Izzy Posted July 18, 2014 Share Posted July 18, 2014 Hi all. I'm looking to move into a house that was built in 1950. The lady that lived there had it for decades and it shows. The realtor selling it has had it on the market about 2 months. Here's a link to the house: My link I've already looked at similar houses (still a couple more to go) but this one feels right. Feelings shouldn't come into play however and it is far from perfect condition. Good people, I am seeking opinions and tips. What to look for inside the house, what to ask the realtor, etc... Yes, I already googled buying tips and so on, but there are wise folks on this here forum and the conversation may become really interesting. Is buying a home even worth it? Is the market getting better for selling (I'm looking to sell this one)? Should I buy in full or put down a big chunk instead and pay the mortgague for any reason? Link to comment Share on other sites More sharing options...
xkimo Posted July 18, 2014 Share Posted July 18, 2014 Hi all. I'm looking to move into a house that was built in 1950. The lady that lived there had it for decades and it shows. The realtor selling it has had it on the market about 2 months. Here's a link to the house: My link I've already looked at similar houses (still a couple more to go) but this one feels right. Feelings shouldn't come into play however and it is far from perfect condition. Good people, I am seeking opinions and tips. What to look for inside the house, what to ask the realtor, etc... Yes, I already googled buying tips and so on, but there are wise folks on this here forum and the conversation may become really interesting. Is buying a home even worth it? Is the market getting better for selling (I'm looking to sell this one)? Should I buy in full or put down a big chunk instead and pay the mortgague for any reason? Buy the least expensive / newest home in your price range in the most expensive area which you can afford. Homes this old unfortunately come with a lot of baggage. Plumbing,electrical,insulation,etc. Current conditions being what they are,these days,the wife and I are just glad we can keep our mortgage paid,keep up with the maintenance,keep the gas & power on with food on the table. We have owned several home in our lives around the country.I remember the lean days of rent...Not for me,but then again ownership isn't for everyone either. Do your due diligence in all things..Have $ to begin with in case the unthinkable happens... Don't be fooled by the flipper shows on the tele either.. I have lived in Houston,currently domiciled near Las Vegas N.V. lot of people lost everything buying into the flipper idea.. Due Diligence Izzy. Good luck. X Link to comment Share on other sites More sharing options...
jannusguy2 Posted July 18, 2014 Share Posted July 18, 2014 Get a thorough inspection and appraisal before making any decision. There are people who would argue against homeownership these days but for me, it's my most valuable asset. I think that holds true for many folks, still. I've lived in mine for 15 years and I re-fi'd it last year. Despite having an excellent credit rating, never missing a payment and having a 40 + year relationship with the lender, it was still a brutal process getting the loan done because I'm self-employed. I knocked 2.5 % points of off the loan though so it was worth it. Depending on your situation you may be forced to use cash if you have it. The mortgage interest deduction on your taxes is still a valuable device if you finance. If the place feels right, do your homework and go for it! Good luck! Link to comment Share on other sites More sharing options...
capmaster Posted July 18, 2014 Share Posted July 18, 2014 Not an easy task. Bought a home in 2003 with my then-wife, and we sold it five weeks ago, so it is in progress yet. There are so many factors, personal and economical ones. Possible planning on a family and impredictable perspectives on income are important and may change everything within a moment. When thinking about possibly moving one day, it is easier to live in a not-so-perfect home oneself than renting it out. Infrastructure, climate conditions, and bad forces of nature like earthquakes and floods are points I would consider thoroughly. Checking insurance charges for the particular risks in the given area might help. Price development can vary strongly with region and may depend on economical things you can't change. For the moment they keep on rising here, but the situation is hardly predictable in the long run. Finally, buying a home can be a valuable investment when thinking about possible loss of money through currency devaluation. On the other hand, a proletarian revolution would change it all, and will rather happen in the long run than so soon, at least globally. Any privatization wave WILL be followed by a socialization wave, it's just a question of time. Link to comment Share on other sites More sharing options...
