but jeez, shit like this just sucks all the winds out of my sails. I'd be looking in the same area btw.

Ourobolus · Apr 30, 2013

Yeah. It can be a little disconcerting. My wife and I have been debating moving to Seattle (not right now, but in like 5-6 years), and while I'm hoping I can make some money off of the house we just bought, the thought of having to put down a payment for another one is daunting, especially with prices picking back up.

Kwixotik · Apr 30, 2013

When did you guys decide to buy a home? I can't imagine being rooted down like that. I guess it comes with having kids?

Marty Chinn · Apr 30, 2013

rkn said:
I've iced my plans for the rest of this year, saving for a bigger down payment, but jeez, shit like this just sucks all the winds out of my sails. I'd be looking in the same area btw.

Yep, we came to the same conclusion. We'll still glance, but we're not planning to just save a bit more for the next year or two and build up a bigger down payment. A lot of houses we're looking at are going more 100k or more over listing. It's nuts. You can pay almost a million for a 3 bed, 1650 sqft house.

Mattlikewhoa · Apr 30, 2013

It's nice to see that this thread is still going.

So a little update. We (My wife and I) had bought a new build townhouse (1500 SQ feet), and moved in last March. It's a start home since it was smaller and cheaper ($315K Canadian), but it came with a top of upgrades from the builder, and we only had to add another $12K in added upgrades that we wanted (things that are harder to change down the road).

We had planned to stay for the duration of our amortization period (5 years). The plan was to sell and buy a fully detached house around that time.

We had noticed that the houses in our area were selling for $50K more when we had just moved in. We didn't really pay attention till the for sale signs were all over the place. I think that summer, 15 houses sold in our area.

So now my wife is pregnant with our first and we were thinking about buying that detached house a lot sooner. A quick check on MLS shows an average sale price for our current model house is selling in the range of $400K.

We decided to start looking. Now this could have gone terribly wrong since we HAD to find a house before the baby is due or we would have to hold off till next summer. We were on MLS daily and narrowed down the search to a few specific builder models. We ended up buying a 1950 Sq foot house that we liked from a open house we randomly visited on a lazy Saturday in the area.

The house was listed at $500K but the sellers agent let it slip that they had to sell by a certain (rather aggressive) date, so we had an advantage. We ended up buying it for $480K.

Next on the list was selling our house. That didn't really stress me out since I knew our house would present well, and we had higher end amenities. We ended up selling for $420K. Yeah that crazy to think that in a year we made over $100K on the sale of our first home.

In a few weeks, we will be moving into a larger house with the same higher end amenities that we like, without a big change to our mortgage (and we were able to pocket a bunch of the profits).

The only crappy part is planning the move (and packing) by myself since my wife can't really do much.

The housing market in my area is CRAZY hot right now. The same model we bought is now selling for $529K. Keep in mind that we signed the papers in late March.

xxracerxx · Apr 30, 2013

flyinpiranha said:
Portland, OR? That's where my fiance will be looking in a year or so. Hopefully will have 10-15% downpayment of a $200-220k house. We pay fairly cheap for rent, nice condo, 1300 SQFT in Raleigh Hills and it's only $1000 so we've been trying to adjust and save what would be our 'extra' for a house payment (probably around $1500).

House prices are going up here unfortunately. My friends bought in Tualatin at $190k and it probably go for a lot more now. I just hope they don't go up too fast, I don't want a $200k house to be $260 in a couple years, that will price us out of the market.

Hate to tell you but the Portland market in your range and even up to $400 is competitive as shit right now. It seems like everyone is looking for a house in that range. The wife and I looked at (as in walked though) over 100 homes (must have looked at over 500 online) and had put offers on 4 and lost out to people paying over asking price. Finally found the perfect place in the NE for us but it took a good 5 months. And prices are just going up and up now.

There is still hope you will find your dream home out there. We did.

Sanky Panky · Apr 30, 2013

Unless the plan is reaaaaally long-term, I see no reason to buy right now, unless you are just simply upgrading (by selling your house), or find a hidden gem of a deal (20-30% below a conservative market value).

