how much do you offer on an already dirt cheap house

[scorp200]

Thanks guys and Askmisterbrown, that's the situation that was going on in St. Pete, FL! Crazy times...anyway I drove by and it has siding (a big negative for me on a 1920 house) AND I decided as cheap as it is, I really need to clear up my finances first. That's because the house was missing its AC unit, and needed a door replaced, and that was just outside. I GUESS there will be another....(it is SO cute though...)

(just desperate not to be a renter when I turn 40, but I have to live with it...)

[IdaClaire]

askmisterbrown, awesome deal!

scorp200, I don't know as much about east Durham, but I know that older homes in an affordable price range can go quickly.

In our old neighborhood, Old West Durham, houses rarely ever reach the open market, and when they do, they disappear at lightening speed. We're talking old mill houses, about 1250 square feet, and only a few blocks from 9th St. We worked with a realtor, put our home on the market on a Friday, and the realtor called Saturday morning with several offers, and most were over the asking price. We took the highest offer and canceled our open house planned for Sunday.

Now, I'm not sure that east Durham moves as quickly, but it wouldn't hurt to dig around to find out how quickly real estate moves in this neighborhood. I definitely agree with those who suggest having comps run. I'd also go with an inspector who specializes in older homes. Someone who looks at homes from the nineties and up all day long doesn't necessarily have a lot of experience with what you need to look for in older homes.

I am not one who would tell you not to buy in East Durham. I am somewhat adventurous myself, and if I were young and single (and male), I'd probably take some chances I wouldn't take now with a young child. However, it wouldn't hurt to do a quick look at the crime sheets for your area and to check it out late at night. But hey- Durham is coming along, and those who snatched up cheap homes in "sketchy" areas in Durham like Old North Durham 10-15 years ago are reaping the benefits of being a pioneer of sorts.

[Bezzled]

Im in St.Pete waiting to sell my condo.

I am waiting to move to Raleigh.

[North_Raleigh_Guy]

Originally Posted by askmisterbrown

If the house truly is “dirt cheap,” i.e. underpriced, and it’s in a “rapidly up-and-coming neighborhood” then you had better make a full price offer quick, because others have been waiting for this deal. Especially if it’s your “dream home.”

I’ve got to tell a story here. I keep a close eye on real estate in my area. I tend to have my eye on a few houses. One late afternoon a couple years ago, a beauty showed up on the MLS at a great price. I called a realtor. He couldn’t talk, was with a client. I called another realtor, left a message. Called another, left a message. I jumped on my bike and hauled a** to this house. There was no sign in the yard. I knocked on the door. The tenant didn’t even know it was for sale. He let me inside to look around. Everything was original! After five minutes, with a quick look in the attic and basement, I thanked him and hauled a** back home. One realtor had left a message. I called him and we met at 8 the next morning. He told me to make a lowball offer. I said, “Full-price-cash-offer-close-in-two-weeks!” He said OK and we sent the offer. I called my bank and got some money in my account from a line of credit. The seller accepted the offer. That evening at 6 my realtor and I officially went to the house and met the seller’s realtor. She said, “I don’t know what it is about this house. After we accepted your offer, we turned down seven other offers!” At closing, she told me they had turned down 21 offers before they could get the house off the MLS!

Why was it such a great deal? The owner had inherited a bunch of houses from his father, and put some of them on the market to pay off some debt. He had never even set foot in this house! His realtor was very young, was from another part of town and didn’t know what was going on in this neighborhood.

I sold the house to my brother and he is living in a great house mortgage-free!

The moral of the story is: If you know what the market is and the house is a great deal and it’s your dream home, JUMP NOW. Others will jump and you have to jump faster than they.

Now, I have to add, that knowing it is a good deal has to be based on your knowledge of several things:
1. Construction and condition: Is the roof good? Can you see that there are no leaks? Can you see under the floors to see that there is no rot or termite damage? Is the house high enough off the ground that past and future damage are not likely? Are the floors and walls fairly level? Etc., etc.