Riffster Posted July 18, 2014 Share Posted July 18, 2014 Something I have learned is that if a house is on the market for that long there is a reason, sometimes it is just the price but it can be tricky to find out why. An appraisal is a good way to start but look up the housein Zillow.com and see the estimated value, look at the tax record for appraised values, square footage, etcetera. Make sure the house has no liens if you buy it. Condition wise even with an inspection all things that need to be fixed may not surface, it seems to me inspectors do not want deals to fall through and they do not do a thorough job. Make sure the electrcal is inspected, fuse box and all. Plumbing is important too but usually issues are isolated. Find out the age of the roof and air conditioner. If the house is not on a slab walk around and check for sagging floors. Link to comment Share on other sites More sharing options...
4Hayden Posted July 18, 2014 Share Posted July 18, 2014 Just make sure you have it inspected and it has a up to date bug policy. Link to comment Share on other sites More sharing options...
Kaiser Bill Posted July 18, 2014 Share Posted July 18, 2014 Best of luck with you latest endeavor. I just moved 1,100 miles from Pa to Fl 9 months ago. Moving can be stressful. Don't let it get you down. Link to comment Share on other sites More sharing options...
Californiaman Posted July 18, 2014 Share Posted July 18, 2014 Izzy: A lot of old, bathtubs from the time your house was built can be touched up for a couple hundred dollars. It's a simple task of cleaning and spraying on a new enamel coating. Don't like the condition it's in or the color, spray coat it. That will save you money $$$ in the long run and it will look brand new. Tile around your tub can be recoated as well. Also, if there is mold around the calking, you're going to want to check behind the wall. Often, that's where it started. Often, you'll be surprised at where it started. Definitely get the home inspected. Have the inspector make a good punch list of things to be aware of. Have the inspector walk the property with you when he or she is finished with the inspection. Remember, it there are things to do around the property, you have nothing but time to improve them. Most of the people around me have had to do a little of this and that to bring the property up to their standards. "I walk around my property and see what we've done since we bought it. Here's $5,000.00 there's $10,000 there's a couple hundred bucks. Here's a couple pictures of our latest endeavor. We're puting in about 20 yards of concrete for our patio. Next is irrigation, crushed granite walkways, a fire pit and some carefully placed oak trees around the fire pit. I also have some very nice dawn redwoods that I've grown from seedlings. They're beutiful trees and will certainly look great in my backyard. Link to comment Share on other sites More sharing options...
Tman Posted July 18, 2014 Share Posted July 18, 2014 Just bought a home last October. Major fixer upper. Completely worth it for us. Feelings had a lot to do with it. In my opinion, if it feels right, go with it, you will live there, not anyone else. Yes go into it with eyes open but if you can afford it, you feel good about it and have a plan for making it yours go for it! Don't look back and say damn, that would have been perfect. Our inspections showed rotten floors, dry rot, termites etc.etc. Best decision ever cause we are slowly fixing into something that is unique and all ours. Also the tax advantage. Big attraction. Link to comment Share on other sites More sharing options...
Rabs Posted July 18, 2014 Share Posted July 18, 2014 Hey Izzy.. hows it going.. got any more new tunes for us? :) Well I cant tell you much about the US property system.. But DAMN... 70k for a whole house... in London the smallest box room apartment you can imagine (yes, that's one room and a toilet) costs way more than that.. madness... And a 1 bed apartment in an average area costs about £150,000... So to me that looks amazing. What I wouldn't give for a property that size (I could use it as a workshop too). Link to comment Share on other sites More sharing options...
Californiaman Posted July 18, 2014 Share Posted July 18, 2014 Just bought a home last October. Major fixer upper. Completely worth it for us. Feelings had a lot to do with it. In my opinion, if it feels right, go with it, you will live there, not anyone else. Yes go into it with eyes open but if you can afford it, you feel good about it and have a plan for making it yours go for it! Don't look back and say damn, that would have been perfect. Our inspections showed rotten floors, dry rot, termites etc.etc. Best decision ever cause we are slowly fixing into something that is unique and all ours. Also the tax advantage. Big attraction. We too bought a fixer upper. We knew going in that it was a house that needed a cash infusion and some love. Before we moved in we did all of the flooring, hardwood through out most of it but carpet in four bedrooms and tile in one bathroom. We had the ceilings hand textured and added crown molding and new baseboard throughout. We also painted inside and out. The back yard landscaping removal took several trips to the dump and about $3,000.00. My side yard, which everyone in the neighborhood can see when they come around the corner, was transformed from several odds and end plants and shrubbs to a beautiful row of Icelandic roses. The front of the house next to the front porch is a beautiful garden with white carpet roses, rocks, and a crimson queen japanese maple growing right in the middle. It's grown into quite the garden from its' humble beginnings. The roses have grown to three or four times their size since I put them in two years ago and the maple has filled out quite nicely too. After cleaning out the planter beds of weeds, we filled them all with red mulch. It really has added pop to our landscape. Link to comment Share on other sites More sharing options...