If you are in LA, good luck buying now...

johnsmith · May 1, 2013

Just closed on my house. About 35 minutes north of SLC. Took about 30 days from offer to closing, but it was all really painless. Was able to find it pretty easily, didn't look at maybe more than 15 houses. But looking online now it looks like inventory is definitely trying up. All the short sales are gone. But I got a pretty good deal. Original list price was $169K, i got it for 160K + 3% in closing costs. 1650 sq feet, 4 bed 2 bath.

It's in overall nice shape, but there's a lot of little things I need to fix before I move in, plus painting.

captive · May 1, 2013

Zapages said:
would you guys buy a house in a flood zone. Its in A7 flood zone, meaning that it was flooded only once in the past 100 and it was only during Hurricane Irene? The house is going for 250K in a good neighborhood and town.

personally i stay in 500 year flood plan or less. YMMV, 100 isnt that bad, but your going to pay more in flood insurance.

Bought and sold several houses personally and with my parents. Its really not that bad, i dont know why so many on gaf are that negative about it. Just as long as you know its a game and you know that there are tons of hoops from the bank and government.

some of my rules:
location
location
location
if its a bad location, or even remotely sketchy, don't even bother looking.
never fall in love with a house
never fall in love with a house in a bad area, also see 1-4.
When buying a home, inspections are used to lower the purchase price.
When selling a home, inspections are used to lower the selling price.
Inspectors really arent all that helpful, the first 10 pages of the report are CYA for them stating they arent responsible if anything breaks after your purchase. If you have a legit concern about something you need to have a qualified professional come inspect the roof, plumbing, electrical etc. Luckily my brother is a master plumber so he'll do this for me for free, and he knows a bunch of people in the industry.
Always homestead your home(as long as its your primary), seriously, the house my fiancé and I bought last april, the guy didnt homestead it, its 10-20% in taxes that it will save you.
Your taxes and mortgage interest are all tax writ-offs.

thats all i can think of for now.

djblackice · May 1, 2013

AstroNut325 said:
My wife and I have been house hunting since December in Los Angeles. Still no luck. We're targeting homes in the San Gabriel Valley/Pasadena area. EVERY home we have put on offer on has gone for at least $30K over asking price! Oh and the "winners" are also foregoing buyer protections such as appraisal, termite, ect..

We're seeing really low inventory right now (down over 50% year-over-year) and the demand has picked up due to interest rates inching upwards.

It really looks like we picked the wrong time to get into the housing market.

Good luck! Found our place last year right around March 2012 before everything skyrocketed in Orange County. Now places are going for over $200k than what we paid for it. The fact that people are waiving appraisals and termite inspections is nuts. Inventory has completely dried up and I have no clue how it happened so quick.

a secret-boss · May 1, 2013

nice to see GAF as a thread, I've been debating this since I joined the Navy.

I really want to buy a house and rent it out. Las Vegas is my target for house buying and I'm stationed in San Diego.

I really have to clue about buying a house and having a third party collect the money for rent.

(I will attend a Home buying seminar next month though)

nicoga3000 · May 1, 2013

My wife and I are going to start looking in the next month or so. We are in Indiana and from what we've seen, prices are still quite affordable. Hopefully things stay this way for another 4-6 months until after we buy! Although that being said, house prices in the location we are haven't ever seemed too ridiculous.

Sanky Panky · May 1, 2013

a secret-boss said:
nice to see GAF as a thread, I've been debating this since I joined the Navy.

I really want to buy a house and rent it out. Las Vegas is my target for house buying and I'm stationed in San Diego.

I really have to clue about buying a house and having a third party collect the money for rent.

(I will attend a Home buying seminar next month though)

You better get it for cheap! if you have a mortgage on it, after you pay for taxes, insurance, misc. repairs AND someone to manage it for you (around 10% of rent), you will likely be covering the shortfall hoping for price appreciation. That is not investing, it's speculating. Add in time to lease up the property, potential of tenants not paying/vacating, and you really have to know what you are doing.