2. Architecture: For an older house (which is what I expect you’re talking about in east Durham) you want something that has as much original architecture as possible, because it will look better and be of better materials. I’m not inclined to buy a 1920s house with crummy windows added in the 70s. They don’t look right and usually have problems. Asbestos shingle siding over the wood is good because it protects the original wood. Aluminum or vinyl is bad because it lets water in and allows the wood underneath to rot. Etc., etc.

3. Neighborhood: How is it compared to what it was five years ago? What will it do in ten years? Is it near cool stuff? Is it a rough neighborhood surrounded by better areas, or is it surrounded by rougher areas? Does it have much architectural integrity? In other words, are there nice houses to fix up around the house you’re looking at, or are they mostly too messed up, or were they crummy to begin with? Are there homeowners around who care about their property and neighborhood, or are the other houses all in the hands of slumlords? Etc., etc.

None of these issues are deal-breakers; they are all factors in what is a good deal.

Then there are the personal factors: Does the house and neighborhood appeal to you in particular? Would you enjoy living there? This is different for every person. Some want peace & quiet; others like more activity. Some want crime-free while others are up for a little adventure, and care more about charm and character. Some want perfect right now; others are willing to endure some rough years knowing the future is brighter.

I was lucky to have looked at the MLS just as this house was put on the market. I easily could have missed it. Now I have a realtor keeping a lookout for me. A friend of mine says that when it comes to these “up and coming” old neighborhoods, none of the houses on the market are good deals. Because if they were good deals, they would have been sold already. A bit of an exaggeration, but it’s true that good deals don’t last.

This is another reason to move to a city and get to know it before you buy. You’ll know what a good deal is and you’ll know where you will be happy. After I moved to Raleigh in 1986, I rented for three years, keeping an eye out, waiting for that great deal on a wonderful house. I found it in 1989 and have been so happy here for 18 years! Now I try to help other people find good deals, too!

This is a great post. Thanks for sharing that experience MisterBrown!

MY only regret is I have but one rep point to give you!

[scorp200]

Originally Posted by North_Raleigh_Guy

This is a great post. Thanks for sharing that experience MisterBrown!

MY only regret is I have but one rep point to give you!

I agree!!!

[scorp200]

Originally Posted by Bezzled

Im in St.Pete waiting to sell my condo.

I am waiting to move to Raleigh.

Oh boy...best of luck to you! The market has to turn around there soon. I know the condo market is particularly gruesome but maybe the worst is over!

[tarp]

Another key thing is to never be too invested in a real estate transaction, because if you let emotion take over, you will make bad financial decisions. No matter how perfect a property is, there will always be better ones if you just keep your eyes open in the future.

[North_Raleigh_Guy]

Originally Posted by scorp200

in a rapidly up and coming East Durham neighborhood? (those who would warn me away from the neighborhood...thank you very much and I understand your concerns but I will be just fine...)

The house is under $75K. For many reasons and in the listing it seems to be my dream house. I'll drive by it later.

I don't feel I'm financially ready to buy a house (now those who have opinions on this - I welcome them - I've never owned a home)

Because this house is somewhat of a gem I am concerned that if I offer below asking price it could easily get snapped up by someone else. But you don't want to be dumb and just pay the asking price? I also would have to break my lease and pay them 2 months to do so, and hadn't planned on looking until next year.

Thanks!

So did you make a move on this house? If so how did it go?

[scorp200]

Originally Posted by North_Raleigh_Guy

So did you make a move on this house? If so how did it go?

Not on that one - but there are nicer ones available in better shape for $5,000 more. Now the issue is - do I really see myself staying here for five years? I'm about to turn 40 - and single - and to buy a home in a location where I like but don't love...I dunno.

(I love Durham, but the rest of the triangle does remind me of suburban NJ, which is fine, just not where I want to commit to buying a home)

I really, really miss living near an ocean or large lake. So I'm probably going to continue renting for a bit :-/