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Buying real estate is a big proposition and you need to learn as much as possible on your own. The truth is real estate professionals are sales people, not financial managers. That being said, the only time I ever blamed anyone for a real estate loss was my shark realtor quite a few years ago. It didnt matter because I signed on the dotted line. A hard lesson learned.
I was inexperienced and at the time my home state had just implemented the Homestead tax a few years before. It was kind of new and not a lot of information on it. What no one told us was that if you buy a home that someone had lived in for many years, the taxes would almost double (depending how long the house had been occupied etc) for the new owners. We bought an estate sale and the previous owner had lived in the house for over 30 years. So we went in thinking the property taxes were going to be X amount and a year later we got a very nasty surprise when the taxes were recalculated. We had questioned the realtor on the taxes several times because they seemed low and she did not tell us the truth. I think she knew if she had, we would have passed on the house. Our fault as we should have looked deeper into it. At that time it was just kind of screwy because we had looked at other homes and the tax amount was spot on. We ended up struggling pretty hard and had to sell the house about 4 years later. It simply was too much for us tax wise. It was not a good experience at all. My friends were then starting to buy their first homes. I warned them about the Homestead tax stuff. They would question their realtors and the realtors would then come clean so to speak on the issue. For quite a while realtors were not being upfront about this info. Now they are and I think with the housing mess, people are not getting conned and duped like they did in the past. So that is a good thing. Banks simply will not grant you a loan if your income doesn't jive.
Interestingly enough, where we live now in a different state, they passed the Homestead Tax stuff the year we started looking. So with our past experience we knew how it worked.
By the way, this thread is old! lol. It was started in 2007. Who dug this one up?
I was inexperienced and at the time my home state had just implemented the Homestead tax a few years before. It was kind of new and not a lot of information on it. What no one told us was that if you buy a home that someone had lived in for many years, the taxes would almost double (depending how long the house had been occupied etc) for the new owners. We bought an estate sale and the previous owner had lived in the house for over 30 years. So we went in thinking the property taxes were going to be X amount and a year later we got a very nasty surprise when the taxes were recalculated. We had questioned the realtor on the taxes several times because they seemed low and she did not tell us the truth. I think she knew if she had, we would have passed on the house. Our fault as we should have looked deeper into it. At that time it was just kind of screwy because we had looked at other homes and the tax amount was spot on. We ended up struggling pretty hard and had to sell the house about 4 years later. It simply was too much for us tax wise. It was not a good experience at all. My friends were then starting to buy their first homes. I warned them about the Homestead tax stuff. They would question their realtors and the realtors would then come clean so to speak on the issue. For quite a while realtors were not being upfront about this info. Now they are and I think with the housing mess, people are not getting conned and duped like they did in the past. So that is a good thing. Banks simply will not grant you a loan if your income doesn't jive.
Do you mean Homestead exemption? I think it's an awesome law because it provides homeowners with so many protections from creditors, surviving spouses, etc. In some states, homestead examption is automaticaly transferred at the time of purchase. In other states, like mine, the new property owner needs to fill out a claim form to receive homestead protection. If the claim form isn't filed, the property taxes will increase significantly higher. For example, say an exemption is applied to the first 50k of the house assessment value, the property taxes would increase based on including that 50k into the tax calculation if the new property owner didn't file for homestead exemption. Once the homestead exemption claim is filed, the property tax will go down.
Where you do not receive the same exemption benefit is if you purchase the home from senior citizens if the state provides higher exemptions to senior citizens, but it wouldnt' matter if the senior citizens owned the house for 1 year or 30 years because their age is often what provides them with the higher protection, not the lenght of time at the property with the exception of a few areas where the owner needs to live in the house for 10 years. I've never heard of a 30 year requirement though.
It does sound like you were conned by the realtor though for not fully disclosing information. It's sad that people have to learn the hard way. Darn shame you couldn't go after the realtor for damages because people shouldn't have to learn the hard way about these things. So, you're absolutely right that homebuyers need to do their homework.
My advice to a new homebuyer is to calculate their potential taxes according to their purchase price instead of going with the current taxes of the home because property assessments are often adjusted after the sale of a home and the new purchase price is often taken into consideration, even in regions that don't have homestead exemption.
Do you mean Homestead exemption? I think it's an awesome law because it provides homeowners with so many protections from creditors, surviving spouses, etc. In some states, homestead examption is automaticaly transferred at the time of purchase. In other states, like mine, the new property owner needs to fill out a claim form to receive homestead protection. If the claim form isn't filed, the property taxes will increase significantly higher. For example, say an exemption is applied to the first 50k of the house assessment value, the property taxes would increase based on including that 50k into the tax calculation if the new property owner didn't file for homestead exemption. Once the homestead exemption claim is filed, the property tax will go down.
