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Old 03-04-2020, 08:21 AM
 
374 posts, read 947,937 times
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Quote:
Originally Posted by Citylife666 View Post
We’ve been trying to buy since 2 summers ago and we are definitely having a very bad luck lol

I think 14k after tax is very doable in lower westchester. Unless you meant gross?



Regarding the market, I would hate to be in your shoes right now, the market has been very hard for buyers. We were in the same shoes last year and our winning strategy was to place a bid within 2 days of listing and over bid. This strategy requires two very important things: 1. Know what you are looking for. You need to be able to tell when the right house comes along immediately, including things like sq footage, features and price. 2. Have vision. Things are over priced right now, but will paying extra be worth it over 20-30 years? This depends on the house and location. If you have any doubts that you will be in that house for the next 20-30 years, I would not buy right now. It will be a big loss if you move in 5-10 years.


With that said, I think your requirement of a house with 2k sq ft seems like a deal breaker. At some point, you will most likely want a bigger house. I specially say this because you mentioned an au pair and those are live in. I don't know you, so I could be 100% wrong. I am just going by averages and experience. A good compromise might be a 2k house with an unpermitted finished basement of 3-500 sqft. But before I get a lot of criticism, yes 2k sq ft is perfectly fine for everyone! I'm just against paying a price premium right now for it! I'd rather pay a premium for 3k+ sq feet.


Regarding your massive down-payment. Everyone is against it because, if that money were in the market, compounding interest would probably make it grow above 3% a year. Whereas, putting it on the mortgage locks it in at ~3% gain. Of course, putting it in the market has its risks, so nothing is guaranteed. If I were you, I would put 20% down and just hold on to the money for a bit and weigh your options. Once, your in the house and settled in you can make your decision. You could always pre pay your mortgage at that point. Either decision is perfectly fine. I just think that is a big decision and you should defer it until the house stuff is taken care of.


Good luck!
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Old 03-04-2020, 08:47 AM
 
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Can I ask which towns you are bidding in? I am looking to move for my son to start Kindergarten next year. Still have some time, but need to sell my apt in Queens in addition to finding a new home. I am now concerned that the market may be too competitive and might have to start the process earlier than planned.
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Old 03-04-2020, 03:13 PM
 
107 posts, read 95,379 times
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Quote:
Originally Posted by Citylife666 View Post
Especially bc I feel like given nobody wants to make a bigger downpayment I’m at the disadvantage.
You keep saying this but I don't understand why you think you're at a disadvantage. Yes your Realtor will want you to spend more so they get a bigger commission and people on this page will advise you to do a smaller downpayment (myself included). But you are at an advantage when it comes to bidding on a house. Having more cash is considered a better offer from the seller's perspective. It means less bank financing which means less risk that either the bank drops out or the house doesn't appraise or any other myriad of issues that come up during closing. This is why 100% cash offers are almost always accepted over an offer from somebody who needs an 80% mortgage.
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Old 03-04-2020, 06:42 PM
 
428 posts, read 232,486 times
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Quote:
Originally Posted by Citylife666 View Post
Thanks. I don’t really want to get into bidding wars (and who wants?!). Especially bc I feel like given nobody wants to make a bigger downpayment I’m at the disadvantage. Realtors really want to push you into buying a more expensive property (with higher taxes of course) once they know you can make a bigger downpayment. I don’t want a bigger house than 2000 sq ft really, neither I actually need it.
I also don’t get why everyone thinks bigger downpayment is bad since the rates are low. Low rates doesn’t mean it’s free and having this money sitting on my savings account doesn’t really make sense either since the max I can get it about 1.7%. Thanks for the words of encouragement!
Have you been in any competitive bidding situations (I.e. at least one other bidder than you)? If not, are you bidding way under the seller’s asking price? If so, you can’t blame the seller for not taking your offer or even engaging you with a counter-offer. If I had a house listed for $1mm and a bidder bid me $750k (25% under ask), I likely wouldn’t even counter since I’d be offended.