Hoya Posted July 18, 2014 Share Posted July 18, 2014 Also be sure to visit the neighborhood at various times during the day to get a feel for the neighborhood activity. I see it's near Hobby Airport. Do you mind planes flying over? Link to comment Share on other sites More sharing options...
Izzy Posted July 18, 2014 Author Share Posted July 18, 2014 Caliman, that is an amazing house. The best thing is the pride you have because you put it together yourself. If others have pics of their homes and of work they've done, that would be awesome to see. Great advice on the tub. I imagine you can do the same with the sink? I dread some of the work, like tearing out carpet and painting and patching a hole here and there...I have to ask myself "better to work that extra set of days and pay pros or do I really save LOTS if I do that sort of thing myself?" What I've done so far is Look at houses of similar size with the same number of rooms and bathrooms in the same neighborhood (both on HAR and in person). Ask the agent selling the house I like for a list of "comps" to see what they've been selling for (not just what people have been asking). Looked at the house I like three times opening drawers, turning on window units, flushing toilets making mental notes of obvious fix needs. Gone to it on a weeknight and driven a few blocks about it looking for signs of danger and checking the street lighting. Is it better to put a good chink down and pay a mortgague for any reason or just pay it off, savings-be-damed? I had an accountant friend tell me banks get more respect when it pertains to insurance claims (fire)...he also said, "don't pay off, use the $ in investments that give better return." Thoughts? Link to comment Share on other sites More sharing options...
'Scales Posted July 18, 2014 Share Posted July 18, 2014 Rabs, I'm in the same boat as you. Houston is about the same population as Sydney roughly. In Sydney the most basic 3 br house in the least desirable areas would have to be $300,000 US at least. Even in the country town nearest to where I live you couldn't get a house for $70K for about the last 15-20 years and you would not even get a unit/flat/apartment for $70K there today. In the cities you'd be looking at a caravan for $70K! For 70K here you'd need to be in some outback town with no prospects for anything. USA house prices are like car prices in Oz, and we still pay (albeit 'all time low') interest rates of c6% I think and high personal income tax and GST/VAT. Australians would be generally unaware of all this as its been this way for a long time and might wonder what US citizens do with all their leftover money not being spent on home repayments/mortgage interest. (just kidding there guys, I realise you pay massive healthcare costs and have to put money into retirement schemes ) So Izzy I'd be buying it (or anything at that price) in a flash without any due diligence at all - but from a completely different perspective on these things - and in no way recommend you do it like that. Thanks for sharing - its fascinating to see just how these things vary in different parts of the world - in this case the highly developed western world countries even. Best wishes in your endeavours! Link to comment Share on other sites More sharing options...
quapman Posted July 18, 2014 Share Posted July 18, 2014 Is buying a home even worth it? Is the market getting better for selling (I'm looking to sell this one)? Hey Izzy. Congrats on buying a home. Always stressful. I am in my 4th home. I sold all my homes privately and one was purchased privately. When I did work with a realtor I made it clear to them I was not listing my sale with them but I would view/purchase with them. Because let's face it. The are far more listed homes than private. Here that is. I assume the same is true there. My advice would be to do your homework and learn about red flags for things like structural integrity, wiring, fuse panel, water drainage from your foundation and in the neighborhood. Home inspections are good but they are more for the bank. I have never had one tell me something I didn't already know. Appraisals are also more for the bank than for you. What i would do is this. I don't know if realtors there do this but the one i worked with sent me weekly links to listings filtered on my criteria. I could see what the asking price was. How long on market it was. And most important, the selling price. This was huge data to have when putting in an offer and making smart counter offers. Im happy to be in what i hope is my last stop before the old folks home. As for not paying it off as soon a possible zi just don't understand that. Just make sure you have enough left over to do any repairs or renos you want done and pay off ad much of that biatch as you can. Good luck Izzy. Even though it's stressful, it's still pretty exciting. Try and enjoy it. But do educate yourself before jumping in. I have seen many make very bad decisions, with a thumbs up inspection. Link to comment Share on other sites More sharing options...