REITS and funds have gotten crazy buying up houses for rent (economies of scale), and are already getting burned in markets like Phoenix, AZ. Be careful and buy below market.

a secret-boss · May 1, 2013

Sanky Panky said:
You better get it for cheap! if you have a mortgage on it, after you pay for taxes, insurance, misc. repairs AND someone to manage it for you (around 10% of rent), you will likely be covering the shortfall hoping for price appreciation. That is not investing, it's speculating. Add in time to lease up the property, potential of tenants not paying/vacating, and you really have to know what you are doing.

REITS and funds have gotten crazy buying up houses for rent (economies of scale), and are already getting burned in markets like Phoenix, AZ. Be careful and buy below market.

alright thanks for the tip.

never thought of those taxes, insurance, misc repair lol

Skiptastic · May 1, 2013

nicoga3000 said:
My wife and I are going to start looking in the next month or so. We are in Indiana and from what we've seen, prices are still quite affordable. Hopefully things stay this way for another 4-6 months until after we buy! Although that being said, house prices in the location we are haven't ever seemed too ridiculous.

Where are you looking in Indiana? I bought a house back in '09 and would be interested to see what you're looking for and what the prices are.

Dthomp · May 2, 2013

nicoga3000 said:
My wife and I are going to start looking in the next month or so. We are in Indiana and from what we've seen, prices are still quite affordable. Hopefully things stay this way for another 4-6 months until after we buy! Although that being said, house prices in the location we are haven't ever seemed too ridiculous.

How would you rate living in IN. Me and my wife live in ND atm and are considering buying a cheap bank owned maybe in Indianapolis. We sold our house in MN last year and still have around 15k left over and wouldn't mind a fix-er-upper that we could buy outright. Lots of cheap homes but they need ALOT of work

Downhome · May 26, 2013

My wife and I are in the very beginning stages of buying our first home. We were married two years ago this October and have been in an apartment for the entire time. Like many, I see at least a slight turnaround coming (and even starting a bit in our area) and we want to do it now to get as much house for the least amount of money while we can. Her parents are willing to give us $15,000 for a down payment so that is covered. Our max budget will be a final cost after negotiations of around $130,000 give or take with a monthly payment, including taxes and insurance, of around $750. You can get some very nice places with that kind of money here (upstate SC), and you can go as low as $80,000 to get some pretty nice places as well. We are looking for at least the typical 3 bed 2 bath setup with a square footage of around 1,400 and up.

We both have "decent" credit scores above the 640 minimum that most people say is necessary to buy a home. We have not yet tried to get preapproved and we have around $5,500 in credit card debt spread across 5 or 6 different cards. That brings me to my main reason for posting in this thread.

Would we be better off taking part of the $15,000 that we will be receiving and just eliminating every bit of our credit card debt before we try to get preapproval or would it be best to keep that debt and put as much towards the down payment as possible? To us it is more important to keep the monthly payment as low as possible instead of trying to get it paid off as soon as we can. We will likely be able to pay it all off in a lump sum in a few years after we sell off some property that her parents also gave us, mainly for that very purpose. Yes, I know we are lucky to have her parents.

The main thing now is to determine what to do with the $15,000 and the credit card debt. Doing that would free up a few hundred dollars a month that we could then put towards the mortgage, home improvements, put it in savings, or whatever else. Thanks!

Skiptastic · May 27, 2013

Absolutely pay off the credit card debt right now. The extra money you'd add to the mortgage payback would be much cheaper than the credit card debt you have at the moment.

Also, if you have lots of deductions, you can work with the credit card companies to have a one time payoff and you would count the difference as "income". Heck, buying the house will add the interest deduction, which would probably make up for that on your income taxes.