I agree, don’t let a realtor pressure you into spending more on a house than you want.

If you take out a larger mortgage, you’d likely have to pay the additional origination costs on the higher notional but like others have said, you could choose to pre-pay it down quicker.

I also agree with the other posters that if you are in a competitive bidding scenario and you bid the same as someone putting down less than 60%, your bid would likely be more attractive. At that point, you could likely waive your mortgage contingency as well to make your bid even more attractive.

I’ll also add that if you have been looking for 2 years, you need to ask yourself what isn’t working for you and address that. It could be that you are bidding too low, it could be that you are looking in peak season where there is too much competition, etc. if you find a house you really love, sometimes you have to bid a littler higher than you would like to.
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Old 03-05-2020, 08:01 AM
 
101 posts, read 55,019 times
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Hey everyone. So a couple of things. 1. We are not looking at nice expensive houses and trying to low ball. So no we don’t offer 750 on a 1MM house. 2. We have been looking on and off and just because we are looking doesn’t mean we bid here and there. So far we made an offer on a house in 2018 and the seller did get offended (it was way overpriced at 780 on a main road, flipped house that eventually went for 735; we offered 715 to begin with and they didn’t want to even talk although later on called my husband at work and did other weird things and we decided not to do anything given they were crazy like that). The second house didn’t go through it was also on a main road priced higher based on our realtors feedback. So we actually always go for a house that’s somewhat not attractive to others but we don’t find it a deal breaker. We also have been looking in Westfield NJ at the same time so yes i feel like we have been wasting time because we are not certain about the area. 3. We are at a disadvantage because we keep hearing that with our income we should be looking at 1.5MM houses when our ceiling is really 870K right now. Because taxes on 1MM are around 30K and we are not ok with that. So yeah maybe we are delusional?... 4. We have been looking in eastchester, mamaroneck, larchmont. 5. 14K is AFTER taxes.
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Old 03-05-2020, 08:39 AM
 
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Those school districts are in a sellers market (see the below article). I believe Larchmont was especially competitive last year. Perhaps you can include some other southern Westchester towns in your search (e.g. Pelham) to increase your odds in winning the bids.

https://suburbs101.com/westchester-s...ellers-market/
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Old 03-05-2020, 12:10 PM
 
374 posts, read 947,937 times
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Quote:
Originally Posted by Citylife666 View Post
Hey everyone. So a couple of things. 1. We are not looking at nice expensive houses and trying to low ball. So no we don’t offer 750 on a 1MM house. 2. We have been looking on and off and just because we are looking doesn’t mean we bid here and there. So far we made an offer on a house in 2018 and the seller did get offended (it was way overpriced at 780 on a main road, flipped house that eventually went for 735; we offered 715 to begin with and they didn’t want to even talk although later on called my husband at work and did other weird things and we decided not to do anything given they were crazy like that). The second house didn’t go through it was also on a main road priced higher based on our realtors feedback. So we actually always go for a house that’s somewhat not attractive to others but we don’t find it a deal breaker. We also have been looking in Westfield NJ at the same time so yes i feel like we have been wasting time because we are not certain about the area. 3. We are at a disadvantage because we keep hearing that with our income we should be looking at 1.5MM houses when our ceiling is really 870K right now. Because taxes on 1MM are around 30K and we are not ok with that. So yeah maybe we are delusional?... 4. We have been looking in eastchester, mamaroneck, larchmont. 5. 14K is AFTER taxes.

I see an issue with your strategy. First, not knowing exactly what you want and where you want is going to lead to weak offers or late offers. In this market, that doesn't cut it. Secondly, going for houses that are not attractive to others is again going to lead to weak offers. Again, weak offers won't cut it. Try to change your strategy so that you can produce strong offers.



