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Thread: Advice on Buying a House

  1. #31
    Waitin til next year bucksfan2's Avatar
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    Re: Advice on Buying a House

    Just a couple of thoughts to add.

    -The 15 year mortgage is a great idea. The payments aren't all that much higher because the rate is lower. If you can afford it, do it, if not, consider a refinance down the road (although rates will probably be higher.) If you stick with a 30 year mortgage, aim to make an extra payment once a year. Those tend to pay benefits down the road.

    -Not a fan of borrowing against your retirement fund, but can't speak to others financial situations.

    -My wife and I bought our first house right around the market crash. We got what we thought was a great deal, it kinda was, but we also stayed in the house for close to ten years. If it is a mass produced house, you will replace a lot of things. If there is carpet, you will replace carpet. A lot of homes people skimp on windows, just realize those may not be the most efficient. In our first house, we replaced the counter tops, we added a room and shower in the basement, replaced all the light fixtures, updated our master bath, and we painted every single room in the house, multiple times. Learn how to do a lot of household repairs and you will save a ton of money. Google "how to fix ........" and there is good youtube video showing you how to do something. Even on the house we built recently, there are repairs we are doing.

    -I don't ever consider something to be my dream home. Things change, jobs change, what you wanted years ago no longer apply.

    -School districts matter, especially for resale value.

    -I never view my home as an investment, I view it as a home. Do the things you want to do to make it your home.

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  4. #32
    Moderator Kinsm's Avatar
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    Re: Advice on Buying a House

    Quote Originally Posted by RedTeamGo! View Post
    Donít make the mistake I made and buy a 100 year old house. Constant repairs.
    Nothing wrong with that if you build that into the offer price. I bought a Craftsman from 1924, basically have rebuilt the inside of it - but that's why I offered so little to begin with - I knew it had to be done.

    Hate to break it to you all, but a lot of new homes are made cheaply too.

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  6. #33
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    Re: Advice on Buying a House

    Like Roy Tucker I live in a suburban community known for it's schools. We moved here when my daughters were of middle school age and our previous community repeatedly failed to pass school levies. My girls wailed about it at the time, but thanked us once the school year started. They are in their mid-20's now and have successful classmates in all walks of life. While the home we bought was a little more pricey than the one in our old community, it's a LOT less house. Taxes were the same. Similar neighbors. Buying for school district is a good idea and a long term investment in your kids in this part of the world, just expect less house.

    The home that we bought is now 60 years old, but was constructed by a fantastic builder. While the house needed cosmetic updates, I have spent FAR less in time and money maintaining this house than I did previous cookie-cutter national builder homes elsewhere. I hate to be a "get off my lawn you kids" old man, but things used to be built for permanence while now 10 years is seen as long term. I don't know HOW you find that kind of construction, but I'm glad I did.

    It's become a popular punchline, but location really does matter. I'm a minute from a highway exit and I did not realize the value of that when purchasing. My commute is done the second I'm off the highway where if we had purchased further from that exit I could be looking at an extra 15-45 minutes for each leg of each commute depending on the time of day. For work and recreation I'm at that highway interchange 4 times many days. That means a home further from the exit would cost me a couple of extra hours commute a day. I enjoy time in my car, but not that much.
    "Even a bad day at the ballpark beats the snot out of most other good days. I'll take my scorecard and pencil and beer and hot dog and rage at the dips and cheer at the highs, but I'm not ever going to stop loving this game and this team and nobody will ever take that away from me." Roy Tucker October 2010

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  8. #34
    Member North's Avatar
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    Re: Advice on Buying a House

    Quote Originally Posted by RedTeamGo! View Post
    Don’t make the mistake I made and buy a 100 year old house. Constant repairs.
    Regardless of age, it's a good idea to add an endorsement to one's homeowners policy to cover repairs to the water pipe and drain pipe between your house and the mains. Mine costs me $103. Includes a lot of other things, too...notable ones being paying for 2 years of temporary housing, and $40,000 cover costs associated with new ordnanaces and laws.

    Not bad for 28 cents per day.

    EDIT...a thought about property damage insurance for vehicles. It pays to check what the coverage level is for property damage. Today's cars are SO expensive. Repairs are SO expensive. Average new car cost in America passed 30k several years ago.

    A typical full coverage policy may have $20,000 property damage coverage. That's not enough these days...you hit another vehicle, the repairs, the totalling...you could be sunk. Bankrupted. You can up the coverage pretty cheaply.