Downhome · May 27, 2013

Would paying off $5k to $6k out of the blue not possibly "hurt" us somehow right before applying? I have no idea how that works, and I have heard mixed things on it. Trust me, I would more than prefer to eliminate it once and for all.

mcfrank · May 27, 2013

Sanky Panky said:
Unless the plan is reaaaaally long-term, I see no reason to buy right now, unless you are just simply upgrading (by selling your house), or find a hidden gem of a deal (20-30% below a conservative market value).

If you are in LA, good luck buying now...

This is so annoying since my wife and I were about 6 months from wanting to buy in LA. We rent in Pasadena now, and my guess is we will continue to rent for a while even though we have enough saved for a 10% down payment if that trend continues. I have no desire to buy in a bubble.

Skiptastic · May 28, 2013

Downhome said:
Would paying off $5k to $6k out of the blue not possibly "hurt" us somehow right before applying? I have no idea how that works, and I have heard mixed things on it. Trust me, I would more than prefer to eliminate it once and for all.

From here:

35 percent of the score is based on your payment history. This makes sense since one of the primary reasons a lender wants to see the score is to find out if (and how promptly) you pay your bills. The score is affected by how many bills have been paid late, how many were sent out for collection and any bankruptcies. When these things happened also comes into play. The more recent, the worse it will be for your overall score.

30 percent of the score is based on outstanding debt. How much do you owe on car or home loans? How many credit cards do you have that are at their credit limits? The more cards you have at their limits, the lower your score will be. The rule of thumb is to keep your card balances at 25 percent or less of their limits.

15 percent of the score is based on the length of time you've had credit. The longer you've had established credit, the better it is for your overall credit score. Why? Because more information about your past payment history gives a more accurate prediction of your future actions.

10 percent of the score is based on new credit. Opening new credit accounts will negatively affect your score for a short time. This category also penalizes hard inquiries on your credit in the past year. Hard inquiries are those you've given lenders permission for, as opposed to soft inquiries, which include looking at your own score and have no effect on the score. However, the score interprets several hard inquiries within a short amount of time as one to account for the way people shop around for the best deals on a loan.

10 percent of the score is based on the types of credit you currently have. It will help your score to show that you have had experience with several different kinds of credit accounts, such as revolving credit accounts and installment loans.

So it looks like it's a good idea to pay off outstanding debt. Taking down the number of cards at their limit is a pretty big deal...

Of course, I'm not a financial expert or authorized financial adviser. If you are looking to get a mortgage, I would talk to the mortgage agent at whatever bank you're looking at and see what they say. But on the whole, what looks more attractive to a lending agent: a couple who have five or six credit cards with high interest to pay off or a couple who have no further outstanding debt?

PS. Given you've gone into CC debt in the past, I recommend doing whatever you can to get a fixed rate mortgage. That way, you don't have adjusting rates and you know what your payment will be pretty much forever.

snacknuts · May 28, 2013

My wife and I are closing on our new home in Indy next Friday. Got a good fixed rate (3.25%, vs. the 6.25% on my current mortgage) and a great deal on our house. We're closing on the sale of my current home on the same day; we've got 14 days of possession after that sale, and the people we're buying from have seven days, so we've got a solid week to move. I'll miss my current house a little bit, but I can't wait to get out of my neighborhood, and they place we're moving is way nicer.

ink4n3 · May 28, 2013

jdirtybird32 said:
How would you rate living in IN. Me and my wife live in ND atm and are considering buying a cheap bank owned maybe in Indianapolis. We sold our house in MN last year and still have around 15k left over and wouldn't mind a fix-er-upper that we could buy outright. Lots of cheap homes but they need ALOT of work

I grew up in ND and moved to IN 4 years ago. It's still very much midwest. There are lots of small rural towns. Indy is pretty comparable to Minneapolis. It seems to me that with suburbs included, the twin cities area is much bigger and generally has more to do. Keep in mind that there are many more major cities in the IN area than in ND/MN (Chicago, St Louis, Cincinatti, Lousiville).

For reference, I grew up in the Bismarck area and went to school in Fargo. I live in Bloomington, IN now which is an hour south of Indy.