Secondly, you are not at any sort of disadvantage. Probably what the realtors are hinting at is that what you are looking for is just not available. Either decrease your requirements or increase your price. Of course, realtors are more motivated for you to increase your price. And they probably don't want to tell you flat out that you are being unreasonable. For two big reasons, 1. they don't want to push you away 2. they don't know every town, so they can't prove that you are 100% being unreasonable.


So my 2cents is that in this market, you have a losing strategy and undervaluing houses. That doesn't mean that you are delusional. It's more that the market is crazy right now and your pricing is not matching the market pricing. Easiest solution is to increase your pricing... I know it's easier said then done! Secondly, decrease your requirements. How about 1500 sqft.. or being further away from train station...etc. Finally, you can just wait until prices come down to reality. I personally prefer waiting... but I think the wait could take multiple years.
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Old 03-05-2020, 12:32 PM
 
101 posts, read 55,019 times
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Thanks. Regarding my requirements... we have 2 kids and we are in need of au pair so we do need 4 bedrooms. We have been looking at houses that are 1700-2000sq ft. I think that’s small enough already. Our upper limit is 850K and mostly bc anything above has taxes close to 30K. We are not looking at new developments, anything big, some houses don’t have walk in closets or master bedrooms... unreasonable? Hm. Idk. I grew up in an apartment with 1 bathroom and shared a bedroom with my brother. I am not spoiled by any means in terms of space. Driving to a station is not an option. We both work in the city and if we need to have 2 cars and parking I might as well pay more for the house. Anyway it seems like we should reconsider NJ(((((
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Old 03-05-2020, 03:32 PM
 
2,881 posts, read 1,092,414 times
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Quote:
Originally Posted by Citylife666 View Post
Thanks. Regarding my requirements... we have 2 kids and we are in need of au pair so we do need 4 bedrooms. We have been looking at houses that are 1700-2000sq ft. I think that’s small enough already. Our upper limit is 850K and mostly bc anything above has taxes close to 30K. We are not looking at new developments, anything big, some houses don’t have walk in closets or master bedrooms... unreasonable? Hm. Idk. I grew up in an apartment with 1 bathroom and shared a bedroom with my brother. I am not spoiled by any means in terms of space. Driving to a station is not an option. We both work in the city and if we need to have 2 cars and parking I might as well pay more for the house. Anyway it seems like we should reconsider NJ(((((
I had dinner with a group of high school friends from lower Westchester recently. One person had sold her parents' house over Christmas. He almost decided to wait to list it because it's a slow real estate time. Well, it sold immediately for the inflated asking price. Not only did the buyer pay the asking price, but paid in cash.

This was a house that had not been upgraded since it was purchased in the 1960's. The new owners have gutted the house to modernize it. Can't imagine how much more this is going to cost.

My friend's house cost less than 30K new in 1960. It is crazy.


sdcity is right:
Quote:
you have a losing strategy and undervaluing houses.
Look for 700K houses. No one is going to drop their house price. Many sellers are seniors downsizing and can wait forever for the right price. However, you could get into a bidding situation and need to raise you price.

I gotta say people love Montclair. A friend lives in Atlantic Highlands and loves it. She takes the ferry to lower Manhattan. It's an expensive ride but quick. You could easily get in Atlantic Highlands, Little Silver or Rumson for under $800K home with taxes under $25,000. There are towns across the GW Bridge which are nice - Dumont is a gem.
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Old 03-05-2020, 03:51 PM
 
101 posts, read 55,019 times
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I am not sure I follow... look for houses under 700K? I’ve been looking for houses under 850. Some are 900))). So how am I undervaluing houses?
I don’t want nj. Westfield is like the only town that doesn’t make me gag. Personal thing. But commute from Westfield is awful. Maybe we need to live in Brooklyn forever. I don’t think it is ok to pay $5-6K a month for mortgage and taxes while your net is 14-15K. But I am probably the minority in this thinking .
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