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    Last edited by North; 12-12-2019 at 01:21 AM.
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  10. #35
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    Re: Advice on Buying a House

    Thanks to all for the input. Very helpful to take RZ's temperature on this. Not a lot of real estate experience among my family and friends, so I find it difficult to get real advice like this from the people I can talk to in-person.

    With our scars from the 2008 recession, we are scared to get back on the market at all, and especially averse to being house poor again. That's why we terminated our contract before the 10-day window was up. We may be done with this for awhile; seems like we are priced out of the places we actually want to buy in Atlanta.
    "Iíll kind of have a foot on the back of my own butt. Thatís just how I do things.Ē -- Bryan Price, 10/22/2013

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  12. #36
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    Re: Advice on Buying a House

    We sold our house last summer after owning it for 26 years - it was someone else's turn to cut grass, rake leaves and shovel snow. Plus we wanted to get out in a buyers market. We are renting for a while before we move into an even smaller property (likely a condo) in a few years and will move even closer in to the heart of DC.

    Roy had good advice about doing your own housework - but I would add also know your limitations. Not being handy, I had to use plumbers, electricians and others for various projects over the years - however, I did two things that I recommend: 1. Watch and learn what they do - over time, you will actually learn to do some of the things you never thought you could do and 2. If you use someone for a long time and grow dissatisfied with their work, move one.

    Good luck, eventually you'll find that property.

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  14. #37
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    Re: Advice on Buying a House

    Quote Originally Posted by Strikes Out Looking View Post
    We sold our house last summer after owning it for 26 years - it was someone else's turn to cut grass, rake leaves and shovel snow. Plus we wanted to get out in a buyers market. We are renting for a while before we move into an even smaller property (likely a condo) in a few years and will move even closer in to the heart of DC.

    Roy had good advice about doing your own housework - but I would add also know your limitations. Not being handy, I had to use plumbers, electricians and others for various projects over the years - however, I did two things that I recommend: 1. Watch and learn what they do - over time, you will actually learn to do some of the things you never thought you could do and 2. If you use someone for a long time and grow dissatisfied with their work, move one.

    Good luck, eventually you'll find that property.
    My buddy in Alexandria is looking now for a house in the 'burbs. They currently own a 2/2 condo. If they get to the point they're ready to sell, should I try to connect you two?
    Gratitude + Forgiveness = Happiness

  15. #38
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    Re: Advice on Buying a House

    Quote Originally Posted by RedEye View Post
    Thanks to all for the input. Very helpful to take RZ's temperature on this. Not a lot of real estate experience among my family and friends, so I find it difficult to get real advice like this from the people I can talk to in-person.

    With our scars from the 2008 recession, we are scared to get back on the market at all, and especially averse to being house poor again. That's why we terminated our contract before the 10-day window was up. We may be done with this for awhile; seems like we are priced out of the places we actually want to buy in Atlanta.
    There is very good information here regarding actually buying a house, but I am really glad for you that you held off. You mentioned before about the stress of it and borrowing from retirement, and no one needs that. Also, people really need to get over the idea that buying a house is part of life. It doesn't need to be. I mean, I built a house when I moved here, but it's because I needed a shop and lab built onto it, and rental properties usually look down on that stuff. But if it wasn't for that, I would have rented forever. Let the house be someone else's problem.

    Also, you really have to look at the true cost of buying/owning a house. My son and DIL, who are in their mid-20's, have a life plan where they want to retire in their early 40's. After college, the first thing they did was rent a nice apartment in a new development. People said they were stupid and should buy a house as an investment, but they are not stupid. If you get right down to it, there is more to owning a house than just the mortgage. These are just a few things that come to mind:

    1. Mobility. A great job or opportunity come up two hours away? Moving is a cinch, especially in a newer place where the places are in demand and the property administrator or will work with you.
    2. You know exactly what it's going to cost month to month.
    3. You don't have to worry about anything. Hell, my DIL called maintenance to kill a spider once (and yes, she is still very embarrassed about it).
    4. You can save tens of thousands of dollars on all the crap you don't need to buy. Right off the top of my head, you don't need to buy a lawn mower, garden tractor, garden hose, rakes, shovels, ladders, bags of stuff for water treatment, flowers, patio furniture, gas grill, and a thousand other things.
    5. A good place will provide all of the amenities- they have a pool, fire pit, grill station, pool table, an awesome workout center, and a party room they can reserve for free. It's all literally within a one minute walk. And because they don't have to worry about taking care of anything, they have much more time to enjoy it.
    6. Again, zero maintenance. They don't have to worry about a hot water heater, broken window, upgrading the kitchen, or even spreading mulch. The grounds are impeccable, and the place is adjacent to a city park.

