Need advice on negotiation experience with builder (Austin: real estate, apartment)

[TheyCallMeDerek]

Originally Posted by XLadylawX

Before entering into ANY negotiations, ask for a detailed price list of all those upgrades. $20k can be wiped out with just a few choice upgrades. I got the price list for these items from the agent at the model home on a house we are looking at and I racked up $28k in upgrades on minimal stuff. I will show you my list so you can get an idea of what $28k looks like:

Greenbelt Lot-$10,000
Kitchen Island-$ 1,080
Covered Patio-$4,400-It's Texas for crying out loud.
Study Option-$750
Double Oven-$ 2,110 - I COOK!!!
Medicine Cab-$235 - Should be standard for hall bath but not.
Full Light Door-$515 - Frivolous upgrade?
Ceil. Fan FR-$140 - Should be standard
Full Rain Gutters-$1,300-Should be standard - This is criminal to pay extra for full gutters
FirePlace-$2,120-Will likely never use but essential for re-sale
Attic Stair-$210-Should be standard - This one steams me and we may forgo.
Under Counter Lights-$625-Once you have these you can never go back. Essential to me
Water Soft Plumb-$800- May never use but people around here demand them.
Elongated Commode/hall bath-$125
Flat Panel Conduit for TV-$190- Sorry, don't want to see the wires dangling from wall-mounted TV.
Home Theatre Wiring $415-I think in this modern era this should be standard or at least $300 cheaper
Cable in all bedrooms $225-Should be standard
Upgrade on Flooring & Tile-$3,000 (Estimate)

Some people will find my kitchen upgrades frivolous but in my opinion, the kitchen is the most important room in the house. Also, most living is done in this room.

Perhaps you can use part of the $20k in upgrades to upgrade the lot. This will however, eat up what you have leftover for the other stuff.

Good luck with your negotiations.

Looks like most everything you added has good potential for resale value...

To the OP, your Realtor should be able to answer the questions you've posed on this forum. Some suggestions are opinions or based on good/bad experiences and may be different than your Realtor's advice. So go with your gut and be willing to walk away...

[hound 109]

I caught that article today. Very interesting. It shows how government interference in the market really backfires and messes things up. Thank god the incentives are done. Let's just hope Uncle Sam keeps his greasy fingers out of our business long enough for the market to settle out to wherever it needs to be.

I made a graph illustrating what the $8K buyer credit did to our Austin market in April/May. This shows the number of homes that went Pending. The green line is 2010. Thanks to our meddling government it's hard to predict the market now and advise buyers and sellers because we don't know how to properly account for and factor in the weirdness.

I agree 100% with your thoughts Austin Steve.

[eileenkeeney]

Originally Posted by austin-steve

I caught that article today. Very interesting. It shows how government interference in the market really backfires and messes things up. Thank god the incentives are done. Let's just hope Uncle Sam keeps his greasy fingers out of our business long enough for the market to settle out to wherever it needs to be.

I made a graph illustrating what the $8K buyer credit did to our Austin market in April/May. This shows the number of homes that went Pending. The green line is 2010. Thanks to our meddling government it's hard to predict the market now and advise buyers and sellers because we don't know how to properly account for and factor in the weirdness.

That was not hard to predict.

I suspect it messed with tax values (pushing them up).
I am guessing that the market analysis to determine taxable values was effected by the sales data, from sales that happened during the rebate time frame.

So I am guessing that you are not in favor of the lobbying that occurred by the Association of Realtors, related to the credit?

[XLadylawX]

To the RE professionals, what are your thoughts of DH and I waiting until late October to Thanksgiving before making our offer? We are hoping that the builder will be more willing to deal in order to close an inventory House around Chistmas.

[Roadking2003]

Buying a house is like a lot of other purchases, just bigger and more complex, but the basics of supply and demand apply quite nicely.

[austin-steve]

So I am guessing that you are not in favor of the lobbying that occurred by the Association of Realtors, related to the credit?

No, I'm not in favor of politicians artificially influencing the real estate market. I wish they'd all get a stomach virus and remain sick in bed for a year, passing no new laws. That would be the best medicine for our economy. They do more harm than good, in my opinion.

But our Realtor lobby does fend off some stupid stuff, so I'm not usually against what they are trying to do. For example, the Texas Realtors have successfully postponed (in Texas) the elimination of owner financing brought about, once again, by well meaning but wholly incompetent and stupid legislators in Washington.

