Seriously Debating Buying a Home on Long Island (Huntington, South Huntington: crime, mortgage)
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Just because he has 200-250K for a DP doesn't mean he wants to buy a 600K house and carry a $350K mortgage. He can do fine with a 450K house and a 200K mortgage or maybe a 300K home with a 50K mortgage and build up equity over time...
I'd be surprised if people on LI are this prudent.
I find it sickening that some sellers and real estate agents try and take advantage of new buyers, especially those from "the City" that they think do not know any better.
For the benefit of the OP and anyone in a similar situation, I will list as many as I can think of and add some ways to outwit sellers, real estate agents, and their scams:
Asking Way More Than What the House is Worth. Some sellers and real estate agents still think this is the Real Estate Bubble. Or at least they try and pretend to. When they see a new buyer from the City, they start salivating because they think the person from the City does not know any better when it comes to prices, especially considering property prices are higher in the City. In Nassau, you can look up any house on this website and see what the County assessed the house at (current and future up to 2 years are listed). Yes, often houses sell for more than the assessed value, BUT if the asking price of the house is WAY OFF from what the assessed value is, especially if the assessed value is scheduled to go DOWN in the future, you need to ask yourself if you really want to pay that for the house. Here is the website:
In Suffolk, I believe you have to ask the Town the house is located in. They do not have a website like this.
Real Estate Flippers. If someone is selling a house they just bought recently, see what they paid for it. Look on Redfin for the home's sales history. I saw a home online last year in my sister's neighborhood that was very nice and all updated at a good price. Recently I get an "open house alert" from Redfin about it. The new seller is asking $200,000 MORE than he bought it for. He did not make any further updates to it. Yeah, good luck with that!
Making Improvements to the House Without Proper Permits and COs. This one is a biggie for tax, fee, and fine purposes. If the house you are looking at has improvements such as: pool, fences, sheds, decks, additional bathrooms, additions to the house, central air, finished basement, repurposing an attached garage to a room, etc., etc., the buyer needs to know that the work was done properly and has all current COs or the buyer is in for a big headache. Ask the real estate agent. If s/he isn't worthless, they will know. If you want to buy a house without proper COs, make it a condition in the contract that the SELLER has to take care of the paperwork, fines and fees for bringing the house to a legal condition.
Not Disclosing the Proper Property Taxes. Don't settle for anyone's "guesstimate" of what you will be paying for taxes. Taxes can go up steeply and quickly. You can find the current and projected Nassau County property taxes on the website listed above. Another thing to watch out for is Village property taxes. Often real estate agents do not disclose this on their websites so it "looks like" the property taxes are way less than they really are. Village taxes can be steep in places that have their own police force. If the house you are looking at is located within a Village, call the Village Hall and ask about the property taxes.
New or Updated House in a Bad Area or Bad School District. Shady developers and real estate agents LOVE to hoodwink newcomers from the City into buying something like this. Think! If it looks like too much of a bargain, it probably is for the area. And always find out the reputation of the school district the house you are interested in buying is zoned for.
The Real Estate Agent Who Showed You the House is Working for You. WRONG! Unless you hired a buyer's broker, the real estate agent who showed you the house is working for the seller and legally must try and get the best price for the seller. You are just a customer, not a client. The seller is the one with the contract. It is a good idea to get your own buyer's broker. Choose one with experience, a good reputation, and an official designation as a buyer's broker.
Real Estate Agents Who Direct You to Certain Houses and Stall at Showing Others. Some real estate agents are set on showing what their agency/broker has the contract on so they don't have to share the commission with another agent. If you're working with someone who seems to not get a lot of cooperation from other agencies/brokers in seeing their listed houses, you might want to switch.
Too bad I gave you rep recently...
This is something EVERYONE should read when thinking about entering the LI RE market for the first time.
If I was being honest with the OP as someone insisting that they had to buy on LI - I wouldn't even consider Suffolk in the short term, with maybe the exception of the CSH immediate area... and I'd avoid the south shore of Nassau. JMHO of course...
