Building A Home

[aljdewey]

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On 10/20/2004 8:46:18 AM wonka27 wrote:

This is quite complicated! I wish I could do all that research, but it is tough in today's market. When houses go up and down in 48 hours, how does one get the full analysis. ----------------

The truth is, once you've spent a bit of time in the market, you get a pretty good feel for what it will bear.

Don't rush into buying a house....houses are like diamonds; there is ALWAYS another one.

Having said that, if you find the house of your dreams right away, make the offer straight away. This research doesn't have to be done *before* making an offer.....most of it can be done in the 10 days between acceptance of your offer and signing the P&S agreement. If you find ANYTHING during that time that doesn't gel with you , you can withdraw.

The key thing to understand before making an offer is price, and you can get a good feel for that by spending a day or two on one weekend reviewing what other homes have sold for in the last year in the area and what others homes are for sale.

 

[aljdewey]

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On 10/20/2004 8:46:18 AM wonka27 wrote:

This is quite complicated! I wish I could do all that research, but it is tough in today's market. When houses go up and down in 48 hours, how does one get the full analysis. ----------------

The truth is, once you've spent a bit of time in the market, you get a pretty good feel for what it will bear.

Don't rush into buying a house....houses are like diamonds; there is ALWAYS another one.

Having said that, if you find the house of your dreams right away, make the offer straight away. This research doesn't have to be done *before* making an offer.....most of it can be done in the 10 days between acceptance of your offer and signing the P&S agreement. If you find ANYTHING during that time that doesn't gel with you , you can withdraw.

The key thing to understand before making an offer is price, and you can get a good feel for that by spending a day or two on one weekend reviewing what other homes have sold for in the last year in the area and what others homes are for sale.

 

[fire&ice]

Al, while I admire your research, we have never bought a house like that for us to live in or for spec. But, adjacent neighborhoods & neighbors are always something important. NEVER rely on the real estate people. They don't work for you. You don't pay them. PERIOD.

We identify a neighborhood (location location location)& go on my gut & my husbands schooling in Arch & construction. It has also been our experience that older people's homes *have been* very well maintained as far as systems, roofs, etc. It's the cosmetic stuff (including kitchens & bathrooms) that have not been updated & they kinda have that old person smell that can turn off potential buyers. That is why estate sales have been a boon to us in flipping & turning our friends on to them. And, it's true of my parents house & my in-laws house. Both have new roof, updated plumbing, updated electrical - but old fashioned every thing else. Which is the only thing most people see.

Getting back to location location location. Also, if you can identify an up & coming neighborhood before prices spike. I follow the gays, young single professionals & artsy people. The neighborhood may be spotty w/ some renovated homes & some not. Also, it's a good sign if you see a neighborhood w/ lots of young people & lots of old people. We've made our most money in these neighborhoods.

Look beyond the clutter. Look beyond what it "looks" like. You would be amazed how many people can not see beyond decorating & landscape. The most important things are the layout, systems, roofs, etc - things you can't change w/o significant expense. Also, homes that have ceramic tile & wood flooring instead of Vinyl flooring & carpet always go to issue of craftsmanship. And, Wonka, it very well could be the handicapped stuff. Also, ranchers aren't the hottest homes right now. Bungalows have replaced the little cape cod as the darling of the real estate market. I have a feeling that a well done rancher w/ cool pine paneling & large family rooms could be the next darling. So many people are looking for single story homes these days.

Also, researching costs of renovations will serve you well. Get an idea of running foot of middle grade cabinets, countertops, etc. That can be accomplished by a trip to Lowe's. Matata had a good idea about towing along someone who knows construction &/or Architecture. Hubby has done this for lots of people (and ourselves

)

And, don't shut yourself out to problematic things. We nearly bought the house up the street from us. Cute as a bug in a rug - it had been a rental house & was a wreck inside as far as paint peeling & scuffed up walls. Systems were good. It had to be disclosed that there was an asbetos removal problem. We priced it & it wasn't very expensive to remove. Unfortunately, we let the ball drop as we were traveling. A realator bought the house. Spruced it up w/ new cabinets, lots of paint & cute flower in pots on the front - and sold it for about 40k more in a very short period of time.

You can tell collecting houses have been a money making hobby for us. And, maybe I do go through all the motions subconsiously; but, at the end of the day, I trust my gut.

Good luck. The right place will come along if you don't force it.

 

[fire&ice]

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On 10/20/2004 8:46:18 AM wonka27 wrote:

The listing says the roof was in 97 (which I suppose isn't terrible), newer storm doors, and replacement insulated windows. As for the heating/central air systems, I don't know, but will definately find out.----------------

Roofing is usually rated by how many life years. Typically an asphalt roof has a life of about 20 years. Another question - was the roof replaced or reshingled.

Also ask about the electrical system - make sure it's a breaker box & that the system can handle to electrical work load which is significantly more than days gone by. I believe it was in the late 70's when they were using some wiring that turns out not to be good.