    So, they pay $1300 a month for everything except for electricity, and they sock half of their combined income away every month and there are never any surprises. They would like to have a child in a few years, but the place is a two bedroom and will serve them fine. They are going to have a very comfortable stress-free life, and more power to them.

    My gf has one of those suburban cookie cutter homes, and although it is really nice, and she has been smart with her money, she will admit that she will just break even. Every spring she has to buy a bunch of mulch, this summer the garage door broke, her water heater broke, and she is just now replacing the kitchen countertops because she knows no one would want a ca 2001 kitchen 20 years later. This doesn't even count all of the other stuff I mentioned above, as well as the time and effort maintaining the place.

    So, I guess what I'm trying to say is if you really want a house, that's fine, but it's almost like it's something that's expected now, and it doesn't need to be. And although a lot of people will brag about how much money they made, a lot of people really get screwed, and even the ones that make money probably aren't including all of their Home Depot receipts. Good luck to you.

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  17. #39
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    Re: Advice on Buying a House

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  18. #40
    Where's my chair? REDREAD's Avatar
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    Re: Advice on Buying a House

    Quote Originally Posted by RedEye View Post
    Am I understanding correctly that, we a family of four, will qualify for $24K for being married and $12K for each kid to equal $48K?
    Unfortunately not.. The 24k is a standard deduction for married filing jointly.
    There is a deduction for dependents, but that is not as much. I don't remember the exact amount.
    They do still have the child tax credit (or at least they did last year), which is a big help for parents with kids.

    You have gotten good advice overall here.. But since the primary reason you are buying a home is to give your kids a better quality of life, I would not be so worried about the loan from your 403. Yea, it's not ideal but
    it makes sense to have the home while the kids benefit.

    Another thing to check.. this is obvious, but check on property taxes.. Overall, they have skyrocketed over the last 25 years or so. Maybe Atlanta is not so bad, but my county has gone way up.
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  19. #41
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    Re: Advice on Buying a House

    Quote Originally Posted by BernieCarbo View Post
    There is very good information here regarding actually buying a house, but I am really glad for you that you held off. You mentioned before about the stress of it and borrowing from retirement, and no one needs that. Also, people really need to get over the idea that buying a house is part of life. It doesn't need to be. I mean, I built a house when I moved here, but it's because I needed a shop and lab built onto it, and rental properties usually look down on that stuff. But if it wasn't for that, I would have rented forever. Let the house be someone else's problem.

    Also, you really have to look at the true cost of buying/owning a house. My son and DIL, who are in their mid-20's, have a life plan where they want to retire in their early 40's. After college, the first thing they did was rent a nice apartment in a new development. People said they were stupid and should buy a house as an investment, but they are not stupid. If you get right down to it, there is more to owning a house than just the mortgage. These are just a few things that come to mind:

    1. Mobility. A great job or opportunity come up two hours away? Moving is a cinch, especially in a newer place where the places are in demand and the property administrator or will work with you.
    2. You know exactly what it's going to cost month to month.
    3. You don't have to worry about anything. Hell, my DIL called maintenance to kill a spider once (and yes, she is still very embarrassed about it).
    4. You can save tens of thousands of dollars on all the crap you don't need to buy. Right off the top of my head, you don't need to buy a lawn mower, garden tractor, garden hose, rakes, shovels, ladders, bags of stuff for water treatment, flowers, patio furniture, gas grill, and a thousand other things.
    5. A good place will provide all of the amenities- they have a pool, fire pit, grill station, pool table, an awesome workout center, and a party room they can reserve for free. It's all literally within a one minute walk. And because they don't have to worry about taking care of anything, they have much more time to enjoy it.
    6. Again, zero maintenance. They don't have to worry about a hot water heater, broken window, upgrading the kitchen, or even spreading mulch. The grounds are impeccable, and the place is adjacent to a city park.

    So, they pay $1300 a month for everything except for electricity, and they sock half of their combined income away every month and there are never any surprises. They would like to have a child in a few years, but the place is a two bedroom and will serve them fine. They are going to have a very comfortable stress-free life, and more power to them.