Essentially, they want anyone who owner finances a home to be a licensed mortgage loan originator, unless it's an owner-occupant selling his primary residence. This is beyond stupid. It's moronic. Owner financing is a valuable and useful financing tool that has been used forever as a form of alternative financing and it wasn't causing any problems. But the new SAFE act changing mortgage rules dragged it in along with a bunch of other stupid rules that actually eliminate good, honest, qualified buyers and sellers from transacting with one another.

Yes, lending got out of hand, But what's happened now is severe over-correction.

Steve

[eileenkeeney]

Originally Posted by austin-steve

But our Realtor lobby does fend off some stupid stuff, so I'm not usually against what they are trying to do. For example, the Texas Realtors have successfully postponed (in Texas) the elimination of owner financing brought about, once again, by well meaning but wholly incompetent and stupid legislators in Washington.

Steve

I don't think that owner financing had anything to do with the mortgage crisis.
In fact, any attempt to eliminate it is most likely being pushed by those who profit from non owner financed loans.

Laws are often infected by those who profit from the outcome.
Even when something could be a good law, they add infectious clauses, as bargaining tools.

I think that we the people should demand that laws carry NO riders at all, unless the rider can be shown to be essential for the core law to be of value.
This way when a representative votes yes or no, it would be much more clear as to what they are really voting for or against.

[trayanh]

These numbers look pretty reasonable, considering my builder charged me 2900 for it.

Originally Posted by XLadylawX

Before entering into ANY negotiations, ask for a detailed price list of all those upgrades. $20k can be wiped out with just a few choice upgrades. I got the price list for these items from the agent at the model home on a house we are looking at and I racked up $28k in upgrades on minimal stuff. I will show you my list so you can get an idea of what $28k looks like:

Greenbelt Lot-$10,000
Kitchen Island-$ 1,080
Covered Patio-$4,400-It's Texas for crying out loud.
Study Option-$750
Double Oven-$ 2,110 - I COOK!!!
Medicine Cab-$235 - Should be standard for hall bath but not.
Full Light Door-$515 - Frivolous upgrade?
Ceil. Fan FR-$140 - Should be standard
Full Rain Gutters-$1,300-Should be standard - This is criminal to pay extra for full gutters
FirePlace-$2,120-Will likely never use but essential for re-sale
Attic Stair-$210-Should be standard - This one steams me and we may forgo.
Under Counter Lights-$625-Once you have these you can never go back. Essential to me
Water Soft Plumb-$800- May never use but people around here demand them.
Elongated Commode/hall bath-$125
Flat Panel Conduit for TV-$190- Sorry, don't want to see the wires dangling from wall-mounted TV.
Home Theatre Wiring $415-I think in this modern era this should be standard or at least $300 cheaper
Cable in all bedrooms $225-Should be standard
Upgrade on Flooring & Tile-$3,000 (Estimate)

Some people will find my kitchen upgrades frivolous but in my opinion, the kitchen is the most important room in the house. Also, most living is done in this room.

Perhaps you can use part of the $20k in upgrades to upgrade the lot. This will however, eat up what you have leftover for the other stuff.

Good luck with your negotiations.

[mrsengle]

Originally Posted by XLadylawX

To the RE professionals, what are your thoughts of DH and I waiting until late October to Thanksgiving before making our offer? We are hoping that the builder will be more willing to deal in order to close an inventory House around Chistmas.

I would also like to hear what the professionals have to say on this. We're also waiting to buy (we have a baby on the way, due in September, so we're holding on to our cash until after that event). We're also hoping that prices will be lower.

[pjoseph2]

Originally Posted by austin-steve

Yes, lending got out of hand, But what's happened now is severe over-correction.

Over-correction, really? Let's see:

• Enormous inventory
• DOM climbing
• Mortgage applications tumbling
• Debt overhang

On a related note, there are more commercial lease and sales signs than bluebonnets blooming. This here in Austin, one of the strongest economies in the country.

We are now back to doing due diligence in lending. Are there any qualified borrowers left?

This in spite of 'our' government's 12,897th program to prop housing up. Note the unlimited LOC for Fannie & Freddie. A taxpayer liability that is estimated at a trillion dollars. The FHA is 95% of the mortgage market.

In short, a long way from a balanced market.