Help for First Time Home Buyers (Melville, Bath: sale, appliances, closing)

[modmondays]

Originally Posted by totallyfrazzled

We're looking in Suffolk, which has no website like mynassauproperty.com; the only Township that has ANYTHING official on the web is Smithtown, and that's only the basic property tax info from the assessor's office (current owner's name, true taxes, any STAR exemptions current, and date of current owner's initial assessment). So for the ACCURATE property tax situation on any home in Suffolk, the only way to be 100% sure of the info is to get it from the town's Assessor. Also, no website is going to give you the CO information on a house; does the seller truly have a CO for that deck? the pool? the shed? ALL the alterations to the house that increased the original square footage? The only way to find out for sure (and to verify that the current taxes truly do reflect what is physically there) is to get that info from the Town. You'd be amazed at how some realtors simply take the seller's word that they have a CO for this, that, and the other thing; we've seen several houses where there turned out to be an open permit (CO never actually gotten, thus taxes don't reflect that item) which the seller called a CO. And MANY cases in which the seller had not only gotten their initial mortgage but refinanced the house as well, and in both cases they'd bought the house without proper COs and nobody caught it (supposedly) until we went to the Town ourselves to verify that everything we saw at the house was legit. Oh, and the number of illegal apartments in basements (especially second kitchens, advertised in listings as 'summer kitchen' but the Town of course has no record of a second kitchen or third bath AT ALL) is truly staggering. Amazing how the apartment always belongs to a family member. We always then ask 'So this is a legal mother/daughter? Will you be removing the second kitchen before closing? because it won't be a mother/daughter once you sell the house, of course' and watch the stammering and evasion begin.

Thanks.

One "trick" I use (which I am sure you have already too) is to look at the Pre-1985 Property Cards on Prop Shark. On close inspection, many times it is quite easy to tell if the property has been added-on to over the past 15-20 years. So, if the current owner has been living there since say 1986, and the house appears different, good chance that they did the current additions that you now see.....

[modmondays]

Originally Posted by TomMoser

No, what I am talking about is making an offer that is way out of line with the comps. That, to me, is the same as a seller asking way more then is supported by the comps.

I always advise my buyer clients to make reasonable offers on homes that are already priced realistically. Even though a home may be way overpriced, it is doubtful that the seller will accept an offer that is dramatically below their asking price. It's much better to deal with people who are grounded in reality.

Real problem in the Nassau market though is that sellers are pricing too high (still wanting bubble returns) and buyers cant find enough of those that you say "price realistically"......

That is why there is alot of animosity right now between buyers/sellers and REA's -- as well as exploding inventory and gridlock

[TomMoser]

Originally Posted by modmondays

One other thing:

Sometimes, pulling comps that tell a real-market story is very difficult as you know.

Thus: what would you think of a buyer that -- in lieu of a good comp story -- used the "Fair Market Value" price that the County Assessor has used? "Fair Market Value" price in County Assessor parlance is generally defined as "the price a buyer would willingly pay for the property in a free/open market with no pressure applied to anyone/anywhere within the transaction - - and within today's market climate"

??? thoughts?

I find that often the FMV used by the Assessor is way off. They do a driveby of the property only, so they have no idea about the interior condition. Also, it is usually not very up to date. I generally ignore it. One thing that I will do, sometimes, is look at the comps that they cite and examine them to see if they might make sense.

[TomMoser]

Originally Posted by modmondays

Real problem in the Nassau market though is that sellers are pricing too high (still wanting bubble returns) and buyers cant find enough of those that you say "price realistically"......

That is why there is alot of animosity right now between buyers/sellers and REA's -- as well as exploding inventory and gridlock

True. It is a difficult market to navigate through today. Many sellers and buyers are being unreasonable in their expectations. Many agents fan these unreasonable expectations because they tell people what they want to hear instead of what they need to hear.

[modmondays]

Originally Posted by TomMoser

I find that often the FMV used by the Assessor is way off. They do a driveby of the property only, so they have no idea about the interior condition. Also, it is usually not very up to date. I generally ignore it. One thing that I will do, sometimes, is look at the comps that they cite and examine them to see if they might make sense.

ok... but what if it is a "known-known" (known by buyer/seller and REA) that the interior stinks?

You really cant go by Appraisals either as a buyer. Because LOTS of Home Appraisers are now being indicted (along with mortgage brokers, banks, real estate offices etc) for OVER appraising for the last 6 years - - so how can you possibly go by the Appraisal either????? Especially since Laffey and some other RE entities on LI were directly involved with this "scam" as well????