AstroNut325 · May 28, 2013

djblackice said:
Good luck! Found our place last year right around March 2012 before everything skyrocketed in Orange County. Now places are going for over $200k than what we paid for it. The fact that people are waiving appraisals and termite inspections is nuts. Inventory has completely dried up and I have no clue how it happened so quick.

Some new programs to help people underwater and pending foreclosure. And a few other programs that took effect at the start of this year. It's probably a bunch of other little causes too.

In the end we dropped out. We found a cheaper place to rent so we can save for a bigger down payment. I honestly feel terrible.

TheExodu5 · May 28, 2013

It's so hard to know when to buy. I'm in Ottawa, where the market's been pretty stable over the last 6-7 years...houses have certainly not decreased in price.

I've saved about $15K in a years time, but I'm afraid that moving forward that I'll be losing more than $15K/yr due to appreciation.

A new ~1300 square ft. townhome here costs somewhere in the range of $300K, so the market is pretty tough to enter in the first place.

AstroNut325 · May 28, 2013

TheExodu5 said:
It's so hard to know when to buy. I'm in Ottawa, where the market's been pretty stable over the last 6-7 years...houses have certainly not decreased in price.

I've saved about $15K in a years time, but I'm afraid that moving forward that I'll be losing more than $15K/yr due to appreciation.

A new ~1300 square ft. townhome here costs somewhere in the range of $300K, so the market is pretty tough to enter in the first place.

Wow... That's still cheaper than Los Angeles! A 1300 sq. ft. Home averages $450,000 USD in an OK (not good or great) neighborhood.

The price of entry is ridiculous. Yes you can find 1300 sq. ft homes in Los Angeles for less money. But you're going to living in gang and violence infested nwighborhoods.

Skiptastic · May 28, 2013

snacknuts said:
My wife and I are closing on our new home in Indy next Friday. Got a good fixed rate (3.25%, vs. the 6.25% on my current mortgage) and a great deal on our house. We're closing on the sale of my current home on the same day; we've got 14 days of possession after that sale, and the people we're buying from have seven days, so we've got a solid week to move. I'll miss my current house a little bit, but I can't wait to get out of my neighborhood, and they place we're moving is way nicer.

Awesome! Indy-GAF is growing! Where in the city are you going to live?

jdirtybird32 said:
How would you rate living in IN. Me and my wife live in ND atm and are considering buying a cheap bank owned maybe in Indianapolis. We sold our house in MN last year and still have around 15k left over and wouldn't mind a fix-er-upper that we could buy outright. Lots of cheap homes but they need ALOT of work

I personally love living in Indianapolis, but I haven't been an adult living anywhere else (outside of college but that doesn't count.) I used to live in the Chicago burbs, and it's great to have Indy traffic instead of Chicago traffic. We have two major sports teams that are inexpensive, traffic is light, parking is pretty cheap, you can walk pretty much the entire downtown district, people are friendly, etc.

Mattlikewhoa · May 28, 2013

This thread reminds me how much I hate the Canadian housing prices versus our American friends...

TheExodu5 said:
It's so hard to know when to buy. I'm in Ottawa, where the market's been pretty stable over the last 6-7 years...houses have certainly not decreased in price.

I've saved about $15K in a years time, but I'm afraid that moving forward that I'll be losing more than $15K/yr due to appreciation.

A new ~1300 square ft. townhome here costs somewhere in the range of $300K, so the market is pretty tough to enter in the first place.

Jump in when you can. Honestly we bought our first townhouse (1500 SQ ft) for $315K in the suburbs of the GTA, and I'm glad we got in because now new build townhomes START in the $369+ range and they are SMALLER then what we had originally purchased.

If you can afford it, I say go for it.

Coverly · May 28, 2013

AstroNut325 said:
My wife and I have been house hunting since December in Los Angeles. Still no luck. We're targeting homes in the San Gabriel Valley/Pasadena area. EVERY home we have put on offer on has gone for at least $30K over asking price! Oh and the "winners" are also foregoing buyer protections such as appraisal, termite, ect..

