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Still at the price it is being offered your could easily make twice that back. Now I just have to decide if it is worth the effort. Jay
If this is your ultimate motivation for the property (making money back), I'd strongly caution you not to do anything without a RE professional and/or attorney representing you.
No I would not necessarily be looking to make money back but it is nice to know that buying this and making the improvements needed would be worth it if sold. I have an attorney who I would bring into this and am now thinking about having my friends mother show me the place. I also have a good contractor that I trust and would have him and a professional inspector inspect the place. My goal would be to update the house so that I do not have any issues with it for the next 10 years. I think that would mean paint, trim repairs, replace mechanicals and appliances, as well as cosmetics. I am thinking that $75,000 would cover this. Any thoughts? Jay
Uconn97 - Yeap, it is the same house. I had an appointment to see on Labor Day but the agent backed out and I haven't rescheduled. I did get inside one day when there were some workers there and like you said it does need work. I originally thought it needed about $50,000 but after seeing it I am now thinking it needs $75,000 to $80,000. In addition to paint EVERYWHERE (never saw a garage that needed painting inside), it needs new carpets, new countertops (how did they shatter Corian?), complete new master bath, family room ceiling repair, landscaping, new tile in mudrom, new appliances, new furnace, AC and hot water heater, possible roof repairs and exterior trim repairs. I am surprised that a home that nice and only 17 years old is in such tough shape.
The cabinets and woodwork in the home are stunning and the architectural design is charming. The third floor is not finished, just a walkup attic but with some electrical outlets, sheetrock and carpet you can easily have a large bonus room.
Also, I am surprised to hear there were HOA fees there since the streets are all town owned and maintained. What are the fees for and how much are they?
All in all, the house is beautiful and with this work it could be stunning. It is big for us too (we now have 2,300 s.f.) but I guess I could get use to the room. Even with the work needed and the high taxes it would be in our price range but my wife and kids think it is too far out (I don't) and it is a lot more home than we need. Still with an investment of $530,000 you can get a home worth well over $600,000. Not bad if you are willing to make an effort. I am still trying to decide but I am not sure I would have time to do this. Jay
Jay - small world!! I sent you two message DM with some info...
Yes, the house was nice, but it was way worn out. Given all the costs of upkeep and renovations we did decide to pass. I'm no expert, but I also thought that the furnace, AC and hot water heater were original and would need replacement. If you decide to move forward, consider hiring a few experts to come in and look at these systems to make sure you know what you are getting into.
Not sure about the fees, but one of the DM's I sent you has the link to the association page. Not sure how uptight they are, but unless its changed, back when the neighborhood was built, exterior colors and landscaping all had to be approved by the HOA - so something to think about.
It's roughly 8 miles to the center of town, so not too far really, but I guess thats subjective.
Also, a home across the street just recently sold - it was on the market for several years and started at $999K - it sold for about $730 or $740K. Not sure I would bank on those homes holding their value although I agree that $450K is a bargain today for that neighborhood.
Just a little food for thought. Not sure if CT is a homestead property tax state but my old state of MI was and now our new state of IN is. The homestead "break" is kind of a hassle and if you are unsure of how it works, it can be the difference of being able to afford your home or not. That determination usually comes a few years after you buy the place. Be savvy and find out if you can figure out what the taxes will be a few years from now especially if you are already slightly pressing your budget. When MI passed the homestead most were happy if they already owned a home. It meant the taxes would drop on your home and would only increase at a very low percentage. Great if you plan on dying in the house. The problem came in when you buy another home. When we bought our second home, we were told what the taxes would be. Very affordable and we were happy. A year later we were shocked when our property taxes doubled! The property is reaccessed for a much higher value. In our case we went from a payment of 859 per month to 1400 per month 5 yrs later. We became house poor and simply had to sell the place. It also didnt help that the estate sale we bought needed a lot of work and each time a permit was pulled it seemed like our taxes jumped. I personally think this was one of the big issues that MI residents faced that ended up leaving one not being able to afford their house, add job loss on top of that and well...big problems. Realtors are now informing buyers of this issue. They pretty much warn new buyers not to put too much faith into what the taxes are currently. The State of MI now has a calculator on their website for figuring out what the new taxes will be later on.