As a buyer, I am going to go in and make my offer based on the most advantageous (to me of course) - - yet factual - - story I can tell. Thus, my offers will be either based on comps, assessments or appraisals (and of course, my budget ceiling)

[TomMoser]

This situation is compounded by the fact that there have been few recent sales in some neighborhoods, thus making recent comps hard to come by. This is going to remain a challenge until the market finds it's footing again.

[totallyfrazzled]

Originally Posted by TomMoser

On the Town of Huntington's web site you can get property tax info as well as a CO and permit history.

Oops, sorry, then I stand corrected. We've never had any interest whatsoever in any section within the Town of Huntington, so never looked into their resources. We've looked in every other western/central Suffolk township though: Smithtown, Islip, Brookhaven, and Riverhead.

[modmondays]

Originally Posted by TomMoser

This situation is compounded by the fact that there have been few recent sales in some neighborhoods, thus making recent comps hard to come by. This is going to remain a challenge until the market finds it's footing again.

Tom (and anyone else):

In your opinion, if a house is extremely tired (25+ year old bathrooms, kitchens, appliances etc) should or shouldnt a buyer be factoring in the replacement/renovation of those conditions into their offer price?

I cant tell you how many of these conditions we see on Nassau North Shore. The reason is many Sr. Citizens who have been living there are now finally ready to move on (to wherever) and quite honestly many have not improved their homes since their fixed-incomes kicked in (not surprising at all.) Some also passed away while still living in the area and we see a fair amount of estate sales with these as well.

Additionally, the NYC business boom of the past 10 years saw many relocated familes from out-of-town moving here since it is a very "commutable" area to the city -- and likely "assuming" that one day they would relocate back to where they came from. Hence, we have also seen some homes where well-heeled couples lived, recently relocated again somewhere else, and thus never did a thing to the home in ten + years.

Thus, the "Value-Priced" homes in the nice areas here are currently listed at $799-$999 (lol) and generally "fixer-uppers". If you crunch the comps, historical valuations and the appraisals/assessments, you will also see that these lists are not realistically priced either!

So, for any buyer, some of these homes with nice "bones" will take another $100k+ to restore to something livable - - and that doesnt include fixes to the architectural envelope of the home either (roof, landscape, insulation, plumb/electrical, flooring)

What are your thoughts? This is really what alot of offers are based on over here and something everyone is struggling with - - - "Fair Market Value" - - or "Unreasonable Low-Ball"

[totallyfrazzled]

Originally Posted by modmondays

T
So, for any buyer, some of these homes with nice "bones" will take another $100k+ to restore to something livable - - and that doesnt include fixes to the architectural envelope of the home either (roof, landscape, insulation, plumb/electrical, flooring)

AHA! You've just hit on the magic bone-of-contention word: "liveable".

That's exactly our position as well. The problem is the two sides' definition of that word.

On the selling side, it seems like "liveable" = "the roof doesn't leak, the plumbing, heating and electrical are functional, there are no gaping holes in any walls or flooring, the exterior siding isn't falling off in pieces, and any REASONABLE person would be quite happy with this house after they paint the interior (and/or exterior) and replace the carpets/refinish the floors."

On the buying side, "livable" means NOT having to feel as though you're buying an Edsel that gets 3 miles to the gallon and has the springs popping through the seats, and will have to spend big bucks to update it into a 3-year-old Saturn; the problem being that the Edsel is being sold at the Saturn's price with a sign on the windshield saying "Just needs a wash and wax!"

[modmondays]

Originally Posted by totallyfrazzled

AHA! You've just hit on the magic bone-of-contention word: "liveable".

That's exactly our position as well. The problem is the two sides' definition of that word.

On the selling side, it seems like "liveable" = "the roof doesn't leak, the plumbing, heating and electrical are functional, there are no gaping holes in any walls or flooring, the exterior siding isn't falling off in pieces, and any REASONABLE person would be quite happy with this house after they paint the interior (and/or exterior) and replace the carpets/refinish the floors."

On the buying side, "livable" means NOT having to feel as though you're buying an Edsel that gets 3 miles to the gallon and has the springs popping through the seats, and will have to spend big bucks to update it into a 3-year-old Saturn; the problem being that the Edsel is being sold at the Saturn's price with a sign on the windshield saying "Just needs a wash and wax!"

You NAILED it....congrats. So, are you "deducting" the fixes required (1-2 years out) from your initial offers - -or arent you? And if so, do you think this is putting you into the "unreasonable low-ball" offer category?