We're seeing really low inventory right now (down over 50% year-over-year) and the demand has picked up due to interest rates inching upwards.

It really looks like we picked the wrong time to get into the housing market.

We're in a similar situation. We just started less than a month ago and noticed very low inventories in LA. Our realtor basically told us "be prepared to be rejected and outbid a lot!".

My problem right now is that I think my realtor is really slow. Because this is our first time working with a realtor so we don't have anything to compare it with.

For example, how long does it take for you guys to get to see a home once you ask for it? a few days? the weekend of the request? 2 weeks later?

What about putting in a bid once you request it? Is the bid done in a day or two, by the end of the week, or longer?

Mattlikewhoa · May 28, 2013

Coverly said:
We're in a similar situation. We just started less than a month ago and noticed very low inventories in LA. Our realtor basically told us "be prepared to be rejected and outbid a lot!".

My problem right now is that I think my realtor is really slow. Because this is our first time working with a realtor so we don't have anything to compare it with.

For example, how long does it take for you guys to get to see a home once you ask for it? a few days? the weekend of the request? 2 weeks later?

What about putting in a bid once you request it? Is the bid done in a day or two, by the end of the week, or longer?

I can only speak on the agents that we used to buy and sell. They worked as a team. One does strictly buying, and the other selling.

When we were purchasing a house, viewings depended on the person selling. Usually we were in that night, or the following evening after a request. As for putting in a offer, it was placed the same day we had visited the place (that evening).

I have a friend who was looking to buy in a VERY specific area in the city and it was crazy. They were out bid more times then I could count, and there were always multiple offers on every property.

The house that they had finally scooped up, they put in a offer when the sign was being planted in the front lawn.

In most cases, if your agent is not on top of everything, then you could end up losing out on a property.

Coverly · May 28, 2013

Mattlikewhoa said:
Usually we were in that night, or the following evening after a request. As for putting in a offer, it was placed the same day we had visited the place (that evening).

In most cases, if your agent is not on top of everything, then you could end up losing out on a property.

Yeah that's what I thought it was going to be like, or at least something close to it. Waiting till the weekend sucks.

Downhome · Jun 8, 2013

Ok, we got the gift from my in-laws and we took some of the money and paid off all of our credit cards to the point where we have no more than a 25% of the total credit limit on them any more.

We are now interested in a house that is listed at $129,000 and is approved for 100% rural USDA financing. Is mortgage insurance cheaper when you get into things like this? Do any of you have any experience with it?

Also, when finally making an offer, how low it too low to go in at with the offer? I know, our buyers agent will help us with all of that, but I'm still interested to hear what you have to say. Thanks!

NinjaMouse · Jun 8, 2013

Downhome said:
Ok, we got the gift from my in-laws and we took some of the money and paid off all of our credit cards to the point where we have no more than a 25% of the total credit limit on them any more.

We are now interested in a house that is listed at $129,000 and is approved for 100% rural USDA financing. Is mortgage insurance cheaper when you get into things like this? Do any of you have any experience with it?

Also, when finally making an offer, how low it too low to go in at with the offer? I know, our buyers agent will help us with all of that, but I'm still interested to hear what you have to say. Thanks!

I have no experience with PMI, but my advice is to keep looking for lenders. My lender offers 100% financing with no PMI. Don't be afraid to go to a mortgage broker, either, as it's no cost to you (I'm sure they build something in somewhere, but it's invisible for you).

As far as how low to go, there's really no equation. It depends on the market, the property, the current owners' situation, etc. From what I remember growing up in the upstate of SC, a $130k house in a 'normal' situation, you might be able to snag for $125k-ish (something like 4% off), maybe with a grand or two back at closing, but the price on properties there is much thinner. Living in NYC, I typically can pull more off the top of asking price, but the asking prices are through the roof, so 4% off may be $10k or $20k

With all of that said, if you're buying the house from a divorcee or as part of an estate sale, you may be able to come in there and really lowball them at $100k or $110k. Your agent should be able to dig a little into the owners' situation. The problem you'll have is that the agent's commission depends on the sale price, obviously, so it's not necessarily in his (assuming it's a dude) best interest to help you "steal" the house. If he works for a larger realtor, his 3% commission will get cut to 2% or 2.5% or something like that, so he wants you to buy the house as high as possible with the least amount of work on his part. Also, his time investment in the situation may be low, too, if you're a "difficult" buyer as he could have other deals pending that lead to a quicker pay day.

