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Buying a house - anything to be wary of

Buying a house - anything to be wary of

Old Apr 23rd 2017, 7:57 pm
  #31  
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Default Re: Buying a house - anything to be wary of

Originally Posted by Mercury39 View Post
Much prefer this approach in the US vs the English system where you spend weeks between oral agreement and a signed contract where anyone can just 'change their mind'. I liked being in a position where seller and buyer where commited by a contract within days of an offer being accepted.
Yes I agree, now that I know. Although where I live the local realtors will often start a bidding war where they will let people view only on a certain day and then they open all bids at a certain time. Often you view on one day and then need to scramble to put in your offer straight after you see it and then the realtor opens all offers the next day at 9 am, or even the same day you viewed it. Doesn't even give you a few days to decide between a few properties or just weigh up the pros and cons of one place. If you think you like it you have to jump in and it seems to be a way for the realtor to get more money than the asking price. I don't like it, it's probably the biggest purchase you ever make and yet you are given very little time to decide.
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Old Apr 23rd 2017, 8:09 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by becks_r View Post
Yes I agree, now that I know. Although where I live the local realtors will often start a bidding war where they will let people view only on a certain day and then they open all bids at a certain time. Often you view on one day and then need to scramble to put in your offer straight after you see it and then the realtor opens all offers the next day at 9 am, or even the same day you viewed it. Doesn't even give you a few days to decide between a few properties or just weigh up the pros and cons of one place. If you think you like it you have to jump in and it seems to be a way for the realtor to get more money than the asking price. I don't like it, it's probably the biggest purchase you ever make and yet you are given very little time to decide.
That's just a fact of being in a competitive market.
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Old Apr 23rd 2017, 8:20 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by becks_r View Post
Yes I agree, now that I know. Although where I live the local realtors will often start a bidding war where they will let people view only on a certain day and then they open all bids at a certain time. Often you view on one day and then need to scramble to put in your offer straight after you see it and then the realtor opens all offers the next day at 9 am, or even the same day you viewed it. Doesn't even give you a few days to decide between a few properties or just weigh up the pros and cons of one place. If you think you like it you have to jump in and it seems to be a way for the realtor to get more money than the asking price. I don't like it, it's probably the biggest purchase you ever make and yet you are given very little time to decide.
What you describe is a new phenomenon due to a huge demand in some areas. I just sold my house last
Week in small town Tennessee expecting it to take all summer to find a buyer. To my surprise we had three offers
In two days and got 10k over asking price. Some areas are much worse with 10 offers within hours of listing. I
Think the low interest rates, with fears of them rising are fueling the market.
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Old Apr 23rd 2017, 8:39 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by becks_r View Post
Yes I agree, now that I know. Although where I live the local realtors will often start a bidding war where they will let people view only on a certain day and then they open all bids at a certain time. Often you view on one day and then need to scramble to put in your offer straight after you see it and then the realtor opens all offers the next day at 9 am, or even the same day you viewed it. Doesn't even give you a few days to decide between a few properties or just weigh up the pros and cons of one place. If you think you like it you have to jump in and it seems to be a way for the realtor to get more money than the asking price. I don't like it, it's probably the biggest purchase you ever make and yet you are given very little time to decide.
I can relate to that, current house we own, I looked at it for 20 minutes and then made an offer over asking. I've spent more time buying a pair of shoes!
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Old Apr 23rd 2017, 11:06 pm
  #35  
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Default Re: Buying a house - anything to be wary of