Tman Posted July 18, 2014 Share Posted July 18, 2014 Is it better to put a good chink down and pay a mortgague for any reason or just pay it off, savings-be-damed? I had an accountant friend tell me banks get more respect when it pertains to insurance claims (fire)...he also said, "don't pay off, use the $ in investments that give better return." Thoughts? Everyone is different and I was given loads of advice. I cashed out my 401K for the downpayment and have a big mortgage but you know, that's what I am working for, to have a place that makes us happy. My wife is ecstatic. Would do it again in a flash. My mortgage is mostly interest which is tax deductible. The tax advantage is so worth it, at least in California. I know from when I lived in Texas that there wasn't state income tax (if I remember correctly). You then get a proportionally bigger deduction. Caliman that is an outstanding job you've done! Awesome. We are going slow because there is so much to do. First week in the house I went to try to open a back door and stepped through the floor. First project, new flooring. Laminate though, not nice hardwood. Babysteps! Link to comment Share on other sites More sharing options...
Californiaman Posted July 18, 2014 Share Posted July 18, 2014 Everyone is different and I was given loads of advice. I cashed out my 401K for the downpayment and have a big mortgage but you know, that's what I am working for, to have a place that makes us happy. My wife is ecstatic. Would do it again in a flash. My mortgage is mostly interest which is tax deductible. The tax advantage is so worth it, at least in California. I know from when I lived in Texas that there wasn't state income tax (if I remember correctly). You then get a proportionally bigger deduction. Caliman that is an outstanding job you've done! Awesome. We are going slow because there is so much to do. First week in the house I went to try to open a back door and stepped through the floor. First project, new flooring. Laminate though, not nice hardwood. Babysteps! Thanks TMan. It's like my neighbor said, "You can't do it all at once. Just a little at a time." When we bought this house, we had been looking for nearly two years. We had actually put the house hunt on hold because we just weren't finding anything that fit our family needs. Then a house in the same neighborhood as my cousin came on the market again. We looked it over, realized what we needed to do to it and got busy. Now... Izzy, we paid the traditional 20% down on a $500,000 dollar property plus an additional $10,000. We have substantial equity built up as our house is now worth about $900.000.00 and the surrounding houses have increased in value substantially too. We also refinanced after one year and got an even lower interest rate on the loan. So... If we sell it, we'll do nicely on the amount of money we make. My advice, for what it's worth is to pay as much as you can on your home. Also, if you can make an extra payment every year, that'll help you out too. Good luck. Link to comment Share on other sites More sharing options...
flyingarmadillo Posted July 19, 2014 Share Posted July 19, 2014 Hi Izzy, You're going to have to put up with the planes from Hobby which is one of the things keeping the price down, the same house in the Energy Corridor (where I am) is at least $40K more and the same house in the museum district is probably at least $200K, so it looks like a decent price. I'd check and see how the neighborhood is doing price wise. If it's been flat for the last year I'd consider looking elsewhere, right now the Houston market is mostly on a huge upswing. We bought ours at the bottom of the market here and it's already increased 50% in 3 years. The rest of it is sweat equity or finding a reliable handyman to help where you can't do it. This doesn't take too much work: Link to comment Share on other sites More sharing options...
surfpup Posted July 19, 2014 Share Posted July 19, 2014 I would just reaffirm something a few others have mentioned... a good and thorough (and impartial) inspection. We paid a few hundred dollars to get this done, but we got a notebook full of details and pictures explaining what things needed the most work. Most of those have come to pass - ie, the inspector was spot on and those were the things that needed attention. He gave us things like pictures of the trusses that showed possible roof leakage and even pictures of the date codes on the AC compressor. We went in knowing what needed work. We were better able to negotiate a reasonable price and create a list and timetable of projects that needed to be done. That inspection may have been the best money we ever spent. Link to comment Share on other sites More sharing options...