Not if he wants a starter home just to get INTO a property first..and seriously, what if he wants to buy it in cash and avoid a mortgage? There are people who still do that you know. Just because he has 200-250K for a DP doesn't mean he wants to buy a 600K house and carry a $350K mortgage. He can do fine with a 450K house and a 200K mortgage or maybe a 300K home with a 50K mortgage and build up equity over time... For crying out loud he doesnt even HAVE the kids yet! iYou assume so many things.
You know what? I DO believe you're an attorney! Our little exchange here shows so much. I figured you'd be happy to hear this since you were so mad when I doubted it in the past!
PS: TY for the reps ...
Last edited by I_Love_LI_but; 01-24-2013 at 10:46 AM..
Reason: added PS
This is something EVERYONE should read when thinking about entering the LI RE market for the first time.
If I was being honest with the OP as someone insisting that they had to buy on LI - I wouldn't even consider Suffolk in the short term, with maybe the exception of the CSH immediate area... and I'd avoid the south shore of Nassau. JMHO of course...
TY! Some of this I learned the hard way! So I figured, why let others suffer? Tell them!
Not to point accusing fingers but in general, one of the reasons why I would rather mortgage part of the purchase price as opposed to paying 100% cash is to have the bank somewhat validate whether the house is selling for close to what it's worth.
Not to point accusing fingers but in general, one of the reasons why I would rather mortgage part of the purchase price as opposed to paying 100% cash is to have the bank somewhat validate whether the house is selling for close to what it's worth.
VERY good point!
They'll sure as #^$Q#$*& tell you what it's NOT worth! LOL!
Another point is the tax deductibility factors of having a mortgage.
Another point is, mortgage interest rates are low now and a person who is smart with money, instead of parking all the cash in a house, could put it into other investments and make more money that way.
I would think people who have been able to save $250K (not counting retirement accounts) would be savvy enough to understand all of the above.
Not to point accusing fingers but in general, one of the reasons why I would rather mortgage part of the purchase price as opposed to paying 100% cash is to have the bank somewhat validate whether the house is selling for close to what it's worth.
Not to mention taking advantage of the mortgage tax deduction while Obama and those nutty Republicans haven't taken it away yet.
This and the property tax deduction are really the only things making the COL somewhat bearable on LI. Of course there is stil the matter of AMT if you're making decent cash....
This is something EVERYONE should read when thinking about entering the LI RE market for the first time.
If I was being honest with the OP as someone insisting that they had to buy on LI - I wouldn't even consider Suffolk in the short term, with maybe the exception of the CSH immediate area... and I'd avoid the south shore of Nassau. JMHO of course...
With the Internet, there is no excuse for not finding out every last scrap of detail on your next home. You just need to do the legwork and that can be difficult if both people have jobs and there are also kids to take care of.
A lot of people don't know that you can even go to the local cops to find out about crimes that occurred on your street. I looked at a home in a very, very peaceful gated community and through some detailed research, found that a guy had been arrested on the block for harassment with a dangerous weapon. Maybe he got into the complex from outside, which raises the issue of security. Or maybe he still lives on the block and could end up being my next-door neighbor, which raises a whole other set of concerns. I will certainly check it out further before I consider buying there.
And, good or bad, the Internet is also a great source for investigating anyone who makes an offer on your home. Once you have the name, you can do a search and often find a whole lot more. Sometimes you can find personal circumstances of the buyer (level of employment, urgency to move, sale price of previous home, etc.) that can give you some valuable insights into their motivation to buy your home. Such information can be a great bargaining tool. While you want the negotiation process to remain cordial, it's nice to know your opponents.
Wondering what's the situation with just buying a land/lot and build your own house.
Not that much buildable land around on Long Island.
Get a lot, an architect and a builder; oh, and don't forget some $$, either out-of-pocket or with downpayment and a construction loan.
Depending on how "nice" you want the house to be, figure $175-$250/sqft of living space. (For a high end home keep going up!)
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