Originally Posted by ddsrph View Post
What you describe is a new phenomenon due to a huge demand in some areas. I just sold my house last
Week in small town Tennessee expecting it to take all summer to find a buyer. To my surprise we had three offers
In two days and got 10k over asking price. Some areas are much worse with 10 offers within hours of listing. I
Think the low interest rates, with fears of them rising are fueling the market.
I wouldn't have minded that so much, its one thing to put the house on the market, have lots of people come to see it and then get 3 offers in 2 days - that is purely down to supply and demand in that area and that is understandable.
But it is totally different for a realtor to create a situation by only allowing the house to be viewed for one day and then demanding all offers to be in place by the next day, that creates a bidding war and possibly gets a higher price that really isn't justified. The house had only been on the market for a few hours and there are, currently, 70 houses listed online that match our criteria, as much as you can match what we actually want using their filters! Creating a bidding war like that doesn't match the real situation here.
But that said, the house was lovely, ticked all the boxes and if it had been put up for sale the normal way, the owners would probably have had a few offers quite quickly anyway. It just left me hating the realtor for creating an artificial situation
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Old Apr 23rd 2017, 11:09 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by Mercury39 View Post
I can relate to that, current house we own, I looked at it for 20 minutes and then made an offer over asking. I've spent more time buying a pair of shoes!
Ah yes, shoes!! I have been known to spend hours in a shoe shop and come out with 10 pairs of shoes!! and I did travel to Italy with an empty suitcase to fill with shoes
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Old Apr 24th 2017, 8:58 am
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Default Re: Buying a house - anything to be wary of

Is there anyone on here that believes that buying a house before having GC in hand can be an acceptable option in the right circumstances?

I'm moving out to Boston from the UK next month and then am relocating down to FL (unsure where yet) in the Autumn. UK house is currently on the market (its the right time to sell regardless of this move) and our plan is to rent in FL initially whilst we find the area we'd like to be in longer term, and then look to buy. I'm on an L1-B visa and my employer will begin the GC process on my behalf in January 2018.

Whilst I understand the risks of buying on a visa and that the GC is by no means a certainty, the way I've looked at it is that if we were to buy in mid-2018, we'd have a solid 4 years in that house secured by the visa. If our GC application was successful then the risk has been worth it, but if the worst was to happen and we had to leave the US at the expiry of the visa then I could sell the house and whilst may not make any money on it, I'd have saved 4 years worth of rent to offset against any losses (if indeed there were any).

Is that logic sound or am I completely mental?
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Old Apr 24th 2017, 10:08 am
  #38  
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Default Re: Buying a house - anything to be wary of

Originally Posted by jammiie View Post
Whilst I understand the risks of buying on a visa and that the GC is by no means a certainty, the way I've looked at it is that if we were to buy in mid-2018, we'd have a solid 4 years in that house secured by the visa. If our GC application was successful then the risk has been worth it, but if the worst was to happen and we had to leave the US at the expiry of the visa then I could sell the house and whilst may not make any money on it, I'd have saved 4 years worth of rent to offset against any losses (if indeed there were any).

Is that logic sound or am I completely mental?
Have you drawn up a cost sheet looking at rent vs buying over 5 years, looked fully into all the costs involved, including taxes, realtor fees etc? I say 5 years because whenever this topic crops up, there is a general rule of thumb that it takes roughly that long to get to break-even point, depending on your location. You also need to fully understand your risks, eg job security while on your L1 - will you be on local T&C, do you understand what it means if someone says Florida is an "at will state", or the implications for your visa if your company is taken-over or sold? Will you have any repatriation clauses in your contract?

The British mentality is very fixed towards "renting is dead money", but it really isn't in situations like this - it buys you the roof over your head, the freedom from having to worry about repairs and maintenance and the flexibility to walk away if needed. Plus the way the housing market works here can be different enough in the US to make any assumptions based on the UK market invalid.

There isn't a right or wrong answer, but the best path for you will be determined by your tolerance for risk. Make sure you have all the relevant facts before deciding.
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Old Apr 24th 2017, 10:15 am
  #39  
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Default Re: Buying a house - anything to be wary of

Originally Posted by yellowroom View Post
Have you drawn up a cost sheet looking at rent vs buying over 5 years, looked fully into all the costs involved, including taxes, realtor fees etc? I say 5 years because whenever this topic crops up, there is a general rule of thumb that it takes roughly that long to get to break-even point, depending on your location. You also need to fully understand your risks, eg job security while on your L1 - will you be on local T&C, do you understand what it means if someone says Florida is an "at will state", or the implications for your visa if your company is taken-over or sold? Will you have any repatriation clauses in your contract?