I probably didn't help much, but in lieu of my usual proclaimed hate for real estate, I figured I'd attempt to give some real insight for once =P.

AstroNut325 · Jun 8, 2013

Coverly said:
We're in a similar situation. We just started less than a month ago and noticed very low inventories in LA. Our realtor basically told us "be prepared to be rejected and outbid a lot!".

My problem right now is that I think my realtor is really slow. Because this is our first time working with a realtor so we don't have anything to compare it with.

For example, how long does it take for you guys to get to see a home once you ask for it? a few days? the weekend of the request? 2 weeks later?

What about putting in a bid once you request it? Is the bid done in a day or two, by the end of the week, or longer?

You should be able to see a property within 24-72 hours of you requesting it. If your agent is delaying beyond that he/she is not aggressive enough or is not that interested in you as a client.

Downhome · Jun 12, 2013

I just got our rapid rescore back after having submitted it after paying down our credit cards to having no more than 25% of the total credit line on the account. Long story short it raised the average number between me and my wife from a 685 to a 723!

We are now also looking into USDA eligible homes. If we can find something we really like, we may just go that way in the end.

Coverly · Jun 12, 2013

Oh wow, thank god it's almost basically and finally over. They accepted and signed our offer!

This is literally worst house in the best neighborhood scenario. The neighborhood is what did it. I can always fix the house, but that neighborhood was love at first sight. Beautiful trees, well maintained homes and yards, away from any traffic noise. Just very peaceful and scenic. I didn't think we could get into this area because the two other times I've tried I have been overbid by at least 50k over the asking price, cash. To get this house, even with multiple bids, I had to go over 25k asking price and take it as is. The process wasn't easy. It took about a good week and change for the whole thing. So a lot of restless nights and countering counter offers during the day. But I'm very glad that I didn't spend 1-2 years looking for a home like some friends and co-workers have. I think it's been around less than 2 months since we started. It didn't feel like two months though, time went by very quickly.

The house needs a lot of work to say the least. The structure itself is good (we already did an inspection), but cosmetically it feels like it all needs to be drenched in oil and set on fire. A friend of us is a general contractor so I think we'll work with her to get a gameplan going. We do have a small budget set aside for this so hopefully it's enough for us to move in without major problems that have to be fixed right away.

I'm not too worried about escrow since we were pre-approved and have enough money to cover everything, but my main concern now is what the costs will be to fix up the house. Floors need to be redone, walls painted, some small work on the roof, landscaper, etc.. A lot of the stuff we can do ourselves, but we want to be realistic about not getting overwhelmed.

One thing that I learned from the home search is to be extremely pro active, even if your realtor is familiar with the areas you're looking at. I would update my realtor almost every other day with a ranking of what i was looking at with explanations. Marking possible houses, going to public open houses, requesting to see homes continually gave us a real education as to the realities of home buying versus what we thought it would be like. And the more and more homes and condos that you see help you form a better idea of what you like or what's important. I think the first week or two of looking at houses we tried really hard to make every home work in our minds, but afterwards it was easier to reject or accept certain features or lack of in a home because of seeing so many styles.

AstroNut325 · Jul 23, 2013

Just came across this chart:

So... essentially... housing is now more UNAFFORDABLE now than it was in 2006/2007! WTF?

Are first time (real first time) buyers like me forever priced out of owning real estate? Most agents I talked to say that the bidding wars have only become more aggressive. Anything short of major income surges... I'm having a hard time picturing myself getting a property in the San Gabriel Valley.

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