Where you do not receive the same exemption benefit is if you purchase the home from senior citizens if the state provides higher exemptions to senior citizens, but it wouldnt' matter if the senior citizens owned the house for 1 year or 30 years because their age is often what provides them with the higher protection, not the lenght of time at the property with the exception of a few areas where the owner needs to live in the house for 10 years. I've never heard of a 30 year requirement though.
It does sound like you were conned by the realtor though for not fully disclosing information. It's sad that people have to learn the hard way. Darn shame you couldn't go after the realtor for damages because people shouldn't have to learn the hard way about these things. So, you're absolutely right that homebuyers need to do their homework.
My advice to a new homebuyer is to calculate their potential taxes according to their purchase price instead of going with the current taxes of the home because property assessments are often adjusted after the sale of a home and the new purchase price is often taken into consideration, even in regions that don't have homestead exemption.
Yes and no. Not sure about the protection of creditors but it is a tax exemption. You see we had been in our first house for a couple of years when it passed. So it was exciting when it passed because our taxes at the time were around 2500 a year and the exemption dropped it to around 1200 (this was back in 94). Then we sold that house and bought the one (in 2001) we had trouble with. What complicated it all was that property is reassessed but the longer you are in the house, the less the taxes go up each year. There probably was some Senior citizen discounts as well. So the house we looked at had taxes of around 1400 a year. Now this seemed cheap to us because we moved to a nicer city with higher taxes and at 1400, that wasn't that big of a jump from what we were paying. So I questioned it. Now the other properties we had looked at the owners had only been in the homes for about 5 or 6 yrs so the taxes were pretty spot on. Mainly because those properties had changed hands on a consistent basis. So the taxes went up in little spurts that were absorbed by the home being sold often (Now this knowledge comes from after the fact). When someone stays in the home a long time, then that is when the new owners get spanked. We filed the exemption in a timely fashion, so that wasn't the issue. The issue was the property was reassessed at the higher rate. So within a year our taxes went from 1400 to 3500 a year. As you can imagine, that was a pretty big bang to our pocket book. We were pretty friendly with the neighbors and asked them what they paid. Most of them were around 2000-2800 or so. When they finally sell their homes, then those new owners would be around the rate we were. So as you can see it was pretty complicated.
When my grandmother passed away in 2004, a family member wanted to buy the house. He was warned about the taxes. So he was prepared but was still a bit shocked when he got his new tax rate the following year. His taxes double as well. It is just how it went in my home state. I don't know how other states do the Homestead. How the state handled the homestead actually turned into a big deal because experts believed it contributed to the housing mess in my home state. The reason being because of so much dishonesty about it. Many first time homebuyers got themselves in trouble over the taxes more than buying a home they couldn't afford price wise. But since they couldnt afford the house they were lumped into the group that over spent but when it was broken down, people that really understood the issue realized it was just more than bad loans. Estate sales were hard to get rid of once people caught on about the tax problem. Realtors stopped advertising homes as estate sales because it was a red flag for the big spank on taxes. Now I don't think its so much of an issue because my home state is one of the first that felt the housing bust. The homes are so cheap now my husband and I joke about moving back and buying a house cash and working at McDonalds (especially after a really bad day at work)
To top it off, we had a corrupt mortgage guy. That is another whole story. He was investigated because of his practices. He went to rehab and that was the last I heard about him (he was a raging drunk). So anyway....it was the worst real estate deal we ever did. Everyone dropped the ball or was corrupt. A complete painful and expensive nightmare. I really learned a lot from that experience. Sure I was mad but I think overall I was more pissed at myself. Buying real estate is emotional and you really need to keep your head because in the end, you are the one stuck with it.
American housing bubble (that have popped & is still affecting us)
VS
Canadian "housing bubble?" (coming soon to the theater near you....???)
"In 2005, the average American owed $1.30 in debt for every dollar of income. Home equity was eroding as Americans pulled more than $900 billion out of their homes to buy cars, granite countertops and put their kids through college.......... ......................
...............By the third quarter of 2011, Canadians owed an average of $1.53 for every dollar they brought in, up 40 per cent in the past 10 years and just below where the U.S. was before its housing crash."
Another one... better yet... same article....
" The couple say they expect prices to crash, but that doesn’t matter much since they plan to be in their home for at least 10 years."
^^^Note the date... 2005 VS 2011
Yah... stay for 10 years (what about if they cannot $pay$???? for that 10 years...)???? What will they survive on??? Even the air wall street is trying to tax through so called "green living" of emissions tests & such (which everyone have to pay for now)???