The British mentality is very fixed towards "renting is dead money", but it really isn't in situations like this - it buys you the roof over your head, the freedom from having to worry about repairs and maintenance and the flexibility to walk away if needed. Plus the way the housing market works here can be different enough in the US to make any assumptions based on the UK market invalid.

There isn't a right or wrong answer, but the best path for you will be determined by your tolerance for risk. Make sure you have all the relevant facts before deciding.
This is good advice. I would say the same thing and can't think of anything that I would add.
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Old Apr 24th 2017, 10:47 am
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Default Re: Buying a house - anything to be wary of

Originally Posted by yellowroom View Post
Have you drawn up a cost sheet looking at rent vs buying over 5 years, looked fully into all the costs involved, including taxes, realtor fees etc? I say 5 years because whenever this topic crops up, there is a general rule of thumb that it takes roughly that long to get to break-even point, depending on your location. You also need to fully understand your risks, eg job security while on your L1 - will you be on local T&C, do you understand what it means if someone says Florida is an "at will state", or the implications for your visa if your company is taken-over or sold? Will you have any repatriation clauses in your contract?

The British mentality is very fixed towards "renting is dead money", but it really isn't in situations like this - it buys you the roof over your head, the freedom from having to worry about repairs and maintenance and the flexibility to walk away if needed. Plus the way the housing market works here can be different enough in the US to make any assumptions based on the UK market invalid.

There isn't a right or wrong answer, but the best path for you will be determined by your tolerance for risk. Make sure you have all the relevant facts before deciding.
Thank you for your thoughts.

I guess you are right, owning your own home is more to do with perception/mentality than anything else but never-the-less still feels quite important to me and my wife (particularly after owning back in UK).

I'll be on MA T&C but this is an 'at will' state also so no better off. My reassurance comes from the fact that the company have invested a lot of time and money to bring me over and the interest in keeping me in the US as long as possible is mutual. Furthermore the GC process will be underway by the time we were thinking we'd look to buy which further incentivises the company to keep me around so to get the return on their up-front and ongoing GC investment. Baring a huge downswing in fortunes, I don't see my employment being terminated before the expiration of my L1 visa.

A detailed cost comparison between renting and buying is a good idea and certainly an exercise that I will do. However I also have to undertake a less tangible cost/benefit analysis of how happy we'd be likely to be in rented accommodation over owning and modelling our own home. If the answer is significantly less, I'd perhaps be willing to take a monetary hit from the sales of the US house upon the return to the UK if we'd had 4 amazing years in it.
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Old Apr 24th 2017, 11:10 am
  #41  
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Default Re: Buying a house - anything to be wary of

Originally Posted by jammiie View Post
I'll be on MA T&C but this is an 'at will' state also so no better off. My reassurance comes from the fact that the company have invested a lot of time and money to bring me over and the interest in keeping me in the US as long as possible is mutual. Furthermore the GC process will be underway by the time we were thinking we'd look to buy which further incentivises the company to keep me around so to get the return on their up-front and ongoing GC investment. Baring a huge downswing in fortunes, I don't see my employment being terminated before the expiration of my L1 visa.
Well, that sounds positive, but please be aware that there are significant differences in the job market between the US and UK/EU. To me, it felt insecure vs the UK - it manifested itself in ways such as colleagues keeping quiet, whereas I would be my usual vocal (but constructive!) self with bosses. Locals worried more about being labelled a troublemaker if they raised concerns and/or complained and thus making themselves vulnerable to being fired.

