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Old 06-16-2014, 10:26 AM
 
Location: Plano, TX
402 posts, read 1,518,932 times
Reputation: 386

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Hi everyone,

My fiance and I are beginning the process to look for our first home. We are in our mid to late 20s.

We are struggling a bit with trying to figure out the best place to look, if the market is really as hot as the realtor(s) we have spoken to are saying, etc.

A few of the questions we have:

If you were in our shoes, where would you look for a home? Some notables about us: We highly prefer the suburbs. We want good schools as we are looking to have kids in the next couple of years. We work in Addison and Carrollton respectively and would prefer around a ~30 minute commute. We are looking to spend up to $250K and we have a combined household income of $150K/yr. We could probably afford a bit higher, but $250K is about the max we could put 20% down on. We would preferably like to look for a house that we can "grow into" so that we don't have to pick up and move again once we have kids - so we would be looking for a 3 to 4 bedroom, 2 bath ideally.

How old of a house should we be looking for? This has been one of our concerns. We currently live in a condominium in the Canyon Creek area of Richardson. We love the area, but our concern is a lot of the houses are a bit older and seem dated on the inside for the most part. They would require a lot of work to get them to a "livable" condition for us which would put that area outside of our budget for the most part. Are there risks associated with much older homes, or is it even worth it to look at those?

Is it a smart idea to purchase a home at a lower price and remodel/update ourselves? The advantage that we have is the condo we live in is owned by my parents, so we aren't in any "We have to purchase by the end of the month or we have no place to live" type situation. Is it worth to think about remodeling a property ourselves?

If anyone knows of any seminar/webinar type deals going on for first time home owners, let me know. We would be interested in learning more.
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Old 06-16-2014, 10:47 AM
 
Location: Great falls mt
13 posts, read 12,843 times
Reputation: 10
Yeah I'm in the same situation haha.would also like to hear the comments
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Old 06-16-2014, 10:52 AM
 
139 posts, read 169,340 times
Reputation: 75
I was in the same boat, and it took us a long time to get our head wrapped around the nuances of home ownership.

For financing, you dont need to put down 20%, you can put as little as 5% for a conventional loan and possibly refinance later. What I mean is, don't let the 20% downpayment criteria hold you back on buying a house you love and can afford. Also your salaries will increase in later years and the house payment will more or less be the same

What I suggest is go look at houses that are in your current price range, if you have $250k as the range , look at houses at $275k and below. Look at open houses etc to study the neighbourhood, the kind of house you get and trust me all your questions will get answered and you will be in a better position to know what you really like and want as you see more and more properties.

Also check out new construction, again you can really see the pros and cons of new vs old and make a decision of what is important to you...
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Old 06-16-2014, 10:54 AM
 
4,181 posts, read 4,346,464 times
Reputation: 4758
Quote:
We love the area, but our concern is a lot of the houses are a bit older and seem dated on the inside for the most part. They would require a lot of work to get them to a "livable" condition for us which would put that area outside of our budget for the most part. Are there risks associated with much older homes, or is it even worth it to look at those?
If this is a home you are going to own for many years, there are no answers to these questions, just personal preferences. If you are looking for the best resale so as to make money (sell within 10 years), then that's a different question.

Honestly, the area you want to live in should come first, based on commute and lifestyle, and the home second. If the area you want to live in has plenty of updated homes, then great. But it's possible that your area and budget may only afford you an older home that has never been updated.

I'd question your 30 min commute first. Is that really what you want? Making that with children and daycare and all that makes a long commute even worse. Are you planning on keeping your job post kids or is someone going to quit and stay home? Does one of you handle household tasks more than the other? Driving home 30 minutes to meet the cable guy then 30 minutes back to work sucks. Think about stuff like that.

Also, do you like home improvements? Do you like (or can pay for) mowing the lawn? This stuff is more important to answer. Do you want to live closeish to friends or do you not care?
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Old 06-16-2014, 11:32 AM
 
705 posts, read 882,644 times
Reputation: 847
Quote:
Originally Posted by stargirl007 View Post
Hi everyone,

My fiance and I are beginning the process to look for our first home. We are in our mid to late 20s.

We are struggling a bit with trying to figure out the best place to look, if the market is really as hot as the realtor(s) we have spoken to are saying, etc.

A few of the questions we have:

If you were in our shoes, where would you look for a home? Some notables about us: We highly prefer the suburbs. We want good schools as we are looking to have kids in the next couple of years. We work in Addison and Carrollton respectively and would prefer around a ~30 minute commute. We are looking to spend up to $250K and we have a combined household income of $150K/yr. We could probably afford a bit higher, but $250K is about the max we could put 20% down on. We would preferably like to look for a house that we can "grow into" so that we don't have to pick up and move again once we have kids - so we would be looking for a 3 to 4 bedroom, 2 bath ideally.

How old of a house should we be looking for? This has been one of our concerns. We currently live in a condominium in the Canyon Creek area of Richardson. We love the area, but our concern is a lot of the houses are a bit older and seem dated on the inside for the most part. They would require a lot of work to get them to a "livable" condition for us which would put that area outside of our budget for the most part. Are there risks associated with much older homes, or is it even worth it to look at those?

