First Time Home Buyer, Advice Please (Atlanta, Marietta: fit in, for sale, real estate market) - Georgia (GA) - City-Data Forum

Melissa05 · 02-13-2008, 04:09 AM

I'm a single 21 year old with no children, and I recently inherited some money. I want to purchase a home cash in the $150K-200K range. I want to get the best deal I can because I need something left over for furnishings and savings. I want to know how much less to offer from the listed price, or if it makes a difference that the builder I'm buying from is paid in full at the time of the purchase? I would contact an agent, but my ultimate goal is to save as much money as possible, and get this best out of my situation.

I also wanted to know if anyone recommended a certain area or builder that I can look up? I want to stay closer to Marietta, but the newer homes in Marietta are more expensive than what I want to pay . I also don't want to live too far out in the boonies and drive miles just to get to a grocery store lol.

Thanks for reading and helping!

Melissa

lastminutemom · 02-13-2008, 04:31 AM

First, you need to really understand the market before purchasing a home. While prices are falling (slowly) in the metro Atlanta area, the question is when will they stop falling and start rising. Some experts believe it could be as long as 5 (or more) years until prices start to rise. (they certainly may level off before then -- and some experts believe that the improvement will be seen as early as 2009) I tell you all this, because while historically real estate is a good investment, it must be viewed as a long term one. You can no longer count on buying a home in 2008 and being able to sell it for a profit in 2010. You are young and lots could change in your life... keep that in mind. You might meet someone and want to leave the area, find a great job elsewhere, just decide yu want to move.

In my opinion, new construction, especially in neighborhoods that aren't complete, is very risky. You also need to avoid, in my opinion, neighborhoods with lots of for sale signs.

Second, take a first time homebuyers course. Even though you don't want/need a mortgage, you can take these courses through a lender. You need to understand all the expenses associated with homeownership. (It is much more than just a mortgage.)

Finally, using a realtor generally doesn't cost the buyer anything, and in your case, not using one might cost you a lot. The seller sells the commission and in this market, I am guessing, anyone selling by owner is willing to pay a commission to a realtor just to get their home sold. Home values are really fluctuating right now and comps from a year ago really don't tell the story. I heard that some banks are now only allowing sales that occurred within the last 3 months to be used for appraisals.

One more caveat, in your price range there have been (will be) lots of foreclosures. A good realtor can really help you find a deal-- but you only want to purchase a foreclosure in a neighborhood where there aren't many.

Melissa05 · 02-13-2008, 04:43 AM

Thanks for your reply. I was also looking at foreclosures but I didn't understand if it was the best choice since I was reading "sold as is" or "no warranty." Some of the houses did look beautiful on the outside for the price asked. I will contact a realtor to help because this is such a big deal for me and I don't want to make any mistakes from lack of knowledge. Thanks again.

Melissa

Susan Church · 02-13-2008, 06:56 AM

Melissa,
Last minute mom is right on with her note to you. You do want to speak to reliable Mortgage Companies, mortgage interest is a great tax write off and then your cash remains available to you, not tied up. The best bet for you would most likely be a very well maintained and updated Resale. Foreclosures are very risky, especially if you are on your own. A good realtor can offer much needed guidence to get you through the process. There is no money to be saved if you approach a builder with no realtor of your own. The Listing realtor represents the Seller, if they are working the whole deal it merely means they are getting all the money two would have recieved and that no one is looking out for you. I would happily supply you with names if needed let me know.

brook2ga · 02-13-2008, 07:12 AM

If you can get one, you might consider a small mortgage, and invest some of your cash. Agree that you need representation also. Good luck!

Melissa05 · 02-13-2008, 07:25 AM

To SusanChurch: I have no idea how a lot of this works, but the information shared was greatly appreciated. I'm glad I found this site! I would also appreciate if you gave me that information on realtors.

Melissa05 · 02-13-2008, 07:31 AM

Quote:

Originally Posted by brookdaleresident

If you can get one, you might consider a small mortgage, and invest some of your cash. Agree that you need representation also. Good luck!

In my inheritance, there is real estate as well as stocks and bonds already invested. The real estate is in another state that I don't plan on moving to, but I want to take a little bit of that money to purchase a home here in Atlanta. Just a another question...does it make a difference whther I buy it cash or go through a lender? I know the tax bracket is different, but I've always liked buying things with cash rather than using credit cards, loans, etc.

plessthanpointohfive · 02-13-2008, 12:07 PM

If you can qualify for a good interest rate on a 10 or 15 year mortgage then I wouldn't pay cash for a house. Put down 20-50% and then invest the rest of your cash.

brook2ga · 02-13-2008, 12:41 PM

Quote:

Originally Posted by plessthanpointohfive

If you can qualify for a good interest rate on a 10 or 15 year mortgage then I wouldn't pay cash for a house. Put down 20-50% and then invest the rest of your cash.

Agree. If you can get a good rate on a loan, and invest that cash at a high rate, the tax benefits will be to your advantage. You'll also build up some good credit (if you don't already have it).

scgraham · 04-19-2008, 03:38 PM

I disagree with some of these posts. If you don’t readily need the cash on hand, then paying cash for your home can be a great idea. The interest on a mortgage will be in the 5% to 6% range. If you are fortunate, the interest that can be earned on a CD is about 3% -- and it will be taxable income too; and for the stock market, who knows about that.

Regarding foreclosures, they aren’t always cracked up to be what some people make them out to be. There are pitfalls to be concerned about.

Lastly, you might want to read this article in the AJC (http://www.ajc.com:80/opinion/content/printedition/2008/04/14/housinged0414.html - broken link) about the housing prospects in Atlanta. According to the article, there are clearer skies ahead for the Atlanta real estate market.