Originally Posted by jammiie View Post
A detailed cost comparison between renting and buying is a good idea and certainly an exercise that I will do. However I also have to undertake a less tangible cost/benefit analysis of how happy we'd be likely to be in rented accommodation over owning and modelling our own home. If the answer is significantly less, I'd perhaps be willing to take a monetary hit from the sales of the US house upon the return to the UK if we'd had 4 amazing years in it.
Enjoyment is a fair point, particularly if you struggle to get a decent rented house in your chosen area. But bear in mind that houses are constructed, heated, wired and plumbed in a completely different manner to UK houses, so again don't underestimate the amount of effort involved in any remodelling/maintenance work as you re-learn everything you think you know. This is a frequent topic for Pulaski so I will let him comment further.
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Old Apr 24th 2017, 11:30 am
  #42  
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Default Re: Buying a house - anything to be wary of

Originally Posted by jammiie View Post
Is there anyone on here that believes that buying a house before having GC in hand can be an acceptable option in the right circumstances?

I'm moving out to Boston from the UK next month and then am relocating down to FL (unsure where yet) in the Autumn. UK house is currently on the market (its the right time to sell regardless of this move) and our plan is to rent in FL initially whilst we find the area we'd like to be in longer term, and then look to buy. I'm on an L1-B visa and my employer will begin the GC process on my behalf in January 2018.

Whilst I understand the risks of buying on a visa and that the GC is by no means a certainty, the way I've looked at it is that if we were to buy in mid-2018, we'd have a solid 4 years in that house secured by the visa. If our GC application was successful then the risk has been worth it, but if the worst was to happen and we had to leave the US at the expiry of the visa then I could sell the house and whilst may not make any money on it, I'd have saved 4 years worth of rent to offset against any losses (if indeed there were any).

Is that logic sound or am I completely mental?

If you have a large pot of money that you can afford to lose...then yes. As mentioned already...realtors fees and legal fees are expensive in the US. If you have to leave the US within a week or so...you will have to pay someone to look after your property, pool, garden. You will also need to run the AC. Who knows how long it will take to sell...could be months and you may have to sell for less than you paid for it.
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Old Apr 24th 2017, 12:26 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by Pulaski View Post
.... This is good advice. I would say the same thing and can't think of anything that I would add.
Actually I did think of something else .... If you don't buy wisely, or are just unlucky, you could find yourself having to pay for a new roof and/or AC system. A roof only typically lasts 15-20 years, and sometimes less, especially if done on the cheap ahead of the owner selling, and an AC system typically only lasts 10-15 years, or even less at the moment as the US switches to a different refrigerant which older AC systems can't use.

You can expect both an AC system and a roof to start around $10,000 for a cheap one for a smaller home, but easily $15k-$20k for a quality product on a typical family home, and even more for a larger home. IIRC someone in Texas reported here on BE a couple of years ago being quoted over $20k to replace each of the two AC systems his home had! His home is large, around 4,000 sqft IIRC, but not a mansion.
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Old Apr 24th 2017, 1:02 pm
  #44  
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Default Re: Buying a house - anything to be wary of

Originally Posted by yellowroom View Post
But bear in mind that houses are constructed, heated, wired and plumbed in a completely different manner to UK houses, so again don't underestimate the amount of effort involved in any remodelling/maintenance work as you re-learn everything you think you know. This is a frequent topic for Pulaski so I will let him comment further.
Originally Posted by Pulaski View Post
Actually I did think of something else ....
You didn't disappoint!
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Old Apr 24th 2017, 1:13 pm
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Default Re: Buying a house - anything to be wary of

My neighbour bought her house whilst on an L1. Her company won't sponsor GC's until getting up to 4 years here, she bought it within a month of arriving in the USA.
However, house values in my area are going up at a fairly high rate, rentals are relatively expensive and decent ones few and far between. She's been with her company over 25 years and moved around the world with them and she's fairly senior in the management structure.

I've also known people at my OH's company who were made redundant and given 2 weeks to leave.

There are so many variables at play when making this house buying decision that all any of us can do is say what we would do in our situation.

I would say look at the worst case scenario, decide if you can cope with it and then have a plan in case it does happen.

This is apparently a good calculator to decide if it's worth it financially to buy
Is It Better to Buy or Rent? - Interactive Graphic - NYTimes.com
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