Is it a smart idea to purchase a home at a lower price and remodel/update ourselves? The advantage that we have is the condo we live in is owned by my parents, so we aren't in any "We have to purchase by the end of the month or we have no place to live" type situation. Is it worth to think about remodeling a property ourselves?

If anyone knows of any seminar/webinar type deals going on for first time home owners, let me know. We would be interested in learning more.
20% down is obviously ideal, but as other posters mentioned, you can easily still get a conventional mortgage with 5% down at a competitive interest rate with good credit scores (above 740). The benefit of 20% down (aside from more equity in the home) is you don't have to carry private mortgage insurance, which adds to your monthly payment for a period of time and is factored into your DTI. However, unless you have really high revolving debts, I doubt the DTI is any issue for you, even with a 300K home.

I will honestly tell you having lived in newer & older properties that there are many advantages to purchasing a home less than 15 years old. I moved from a 30 year old property to an 8 year old property, and the difference in the home inspection was night & day. The inspector literally found 2 things wrong, both of which cost under $200 to rectify.

He commented on how nice it is that the house had radiant barrier, low-e windows, CAT-5 wiring throughout, etc. Things are just less likely to break in a newer property, and when they do break, the are usually more minor and less costly to fix.

Even a remodeled older house is going to have issues due to the sheer age of the structure (unless maybe it was taken down to the studs).

However, you also have to be careful, because some new houses have shoddy construction and that can be just as bad. I don't think it has to be brand new, but I would advise on "newer."

You just want to get a realtor who specializes in the area you want to move to who can leverage their network to get you in properties before they hit the market so you can really find what you want.
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Old 06-16-2014, 01:39 PM
 
535 posts, read 615,352 times
Reputation: 1060
Putting down 5% sounds like a bad idea. Just because you can doesn't mean you should. I like that the OP is shotting for 20% down. It eliminates the need for PMI or a second mortgage, and gives her enough equity that another housing bust wouldn't put her underwater. It also gives her a more manageable monthly payment so that if she or her husband is without a job for awhile, the payment won't be insurmountable.
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Old 06-16-2014, 03:05 PM
 
12,196 posts, read 23,110,799 times
Reputation: 11182
The age of the house is not important IF it has been well cared for over the years. Make sure you have a good home inspector check the place out. Our home is 60+ years old and has been updated and cared for; the only legit things the inspector could find were relatively small (changing the way the a/c units were zoned to evenly distribute the workload, water heater near end of life, etc) and the sellers made some repairs as a concession. All the major stuff - foundation, roof, wiring, plumbing, etc is in excellent shape! Don't fear old houses; they are MUCH better quality construction than some of the junk built in the 1980-1990's even if the cosmetic aesthetics need some updating to modernize the place. Plus, many older homes have been gut remodeled and have 0-20 year old kitchens & bathrooms.

For your budget and locations, buy the best quality schools you can afford. That probably means looking in Richardson ISD, including Lake Highlands part of Dallas...though there's not much there for $250k anymore. You should also consider the 75229 zip code in Dallas ISD; the DeGoyler and Withers elementary schools are excellet and given you don't even have kids yet, you wouldn't have to consider middle schools for another 10+ years.
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Old 06-16-2014, 08:07 PM
 
250 posts, read 280,168 times
Reputation: 364
I say milk your parent's free condo for as long as you can, save up and wait until you guys have kids. It ain't no shame in this time and age especially if you guys aren't living under the same roof with parents. We all know in Texas housing doesn't appreciate as much as other places so for investment you can't rely on capital gain. The money is made in cash flow (rental).

If you guys really want to own a house now. I say buy an outdated, cheap house in an area where the rental to sales price is favorable such carrollton, central plano or richardson near UTD. Live in it and fluff it up, learn how to do some simple reno. Try to pay it all off. Then when your kids are about go into elementary school and you guys have more money, buy in your ideal location and rent out the starter home.

Last edited by aznkobee; 06-16-2014 at 08:32 PM..
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Old 06-16-2014, 08:51 PM
 
Location: North Texas
24,577 posts, read 34,238,838 times
Reputation: 28402
Keep saving up, and don't restrict yourselves to just Canyon Creek. Check out the Heights area: Heights Park and Richardson Heights. You could get an updated house in your price range and the schools rock.
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Old 06-17-2014, 07:36 AM
 
Location: Prosper
6,257 posts, read 13,487,808 times
Reputation: 9421
Check listings in central Plano. The best suburban schools you'll be able to find, and within your budget. You can probably even afford a home that has been remodeled to some extent at the $250k limit. You'll also be close to Addison and Carrollton.

For your price range, the homes will probably have been built between 1985-1995 in that area. I'd also recommend Frisco, and to a lesser extent, West Allen and West McKinney, so long as you have easy access to 121 for the commute. The homes will be newer and bigger, but the school districts are not as good as Plano.
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