We now live in IN and they passed the homestead a year before we bought our house. We knew our taxes would go up some but not double. The longer the sellers are in the home makes a big difference on how much taxes will increase. We have been in the house a little over a year now and our taxes did increase by 200 per year. Not a huge deal but what kind of shocked us was the big jump in our homeowners insurance. I am suspecting the company we chose gave us a teaser rate to get our business. When our policy was renewed earlier this year, the policy was considerably higher which I found annoying since we had not made a claim. We ended up switching insurance companies but could not get anything close to that teaser rate. So in the year and half we have been here, our house payment went up almost 200 per month. It is still affordable for us but it did make us rethink certain items in our budget such as a new car purchase. So anyway, I am just throwing this out there. Keep us posted on what you decide.
Connecticut is not a "Homestead" tax state and I hope it never is. This sounds like a politcian's majic trick to get people to think that they are reducing taxes when they are not. They are just shifting the burden. This allows them to hide what thye are spending and actually would discourage investment. Taxes should be simple and uniform and should not give you any surprises. Jay
Connecticut is not a "Homestead" tax state and I hope it never is. This sounds like a politcian's majic trick to get people to think that they are reducing taxes when they are not. They are just shifting the burden. This allows them to hide what thye are spending and actually would discourage investment. Taxes should be simple and uniform and should not give you any surprises. Jay
Bingo! That is exactly how I feel about it too, a magic trick. I am glad you got what I was getting at. A lot people dont understand. I know when my husband and I started struggling back in 2001, we explained the tax issue to family and we got blank stares and snickers that we were probably just in heavy cc debt. IMO, I think this was a factor in the housing crisis in MI at the beginning. New buyers, surprise tax increases, add a sub prime mortgage to the mix and then job loss.
Hubby and I liked to buy estate sales. Homes that werent pretty with updates but were solid. Older generations kept up the important stuff. But with the homestead these homes were a crap shoot on affordability in the future. After people started getting savvy, I know some realtors did not want to list a house as an estate sale because the savvy buyer didnt want to get into the whole "gee, what will my taxes be in 5 yrs" game. Anyway, not to hijack the thread, I just wanted to throw that out there as food for thought. I will be curious on what you decide on this house. Also, we looked at several repos in upscale areas that were listed cheap. We bid on a couple, the banks listed low to perk interest to cause bidding wars. We bid on several houses and gave the bank asking price (because it was a good deal). They came back to us and said to submit our best offer. We came back and said that was it. We stopped looking at repos after that.
I think I have pretty much decided to pass on the house, for now at least. There is so much work needed. I originally thought $50,000 would be enough but then upped it to $75,000 when I saw the inside. After going back again, I am now thinking more like $100,000 is needed to get it in good shape. It looks like a lot of the windows (and there are a lot of them) need sill replacements. Also the large french doors in the family room are all rotted and will probably need replacement as well. Add to that a new master bath (cracked tiles, broken whirlpool, outdated vanity, filthy shower), new kitchen appliances and countertops, new carpeting throughout, exterior trim replacement, a COMPLETE paint job in and out, a lot of landscaping and new carpets in the bedrooms and new mudrom flooring means a lot of expense. I also noticed that a few homes in the neighborhood now on the maket in the low $600's rather than the upper $600's and $700's that I thought was throughout the neighborhood. And I found out from UConn97 that there is an HOA which I would hate dealing with. I am going to step back for now and watch the house and see if there is anyone ready to take it on. If not, I may reconsider in a couple of months. We will see. Jay
JayCT - I think you are making the right decision. I think the house will sell sooner, rather than later, simply because someone "blind" will walk in and be wowed by the space and upscale feel of the area and make a fools move not really considering what the costs will be to fix up and maintain a house like that. Time will tell. I see the price on some of those home dropping - many have not been maintained and frankly are outdated given the price point. The few I have seen move quickly are the ones that were upgraded a little since they were built. Not sure if you really looked at the neighborhood, but if you do it with a scrutinizing eye, you'll notice that many homes are in desperate need of paint and many have landscaping that I personally would consider overgrown and not well kept.
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A year later we were shocked when our property taxes doubled! 
The property is reaccessed for a much higher value. In our case we went from a payment of 859 per month to 1400 per month 5 yrs later. We became house poor and simply had to sell the place. 
It also didnt help that the estate sale we bought needed a lot of work and each time a permit was pulled it seemed like our taxes jumped. I personally think this was one of the big issues that MI residents faced that ended up leaving one not being able to afford their house, add job loss on top of that and well...big problems. Realtors are now informing buyers of this issue. They pretty much warn new buyers not to put too much faith into what the taxes are currently. The State of MI now has a calculator on their website for figuring out what the new taxes will be later on. 
IMO, I think this was a factor in the housing crisis in MI at the beginning. New buyers, surprise tax increases, add a sub prime mortgage to the mix and then job loss. 
We stopped looking at repos after that.