    My gf has one of those suburban cookie cutter homes, and although it is really nice, and she has been smart with her money, she will admit that she will just break even. Every spring she has to buy a bunch of mulch, this summer the garage door broke, her water heater broke, and she is just now replacing the kitchen countertops because she knows no one would want a ca 2001 kitchen 20 years later. This doesn't even count all of the other stuff I mentioned above, as well as the time and effort maintaining the place.

    So, I guess what I'm trying to say is if you really want a house, that's fine, but it's almost like it's something that's expected now, and it doesn't need to be. And although a lot of people will brag about how much money they made, a lot of people really get screwed, and even the ones that make money probably aren't including all of their Home Depot receipts. Good luck to you.
    I agree owning a house isn't the slam dunk it once was but let's look at your kid's situation. You can easily get a $200K mortgage plus prop taxes for $1300/mo. 30 yrs later you'll have a house that's worth at least $400K that you own free and clear. Your $1300/mo rent will likely be about $2500/mo and you're in your mid 50s. And God bless them if they have a kid and plan to retire while the kid's a teenager. Everyone I've ever known that retired young never had kids. That changes a lot.

  20. #42
    Member BernieCarbo's Avatar
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    Re: Advice on Buying a House

    Quote Originally Posted by Sea Ray View Post
    I agree owning a house isn't the slam dunk it once was but let's look at your kid's situation. You can easily get a $200K mortgage plus prop taxes for $1300/mo. 30 yrs later you'll have a house that's worth at least $400K that you own free and clear. Your $1300/mo rent will likely be about $2500/mo and you're in your mid 50s. And God bless them if they have a kid and plan to retire while the kid's a teenager. Everyone I've ever known that retired young never had kids. That changes a lot.
    You are ignoring what I said about the additional expenses of owning a home and things like more mobility and opportunity. How about a lawn tractor that someone buys for $500? What would that $500 be worth if it was invested instead? And that is just the tip of the iceberg. Sit down and add up every single thing you bought during the last ten years that you wouldn't have bought if you were renting and you will see what I mean (note that their rent even includes internet and cable, so that is over a grand a year right there that they are saving). And running the numbers game when talking about how much rent will cost in 30 years works both ways, because they would be making much more too.

    They will easily be able to retire. They have run the numbers, and that is their goal. As for kids, they are as expensive as you want to make them.

  21. #43
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    Re: Advice on Buying a House

    Quote Originally Posted by BernieCarbo View Post
    You are ignoring what I said about the additional expenses of owning a home and things like more mobility and opportunity. How about a lawn tractor that someone buys for $500? What would that $500 be worth if it was invested instead? And that is just the tip of the iceberg. Sit down and add up every single thing you bought during the last ten years that you wouldn't have bought if you were renting and you will see what I mean (note that their rent even includes internet and cable, so that is over a grand a year right there that they are saving). And running the numbers game when talking about how much rent will cost in 30 years works both ways, because they would be making much more too.

    They will easily be able to retire. They have run the numbers, and that is their goal. As for kids, they are as expensive as you want to make them.
    There's only so much space and I like to keep my posts short. I also didn't talk about paying rent from age 55-85 either. Let's be generous with maintenance on the house. Let's say you spend $10K yr on lawn services, fixing things etc. You're up to $300K. Interest on the money, say you get to $400K. You've still got to pay rent for the rest of your life.

    Most folks would likely reinvest the equity in their house and move up a couple times and they'll likely end up with a really valuable house to sell as they're pricing retirement communities.

    To each their own. If you're in a good situation renting; don't have low-life neighbors with whom you're sharing a wall, good landlord etc, I can see the appeal of not having maintenance worries, but in the end it's hard to justify putting equal amounts of money into rent that could be spent on mortgage if you're planning this from your late 20s.

  22. #44
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    Re: Advice on Buying a House

    Eh, different strokes for different folks.

    Renting is great for some, owning a house/mortgage is great for others.

    Bernie, I respect your perspective on things, but holy smokes man, you are seriously the biggest know-it-all I’ve ever come across. No offense, as you certainly do know a lot.
    What would you say.....ya do here?

  23. #45
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    Re: Advice on Buying a House

    Quote Originally Posted by RedTeamGo! View Post
    Eh, different strokes for different folks.

    Renting is great for some, owning a house/mortgage is great for others.

    Bernie, I respect your perspective on things, but holy smokes man, you are seriously the biggest know-it-all I’ve ever come across. No offense, as you certainly do know a lot.
    You deride him for his philanthropy yet you'd be the first one to complain if he was charging you for the definitive perspective on all things.


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