 

[aljdewey]

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On 10/20/2004 10:39:51 AM fire&ice wrote:





Al, while I admire your research, we have never bought a house like that for us to live in or for spec.

We identify a neighborhood (location location location)& go on my gut & my husbands schooling in Arch & construction----------------

Well, perhaps that's the reason you've never had to "buy a house like that".....if me or my husband had schooling in architecture and construction, we too would likely be able to eliminate the need for such research.

Perhaps the market wasn't as insane when you bought as it is now......hell, in my area, homes have risen more than 25% of their value in the last 12 months. Without doing a bit of research to see that it's indeed so for this area, I'd be suspect. It's hard to understand why.....until you see that plots of land that were selling for $50K just four months ago are going for $100K now because there is SO little developable land left.

For those of us who don't have construction schooling, it's very easy to be deceived on what a house *should* run. For example, the house we placed a bid on this afternoon: when we saw the house on Saturday, I noted that the asking price ($369,900) was quite a bit steeper than other homes in the area. The response was to point to the ONE house that just sold for $375K. Little did he know, though, that Rich and I had been IN that house.

We know that it had $10K custom kitchen cabinets, hand-laid hardwood all around, ceramic tile, upgraded trex decking, pull out shelving in the maple cabinets, steel I-beam construction in the basement, 2x6 exterior walls with more insulation, light fixtures that were WAY above standard, a built-by-hand front brick porch, and ethernet wiring throughout. OH.....and that house was also 400 sf. bigger, although 3000 sf less land.

The house we're bidding on had NONE of that.....he admits he's used $30 cheapo light fixtures from Home Depot (because people change them anyway to what they like.) Fine....but then the price of the house should be adjusted accordingly. This guys wants the same price for his house even though his outside porch light was $6 and the other house was $50. These two houses weren't even remotely comparable. It would be like comparing a KIA with a Volvo.

Without doing the research, I wouldn't have known that. Three months ago, I had no idea what 2 x 6 construction was, what trex decking was, what constituted conservation land, what it means when a road is "on paper" but not in existence......and these are ALL things that a) affect the value of your house down the line and b) affect the reasonability of the asking price.

I'm not saying it's the only way to buy a house. Clearly some folks buy diamonds by the numbers, and there are a bunch of folks who, like you, rely on their gut. Heck, some folks give more thought to what they are going to wear to a party next week than they do to what's involved in getting married, having children, or buying homes.

Do what works for you. I'm simply sharing what is working best for me and what has helped me get a grasp on how to make an informed decision on housing.

Most people that come to PS are researchers by nature.....they want to make sure they are getting a fair price. If they willing to do that for a diamond, I can't imagine being unwilling to do that for a home purchase.

 

[fire&ice]

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On 10/20/2004 9:21:50 PM aljdewey wrote:

---------------- Perhaps the market wasn't as insane when you bought as it is now......hell, in my area, homes have risen more than 25% of their value in the last 12 months.

. It would be like comparing a KIA with a Volvo.

Without doing the research, I wouldn't have known that. a) affect the value of your house down the line and b) affect the reasonability of the asking price.

I'm not saying it's the only way to buy a house. Clearly some folks buy diamonds by the numbers, and there are a bunch of folks who, like you, rely on their gut. P>


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Nope, we are still buying. The market is crazy every where. We aren't keeping the houses as I think the market is inflated. We are keeping the one we travel to as it was bought in that weird bubble right after 9/11. Admittedly, housing prices are really low compared to most parts of the country. In our neighborhood, a cute as a bug in a rug house with minimal problems 3 bedroom/2 bath can cost one less than 200k and we are in the most desirable zip code & an old established neighborhood (don't know if that's the way your real estate is judged).

Another car analogy.

I've said this before - just pick one.

Your research time is costing you money. I identified our first house & neighborhood w/o the aid of my trusty Architect. I can't fathom someone not knowing what an updated electrical box looks like. Or what an updated heating system looks like. And, you go through the drill. When was the electric updated, systems etc, life of the roof? People should have all this information available. And, if they are lying, the home inspection will usually discover it. If anything, visiting new construction neighborhoods are the best education to see what a house should look like in terms of systems.

At the end of the day, it just should feel right. That's the way I buy. Not for everyone - but for some I think they can over analize things to the point that the right gem may be right in front of them.

And truly, real estate agents would not be happy with my revealing the best secret in real estate - estate sales. They get a lot of listings that way & being able to buy & flip. It's usually either to settle an estate or the older occupants are scaling down & moving. They usually have enormous equity (if not out right own) & while usually priced according to market, they are flexible. Another trick - if you see a really cool property that is for rent, call and ask if they would like to sell. These are the behind the scenes transactions. By the time it makes itself to MLS, it's too late.

Wonka, good luck.

 

[wonka27]

Thank you!

An offer may go in tonight.

I will give ya details later...

Thanks to all for the great advice