So who else does that Canadian "couple" reminds us of (that US couple?)???
Its "America", all over again.
(Question returns as it comes a full circle again of human loves making that same mistake over & over again (like a bunny running in its circle till it gets "predictably caught / shot")... ***"did we learn from "our" mistakes?????")
At least one thing they don't have of "yet" = the way over priced "college bubble".
P.S. Buddha preached... to reach "Nirvana" is to break out of that cycle of the Karma (think on it like the "vicious circle" of debt)... something to think about when buying.
There is a major disparity between houses in different parts of the country. Here's an ol' boy that thought he'd improve this house only to find that he has improved it far beyond the neighborhoods prices. Fabulous home actually and he's done a great job. He had ZERO takers at $125,000. It's a 4 bedroom, 2 bath, 2 car garage, with just under 2300 sq ft. It has 2 fireplaces, 2 kitchens, 2 eating areas, and an office in the back. Nice home. So what would this home sell for in your area? This home is not huge for this neighborhood as there are others much larger- to 3200 sq ft but not near as nice. This home was built back in 1978.
Given the ugly bars on the windows and the fence at the door, I take it this is in a terrible neighborhood. Assuming a terrible neighborhood and bad schools I would guess this home in Michigan (Detroit Metro) would sell for about $20,000 - $30,000. In Orange County California I would guess around $300,000 to $350,000.
From a personal standpoint I woudl nto buy this house. There is a lot of it that I woudl re-do (starting with removing the bars on the windows and the fence in front of the door - if the area is so ridiculously dangerous that they are necessary, I simply would nto consider living there period.
Not in a bad area for crime, actually it would probably rank in one of the lowest crime areas in San Antonio Texas. Schools are some of the best in Texas and the local high school is new. The elementary ranks as exemplary as does the middle school. High school ranks as acceptable by the Texas Education Agency. The subdivision has a playground, track, picnic tables, pond with fish, ducks, the usual stuff and is well kept. Streets have been retopped in the last 2 years. There is a public swimming pool about half mile from the house that is also new.
Not in a bad area for crime, actually it would probably rank in one of the lowest crime areas in San Antonio Texas. Schools are some of the best in Texas and the local high school is new. The elementary ranks as exemplary as does the middle school. High school ranks as acceptable by the Texas Education Agency. The subdivision has a playground, track, picnic tables, pond with fish, ducks, the usual stuff and is well kept. Streets have been retopped in the last 2 years. There is a public swimming pool about half mile from the house that is also new.
It really depends on what neighborhood it would be in, in my area. if it were in my town, which has an excellent school district, but not the top five on Long island, I'd figure around $400-550K. depending on actual condition vs pictures, it could go a little lower. Put it in the top school district in my area maybe closer to 700K.
if you priced that at $350K in my town, you'd have a line of people beating down your door.
as to condition, I don't find it all that nice. 2 kitchens most of the time is a detractor, why do you need 2 kitchens? its wasting space. the kitchen I saw in the pic looks older, looks like he painted older wood cabinets. again, they're not in "need" of replacement, but not fully updated.
not sure what taxes would be on that by you, in my area probably $10,000.
havent read the whole thread...
but i cant help but wonder....
WHY is it the realtors fault if people look at and try to buy a property beyond their means.
as a buyer it is MY responsibility to find out what the bank is willing to give me vs what i personaly fel comfortable afforing and the making it clear to the realtor that im not willing to go outside of my comfort price range and stick to my guns.
when i was looking at houses we saw alot, some in my budget some not...the only ones she showed me outside my budget were ones she that had been sat for a while and she was certain we could probably bring them into my price range..but in the end it was MY job as the buyer to say "nope, too expensive" and the banks job as the lender to say "you CANNOT afford more than $x amount!"
Not in a bad area for crime, actually it would probably rank in one of the lowest crime areas in San Antonio Texas. Schools are some of the best in Texas and the local high school is new. The elementary ranks as exemplary as does the middle school. High school ranks as acceptable by the Texas Education Agency. The subdivision has a playground, track, picnic tables, pond with fish, ducks, the usual stuff and is well kept. Streets have been retopped in the last 2 years. There is a public swimming pool about half mile from the house that is also new.
Then why the bars on the windows?!! They were the first thing I noticed. I would never want to live in a neighborhood where bars on windows are the norm.
The bars are there for decoration. Typically, Mexican architecture will have the decorative irons bars on the doors, windows, and usually a fence made from stucco with the same iron at the top. There's a ton of it down here. If you'll notice, the bars don't cover the entire window.
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