Home buying in RVA (Richmond, Fredericksburg: real estate, 2015, apartments)

[harrisce4]

Hi everyone!

Long story short- I was born and raised in Fredericksburg, VA. Went to VCU for 4.5 years for my Bachelor's. Immediately after moved to NYC to pursue my dreams in working at a large ad agency and now 3 years later I am ready to move back!

Only this time- I am not interested in renting. I am interested in home buying. I feel it just makes the most sense. I'm tired of spending so much money each month in rent. So, I've already began saving and currently have $6,000 in savings. My lease does not end here (in Harlem) until June 2015. My goal is to have $20,000 in savings by December 31 (with a monthly savings goal of $1,700/month). Working 7 days/week (3 jobs total), it can be tiresome, but in the end I believe it will help me purchase the right house for me.

The neighborhoods I am particularly interested in (in order of highest to lowest): Henrico/Short Pump (lived in apartments here for 2 years), Chesterfield (my best friend lives here and the area seems peaceful, quiet, safe), and maybe Midlothian (heard it is pricey). Is there any advice anyone can give me with regards to specific neighborhoods (either mentioned above or any additional that would be nice?)

About me: I'm 24 y/o f working in Account Management at a digital ad agency in Manhattan. I am single. I have a lot of great friends in the area, and they are really one of the main reasons why I am moving back. Well, that, and I simply cannot afford to own property here in NYC. After spending a good portion of my early 20s in NYC, it was a fun ride but I'm ready to slow down the pace, maybe settle down in a few years and I really believe Richmond is the perfect place for this. I thoroughly enjoyed my 4.5 years in RVA and cannot wait to be back. I also believe there are many career opportunities for me as well, (if my current company will not let me work remotely). There's The Martin Agency, Madison + Main (where I interned eons ago), and many large companies with Marketing departments.

What I'm looking for: 3+ bedrooms/ 2+ bathrooms, safe neighborhood, between $130K-$150K, low crime rate, with an easy commute to Shockoe bottom/ Carytown since that area tends to be my livelihood and I enjoy going out. I'm unsure if I will offer a live in tenant position. If it makes sense to financially, starting out, I may offer a room for rent to help with utilities, etc.

My friend/real estate agent told me to get in touch with her in January so I am trying to line up all of my ducks in a row ahead of time so if there's any helpful advice you can give me on the process, buying in RVA, maybe what your experience was like, I would greatly appreciate it

So, that wasn't actually a long story- short. That was just a long story- long. Sorry!! lol Thanks for any/all replies in advance!

[cafepithecus]

I just put a contract down on a house so I have a pretty good feel for the current market. You will be hard pressed to find a 3 bedroom, 2 bath, in a safe neighborhood, for $130-$150K. Not unless you are willing to put a lot of work (and therefore, additional money) into a place. That is, unless you are interested in a townhouse or a condo.

[RustinginSeattle]

Originally Posted by cafepithecus

I just put a contract down on a house so I have a pretty good feel for the current market. You will be hard pressed to find a 3 bedroom, 2 bath, in a safe neighborhood, for $130-$150K. Not unless you are willing to put a lot of work (and therefore, additional money) into a place. That is, unless you are interested in a townhouse or a condo.

Cafepithecus, Do you think $300,000 is a doable amount in an area with good schools, or is that still for a problem house?

thanks!

[onevthoki]

Agree on the above townhouse comment. It's possible you could get a house for that price in Enon, but the drive will be longer. I know someone who just purchased a townhouse in Providence in the North Chesterfield and it was above your budget, but it did come in under $200,000.

Rustinginseattle, you will be fine with your budget.

[sls76]

Originally Posted by RustinginSeattle

Cafepithecus, Do you think $300,000 is a doable amount in an area with good schools, or is that still for a problem house?

thanks!

You'll have some options in Henrico, but that's more Chesterfield's sweet spot.

[harrisce4]

Thanks so much for the replies everyone! It looks like I need to up my budget :/

The only reason I prefer $130k-$150k price range is because I know I can save 20% for that. If we bump into the $200k range, I'm not sure I'll have $40k saved up by this spring. I guess a PMI is not the end of the world. I was just hoping to avoid it. I saw a few places on Zillow.com that were within my price range and 3+ bed/ 2+ bath, however the majority of them do appear to be fixer uppers that need a lot of TLC.

