Mistakes home buyers make? (Phoenix: real estate, rental, HOA)

[rbe2008]

Wondering what types of mistakes you've seen homebuyers in the Phoenix area make?

[Mouser]

(1) Becoming emotionally involved and not staying to a
game plan that should have been planned in advance.

[Howard Roark]

Not sure about Phoenix in particular, but in general, which includes Phoenix:
1. Relying on two incomes to make the 2 and a half times your income figure for your PITI.
2. Not allowing for the cost of maintenance (should be PITIM).
3. Assuming your job and income will last as long as your mortgage payments.
4. Buying an adjustable rate mortgage or an interest only mortgage. If you have to stretch very far, you should be renting instead.
5. Thinking that real estate only goes up. It does not.
6. Refusing to do a simple, quick, free internet search about buying a house in general and excluding NAR, which has a vested interest in getting anyone into a house. One would have encountered the problems people had in previous bubbles.
7. Not researching the neighborhood where you are about to purchase a house. Did you meet the neighbors? Does the kid across the street play the drums at 10pm?
8. Buying when the cost of the same amenities in a rental is far cheaper than PITIM, including the mortgage interest deduction.

These cover about 80% of the buyers of houses in Phoenix between the years 2003 and 2007.

[rbe2008]

Excellent information.

Regarding meeting the neighbors, it would be just my luck to talk to the seller's best friend next door who would say anything to help sell the house

[Potential_Landlord]

Originally Posted by Howard Roark

Not sure about Phoenix in particular, but in general, which includes Phoenix:
...
2. Not allowing for the cost of maintenance (should be PITIM).
...
These cover about 80% of the buyers of houses in Phoenix between the years 2003 and 2007.

Howard,

How much do I need to calculate for maintenance? Is there a formula based on price, age, size etc.?

Thanks, PL

[MotleyCrew]

We pay a yard man only $45 a month to trim and blow. We also have a condo that we rent out and the water bill is around $60 a month, $160 including the HOA fee. If you want a pest service, and I would not go without one here, they run about $45 a month. Some are higher and some are less.

[SVTLightning]

Originally Posted by rbe2008

Regarding meeting the neighbors, it would be just my luck to talk to the seller's best friend next door who would say anything to help sell the house

Not really, because you will then become the new neighbor they have to deal with when the seller is gone. When we bought our house last month, we drove to the house at 7pm to check out the neighborhood when people were home, one of the neighbors actually came up and talked to us about 30 minutes. If he had not talked to us and answered some questions we probably would have looked elsewhere. (he gave us the idea for a privacy fence along the road)

[Master Shake]

Originally Posted by rbe2008

Excellent information.

Regarding meeting the neighbors, it would be just my luck to talk to the seller's best friend next door who would say anything to help sell the house

Or the other way around... Where the neighbor hates the seller and will say anything to help get the seller out of the neighborhood!

[dbean]

Originally Posted by rbe2008

Wondering what types of mistakes you've seen homebuyers in the Phoenix area make?

We were also FIRST TIME homebuyers:

#1 mistake hands down was NOT following the inspector around our property. Our relator was buddy buddy with him and only advised us to attend the last 15min of the inspection. So, that's what I did, got there just in time for him to print out the report and have me sign it.

About 1.5 months later, we took ownership of the house and went to kick on the AC. Got nothing...had warranty company out to look at AC and they found mouse damage, chewed wires and smoke was pouring out of the unit! Best part was that AC tech. ALSO found the thermostat NOT working!! They had to remove the thermostat from the wall and manually connect wires before the outdoor unit would even turn on!!!!

They wanted close to $1000 to fix everything, so, we opted to get the whole thing put in new, including air handler. The warranty company said they WILL NOT cover anything since the damage wasn't "natural wear-and-tear" and was rather "an act of god", aka pest dammage!!!!!!!! Absolutely UNREAL!!

The new install was of course, out of our pocket, $6000.

All in all, follow the inspector around, take off electrical panels, (yeah yeah yeah, I know inspectors aren't "required to do so" but it never hurts to look yourself), ask questions, and MAKE SURE he/she earns the $300-$400 you pay them.

Oh yeah, don't let your guard down. Don't let your slicked back hair style - realtor play buddy buddy with you. Be skeptical and question everything.

Realtors are desperate for business right now and will say/do whatever they can to make the sale; that's the bottom line.

[YAZ]

dbean,

The same thing happened to us. Fortunately, 1500k back next year from fed taxes cuz the new ac has a 16 SEER rating. 12 month same as cash financing...

Water heater took a dump the second week we were here, sewer backed up the first night. It was coming from underneath the toilets, bathtub drains and sinks.

To add insult to injury, I got laid off a month ago.

Things are getting very INTERESTING around here.

Our tenant just got laid off too. His ac went out the other day. 400 bucks to fix it, plus he's behind 200 bucks in rent.

I feel good though.

Lots of water and salads 'round here lately.