House buying tips

[wylkell]

This thread is sort of asking for trouble. You cant put down a list of things you think are important for a new home owner (ostensibly to help them when they first visit here) and then say "but you cant refute anything put down"


Downpayments are a great example. Putting a lot down is great if you have excess liquidity, are planning on paying the house off as soon as possible, or just plain can't get a loan without a big one makes sense, but that doesn't mean there is a one size fits all formula. I'd actually say in "this economy" that you'd want to avoid putting too much of a percentage of your personal liquid assets into a downpayment for a home or anything else. Nothing gets you through a recession like cash on hand. Of course, it all plays into how long you want to keep the house, how quickly you want to pay it off (if you do), and what your current job/lifestyle is like. I don't like seeing 20% as a hard fast rule because for a lot of people, it doesn't make sense.

I also disagree on the all-sides masonry item. If you like a stone pattern and find it on all sides of a house, great. If you find it on 3/4 of the house, that's good too, but it shouldn't be a huge thing unless you like that style of siding, cause with most masonry, you cant really change it (you can stain brick, but some people prefer being able to paint their houses).

I think your looking at homes as investments and that's a great thing but from the other point of view, for a person who isn't looking to move in 20 years, i'd say focus more on the "home-ness potential" cause who knows what 20 years will bring and all your planning could be for naught.

[jettsettr]

Originally Posted by G Grasshopper

I don't get this. Is this just an opinion because you like masonary? I've heard people say that there is less upkeep than with other surfaces. But I have a family member in Austin who's house is about 20 years old with wood siding, and they have only had to repaint the trim. And it always looks nice. What's the deal? People all over the country have really upscale houses with many different outside surfaces. Is it just a Texas/Austin thing?

I was wondering about this one too. I did notice the trend is to have quite a bit of brick on ths houses. Is this a style or a functional piece? Does Austin have a big termite problem?

[G Grasshopper]

Originally Posted by jettsettr

I was wondering about this one too. I did notice the trend is to have quite a bit of brick on ths houses. Is this a style or a functional piece? Does Austin have a big termite problem?

I have to say that the masonry bias in the Austin area does bother me a bit, because, from what I can tell, it is a cultural norm that was originated by developers. Perhaps developers were responding to a history of old timer building stone homes in the area. But I would suspect that it was something they did because they felt it would increase their profit margin (isn't that the reason for everything they do?); if they keep saying that a house with stone all around is better/higher quality, eventually, people will buy the argument, and they will pay more for masonry houses, and they will believe their house is of higher quality than the guy next door without stone. Why? Because if you pay extra money for that feature, you will also convince yourself that it was worth it (if you can't convince yourself of that, you will feel bad because you paid for lots of money for something of little value. No one wants to feel like they made a dumb decision, so they will believe that houses with stone are inherently better.) The stone is just a sheathing. Underneath there is as much wood as any other house, so I don't believe this decreases the house's termite resistance. (If someone out there knows better than me on this, I am happy to be corrected.) One thing that I appreciate is that, if you are going to put stone on a house, I am glad that the developers often use local stone that isn't imported from where ever. I know the maintenance on stone/brick is low, although I don't buy the argument that it helps with insulation - stone is a very poor insulator. I don't dislike stone or brick houses. I think houses in many different finishes can be attractive if they are designed well. So while, as I said earlier, I am mildly irritated that this kind of costly house has been imposed on people as the norm, I also agree that it is the norm, and I would not want to fight it. I accept that this is the way it is. It may be that I end up buying a house with a stone exterior, and I'm sure that won't decrease my enjoyment of living there. There are other things to look for in a house that are much more important to me than this.

[ivan_tx]

I would say using a realtor helps only if you know someone personally or you do not have the time to do due diligence yourself, in which case make sure you get a really good one.

Based on my experience selling one house in Chicago, buying one here in Cedar Park, and attempting to sell the Cedar Park house right now, I would not recommend going with an agent, though it is the safest way I guess.

In Chicago (suburbs) we sold our townhouse in Dec 2005 for 200k. When I called an agent that was highly recommended by a coworker, he inspected the house and said it will go for 185 max. I knew the market was overheated, so I decided to list it for a flat fee, and marketed and sold it within a month. He was supposed to be representing me, so he should have had my best interests at heart rather than trying to sell my house for a lower price just to make his commission quickly.

Fast forward Aug 2006. Market is high in the Austin area. We went thro a realtor that was highly recommended and we had also bought a rental property through her a few months earlier. We bought a beautiful house in a great location near Milburn Park in southern Cedar Park for @220k. She did the comps and said that this was a special Drees house that should not be compared to other "ordinary" houses nearby, and came up with a suggested price of $220k. Now she was a really good realtor, she gave good advice and was very diligent in ruling out houses that had even small defects that might affect resale value. but she did not know the "value" of the house, just went by comps, and also, only the comps that she felt would justify the higher price.

Fast forward Mar 2009. We want to sell and move to a smaller condo/townhouse. The market is bad for sellers right now. I approached a realtor who "knows the area really well" and was recommended by a friend who works for this realtor. She did the comps (did not even see the house) and said max it will go for is $215k. Same with two other realtors. They all say based on the comps it will only go for 215 or so. One agent who spent some time on the phone with me pulled up list of houses that sold in 2006 in my area and said I really overpaid in 2006.

I have listed my house for a flat fee.. let's see what happens.

The point is, buying a house is an investment, and most realtors are not good at valuing a home. They just go with the flow and "comps".. They can help you with the logistics of buying, paperwork, bargaining etc. but ultimately you are taking a risk if you assume that they can tell you what a good price is.