Buying a "Recession proof" house (mortgage, mortgage, housing)

[Dad01]

Forgive me for using a cliched term but was wondering what are the basic things one can do to buy a relatively "recession proof " house in this market

Obviously no one can accurately predict when or if the housing prices will go up or go down

In the areas I'm interested in upper midwest , the inventory is low and it is pretty much a sellers market

Here was my general principles I'm sticking with when it comes to finding a relatively recession proof house

1-In a good school district obviously for grade/middle and high school

2-smaller house in a subdivision where most houses are higher priced

3-In a town with relatively stable and diversified economy

4-House which is not turn key ready but one in which I can put some sweat equity over the years

5-Not too big , not too small 4 bed/3 bath on average

6-close to public transportation/major highways

7-single family house , not a condo or town house

8-not more than 30 yrs old

PLEase advise if any of the above assumptions are inaccurate and if there is any other suggestions that can be given

the biggest problem I have right now is that inventory is so low that there is a ton of competition for the good deals and esp from cash only buyers

[BoBromhal]

Originally Posted by Dad01

Forgive me for using a cliched term but was wondering what are the basic things one can do to buy a relatively "recession proof " house in this market

...some other verbiage ...

Own a home that you can comfortably afford with your income stream that can be reasonably counted on.

[homeonthelittlemountain]

I live in the DC area....so a different kinda market but it is not recession proof as some believe.

We made a lot of equity from the homes we owned by choosing our neighborhoods carefully. I would say you’re on track with your list. #1 priority is to buy into the highest rated school district possible. I would question why the house can’t be older than 30 yrs. if it’s in good shape basically....and other homes of the same age in the neighborhood are desirable and selling well. You might be ruling out an excellent school district in an area of older homes.

[Dad01]

Originally Posted by BoBromhal

Own a home that you can comfortably afford with your income stream that can be reasonably counted on.

I plan to buy a house that is not worth much more than 1.5 times my yearly income

Is that reasonable ?

[LifeIsGood01]

Originally Posted by Dad01

I plan to buy a house that is not worth much more than 1.5 times my yearly income

Is that reasonable ?

That sounds very reasonable. Also if you buy a house that is a 3/2 and the total mortgage payment is less then renting a 2/1 you are ahead of the game. Rents will continue to go up and the recession won't lower them and your mortgage won't go up besides insurance and taxes so check that first.

[leastprime]

JMO. Desired house is pretty big. New family formation is 3- 4 people.

[prospectheightsresident]

Look at how previous recessions/market crashes impacted the housing markets in certain parts of the country. I also would buy well within my means, regardless of where you decide to purchase a piece of property.

[BoBromhal]

Originally Posted by Dad01

I plan to buy a house that is not worth much more than 1.5 times my yearly income

Is that reasonable ?

depends on how reliable your income stream is.

[MikeJaquish]

Avoid "Mistake Houses."
A "Mistake House" will be the first in your market to take a price hit, and may be very difficult to re-sell should you need to move on or cash out.

1. Flood plains.
2. Adjacent electrical power transmission lines.
3. Significant structural issues, particularly broken foundations.
4. Poor access due to bad driveways. Sloped up or down. Weirdly curved. Side entry garage that doesn't have adequate clearance for easy entry and exit.
5. Adjacent to loud commercial or industrial nuisances.

And, pay cash, or pay it off or pay down any loan.
Nothing frees you up in any market like not being encumbered by a debt that is more than resale value.

[RosemaryT]

Originally Posted by MikeJaquish

Avoid "Mistake Houses."
A "Mistake House" will be the first in your market to take a price hit, and may be very difficult to re-sell should you need to move on or cash out.

1. Flood plains.
2. Adjacent electrical power transmission lines.
3. Significant structural issues, particularly broken foundations.
4. Poor access due to bad driveways. Sloped up or down. Weirdly curved. Side entry garage that doesn't have adequate clearance for easy entry and exit.
5. Adjacent to loud commercial or industrial nuisances.

And, pay cash, or pay it off or pay down any loan.
Nothing frees you up in any market like not being encumbered by a debt that is more than resale value.

Pay cash?

Okay.

Seriously, I would rather see someone get into a solid-value house rather than wait until they have saved enough to pay cash for a house. Sadly, too many people struggle for years to find a few thousand for a downpayment!

The house that I am in has "poor access" due to a sloped driveway, and a side-loading garage that is hard to get into, and yet it had three offers within 24 hours of being listed. Location trumps everything else.

Here's my best advice: IF a recession hit and you lost 30% of your home's value, would you still be happy to remain there for a decade? Because in a decade, everything can turn around.

People tend to settle when it comes to life partners and homes. My advice: Don't settle.

If you wait for the best, you'll usually find it.