Thanks again! I'll just keep on saving in the meantime and see how much I'll be able to save by the new year. If anyone else has any advice for me I'm all ears !

[Riverdog]

If you're willing to live in Chesterfield, perhaps you should keep an eye on the Forest Hill Park and Stratford Hills areas. I'm not certain about Forest Hill Park area, it seems safe enough, but I live in Stratford Hills and it is pretty good. Quiet, tree lined, and occasionally there are deals to be had. I bought a 3/2 for under $200k a little over a year ago. You have to keep an eye out and be ready to go, though.

[cafepithecus]

I know a lot of people get wrapped around the axle about PMI, but it's not a HUGE deal. Just make sure you get a loan where you can get rid of the PMI once you have a certain amount of equity (usually 20%). That's how my loan works. Other loans, you have PMI for the lifetime of the loan. That would suck, for sure.

For me, it was a tradeoff between waiting another year and saving more for a down payment (and not having to pay PMI), or buying now before interest rates possibly go up. Over the long haul, having a lower interest rate was more important to me.

I was offered two loans, one with PMI and one without, but the interest rate without PMI was a full 1% higher. That's a LOT of interest over 30 years!

[novanwbie]

If you can go up to $200-$240, you can get a really nice place in Chesterfield County. At least right now. It all depends on what you want. The smaller houses in Woodlake, Ashbrook and Brandermill are in safe neighborhoods but aren't the newest, fanciest developments. You could get a 3/2 in many of the neighborhoods off Hull Street for around $200k. In your desired range, you're probably looking at a rough neighborhood. There's not much going for $140 in Short Pump or Midlo that I've seen. Unless it's an older townhome, and the resale on a TH can be tough. If you're at $300k you will have lots of options. In looking on Trulia at listings in Midlo, there's one on Brocket Drive that should be in a decent but modest neighborhood that's $155k. That's going to be a family area, though, probably not a lot of other young, single people. There's a decent-looking one in Brandermill for $184k. It might take some looking but you can find a deal in a safe neighborhood. You could also look at the Forest Hill area, an older Cape Cod might fall into your range, as would some of the older ranchers, like in Southampton. And the commute would be easy.

[harrisce4]

@Riverdog- I am ABSOLUTELY open to living in Chesterfield. I think it's a great, safe area. Thank you for your specific suggestions of Forest Hill Park and Stratford Hills. I am looking into those areas right now as we speak. I think it will be wise to pinpoint the specific neighborhoods that I can afford/have an interest in ahead of time so I will not be all over the place this winter. Unfortunately, even if I have an eye out, I am not ready to go yet. So I will start to look at houses on the market just so I get a feel for the average pricing (based on location, sq. foot, upgrades, etc)

@cafepithecus you are so right. I definitely am one of those people hung up about the PMI but I wasn't aware that it is something that could be added on for the lifetime of the loan. I assumed all PMIs will disappear once 20% equity has been established in the home. Yikes. Will definitely have to read through the contract very carefully and make sure that does not happen. I tried the Zillow mortgage calculator and the differences were not too substantial (PMI vs. without PMI). So, if it means I will have less of a downpayment to put down but can afford a larger house in a safer area then it is what it is. As a single female, safety is my #1 priority. A close second would be how much of a fixer upper it is. I have never really had to experience any repairs as I have always rented and had the landlord/super take care of all the maintenance needs. Would prefer a house as 'turn key' ready as possible, so again, this will definitely mean I need to up the budget closer to the $200k range.

@novanwbie it looks like I will have to increase it to that amount to get the things that are most important to me. I will look into Hull Street. Also, Zillow is usually my go-to source, but I will also download the Trulia app and doing some searching on there. Thank you for the Forest Hill recommendation (also suggested by Riverdog)! I had a feeling my range would only qualify me for a townhouse in Short Pump, which is unfortunate because I really love the area; however, I do not want an attached home of any kind. Since it will be harder to resell in the future. Plus, after about 6-7 years of renting and being on top of neighbors year round, I am DESPERATELY looking for some privacy and space.

Really, truly loving all of the suggestions. While there is a lot of information out there on the web about neighborhoods, home buying steps, etc., I prefer to go to forums and hear from people first hand rather than articles written by real estate agents that may not give you the full info of what to expect. I much prefer the candid responses here. Thanks again all!