Riffster Posted July 19, 2014 Share Posted July 19, 2014 Is it better to put a good chink down and pay a mortgague for any reason or just pay it off, savings-be-damed? I had an accountant friend tell me banks get more respect when it pertains to insurance claims (fire)...he also said, "don't pay off, use the $ in investments that give better return." Thoughts? The ideal right now I would say is put 20% down so you do not have to have two mortgages and insurance on the first mortgage. Then if you can wing it finance the house at 15 years, with the interest rates today it is a no-brainer. With the sale price for that house you posted you will not be paying enough interest to be a tax advantage, maybe the first year but that's alright the tax break is over interest you pay so it is not exactly a huge break. Do not pay off the mortgage, I have the money to pay off our house but I will not, remember if your mortgage is fixed your payment will be the same in 10 years regardless of inflation. Also the bank has some of the risk, one day if you for any unforeseen reason you have to walk away from the house you would lose less (extreme scenario of course). I refinanced at 3.375% 4 years ago, I have 11 years to pay off our house with a comfortable payment, we saved a whole lot of interest by refinancing, like $118,000. That's future money value so who knows what that means but on paper we saved that much. Mortgage rates are estimated based on an average of years people spend on their houses before they move or sell the houses, I think the average is like 6 or 7 years, if you are staying in your house longer than that you are beating the system. Link to comment Share on other sites More sharing options...
Izzy Posted July 19, 2014 Author Share Posted July 19, 2014 Okay, so far I know to... Get an inspection with MY own inspector. Before I make an offer. As for paying it off, there are two opinions. Buy to avoid interest or put down the 20% and share the risk with the bank. Anyone other than Riff think not paying off is a good idea? Link to comment Share on other sites More sharing options...
deeman Posted July 19, 2014 Share Posted July 19, 2014 From the pics i could see, the house could use some work, but nothing a DIY-er couldn't do. Def get the inspection. 70 grand seems like a steal to me. I don't know if thats the going rate in that area of houston, but i got a house for just shy of 200 grand outside chicago and to me that was a deal as most houses around here are above 300. So make sure the area is nice and that the house isn't going to fall apart! If it looks good get it immediately. Link to comment Share on other sites More sharing options...
fortyearspickn Posted July 19, 2014 Share Posted July 19, 2014 Get two inspectors. I've seen them do inspections in homes I've been selling and miss a lot. Give the second guy the first inspection and tell him you want him to find what else is wrong, not just a repeat of "the low hanging fruit". Look critically at the other houses on the street. If they are not being "improved", only kept up - the neighborhood is not going to support your "investment" in the house or costly improvements in terms of growth. Link to comment Share on other sites More sharing options...
Riffster Posted July 19, 2014 Share Posted July 19, 2014 As for paying it off, there are two opinions. Buy to avoid interest or put down the 20% and share the risk with the bank. Anyone other than Riff think not paying off is a good idea? There are several pros and cons to financing or paying off. The best alternative is where exactly you are in your financial position and in the end it is "a decision" For instance if you can wing paying the $70k and will have extra cash in your savings, that is definitely an option. If you are "paying it off as much as you can" but still owing money that gets more complicated. If you have the cash and do not think you can invest it in something that will yield more money than your interest rate then use the cash to pay your house, If you can pay it off then you will have cash flow by not having a mortgage, you could put more on your 401k if you don't already max it for instance. your insurance should be lower too if you own the house, depends on the company. Also, if you can get request Chicago Title to issue the Titlte Protection policy (can't remember the term), go that route, my titile was insured by a sh!tty company that went bust, they did not even issue an actual policy, you know how I learned all of this? you don't want to know. Chicago Title has been around for more than 100 years and they are not going anywhere. Link to comment Share on other sites More sharing options...
badbluesplayer Posted July 19, 2014 Share Posted July 19, 2014 Yay! Looks like a nice place! Yes - Get a home inspection by a certified inspector. Also get a bug inspection. They say "AS IS" in the listing, so I guess that means they're firm on the price. Even if you can't use the inspections to negotiate the price, it still can keep you from buying a "lemon." Do a few drive-by's to see what the neighborhood feels like at different times of the day. Link to comment Share on other sites More sharing options...
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