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Buying a house - anything to be wary of

Buying a house - anything to be wary of

Old Apr 24th 2017, 1:56 pm
  #46  
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Default Re: Buying a house - anything to be wary of

Originally Posted by petitefrancaise View Post
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
this needs to be bookmarked for the next time this topic comes up, it is very comprehensive!
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Old Apr 24th 2017, 2:49 pm
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Default Re: Buying a house - anything to be wary of

We bought a home within weeks of arriving on an H1-B in 2003. If I'd known then what I know now, I wouldn't.

I moved to Alabama to support a medium size regional bank and was able to get a mortgage through that bank (I discovered later, it was co-signed by the bank's president). 2 years later, the bank changed hands and another year after that, the support contract was terminated.
While I was offered an opportunity to move to Florida, I didn't want to. Partly due to us being settled, partly due to having to sell the house but mainly due to the company being crap.
Luckily, I was able to find another company willing to take on the H1-B and Green Card process. Six months later, that company changed hands. I was fortunate (again) that the new owners picked up the H1-B and proceeded with the Green Card.
Seven years later, we finally got green cards but literally weeks before our daughter was due to 'age-out'. That would probably have resulted in us selling up and moving back to Blighty.
Another year later, I was offered a job in Florida and moved but lost my shirt on the previous house due to the crash and general shenanigans of 2008.

So, while it all worked out in the end, it's been one hell of a rollercoaster ride for more than 10 years.
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Old Apr 24th 2017, 3:27 pm
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Default Re: Buying a house - anything to be wary of

Something else to think about, house prices may be peaking soon in some areas. Houses around here have been going up 10% to 15% per year for last 5 to 6 years. The house we bought in 2011 is more than double what we paid for it.

On the other side, rents are going up 10% per year sometimes more. I live in an area that has had a high influx of people over the recent years.
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Old Apr 24th 2017, 3:32 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by Pulaski View Post
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.

That's a good point about refrigerant. I would not buy a house that had A R22 unit unless some price reduction
was part of the deal. R22 is hard to find and very expensive. Roofs are more predictable and a visual inspection by someone who knows what he is doing can give a fairly accurate estimate of years of service left.
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Old Apr 24th 2017, 4:49 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by ddsrph View Post
That's a good point about refrigerant. I would not buy a house that had A R22 unit unless some price reduction
was part of the deal. R22 is hard to find and very expensive. Roofs are more predictable and a visual inspection by someone who knows what he is doing can give a fairly accurate estimate of years of service left.
Do you know when they switched from R22 to R134a in cars?
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Old Apr 24th 2017, 4:59 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by mrken30 View Post
Do you know when they switched from R22 to R134a in cars?
R22 is not used in cars. R12 was used until 1995 then R134.
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Old Apr 24th 2017, 11:26 pm
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Default Re: Buying a house - anything to be wary of

Good luck with whatever you decide. Buying a house here seems to be much more expensive than buying one in the UK and more stressful too! We put an offer in on our first house here yesterday and are in some sort if bidding war nightmare right now and we are at the point of saying sod it and waiting for another house....but sadly we really like this one UGH!
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Old Apr 24th 2017, 11:54 pm
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Default Re: Buying a house - anything to be wary of

As far as I know there are no States that allow gazumping like in the UK. I lost several thousand pounds, time and effort in the UK due to gazumping.
Buying a house in the US is a little less stressful in that respect. Tenant rights in the UK are a little more strict than in the US.
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Old Apr 24th 2017, 11:57 pm
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Default Re: Buying a house - anything to be wary of

Originally Posted by Wibblypig View Post
Good luck with whatever you decide. Buying a house here seems to be much more expensive than buying one in the UK and more stressful too! We put an offer in on our first house here yesterday and are in some sort if bidding war nightmare right now and we are at the point of saying sod it and waiting for another house....but sadly we really like this one UGH!
Ouch. Sounds horrible. Have had that at home (lost out). Also been gazumped once after shelling out on survey. It's such an emotional process presuming it's a home and not a hard investment. Definitely stressful. Do you have anything to sell? If not, doesn't that give you an advantage over others? Good luck anyway.

I shared all info with hubby. Fair to say he's not loving the feedback and I relate completely to the POV that there are intangibles like happiness involved too. We're not trying to make a fast buck but I'd hate to move home in a hurry with a mortgage here to fund. So I get ultimately it's about appetite for risk. Also the costs and ongoing maintenance issues have opened my eyes. If nothing else, this is a kick up the ass to chase GC application. Would feel somewhat happier with that

On costs, when buying, how many successfully get seller to pay a proportion? Or ultimately does that exacerbate an expensive system and just pass costs on to inflated asking prices?
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Old Apr 25th 2017, 12:13 am
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Default Re: Buying a house - anything to be wary of

Originally Posted by Chesten View Post
.... On costs, when buying, how many successfully get seller to pay a proportion? Or ultimately does that exacerbate an expensive system and just pass costs on to inflated asking prices?
The seller already pays most of the costs - like all the 6% realtors' fee. Across much of the US the housing market is currently fairly tight and most sales are at, close to, and surprisingly often above the asking price, so don't expect much in the way of additional concessions by the seller unless the house has been difficult to sell, in which case, ask yourself "Why?"
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Old Apr 25th 2017, 12:41 am
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Default Re: Buying a house - anything to be wary of

Originally Posted by mrken30 View Post
As far as I know there are no States that allow gazumping like in the UK. I lost several thousand pounds, time and effort in the UK due to gazumping.
Buying a house in the US is a little less stressful in that respect. Tenant rights in the UK are a little more strict than in the US.
The English system of there being no legal commitment to buy or sell until relatively late in the game leaves it wide open to abuses such as gazumping and "chains" of sales falling apart if one transaction does. I never cease to be amazed that the system hasn't been reformed. Although costs are too high in the US system, the basic tenets of an early binding contract with well-defined and time-limited contingencies is so much more preferable to both buyers and sellers.

Last edited by Giantaxe; Apr 25th 2017 at 1:13 am.
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Old Apr 25th 2017, 1:18 am
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Default Re: Buying a house - anything to be wary of

One thing I realised is that, unless you know the realtor well, even though you are expected to use a realtor to help you buy a house, they will still be paid by the seller. Our realtor will get half the fee being charged to the seller. So they still have an incentive to get the best price for the house, even though they don't work directly for the seller. If our realtor had had her way, we would have offered way more than we did. I suppose the only way round that is for you as the buyer to pay the realtor direct, but I certainly wasn't going to do that!

And whereas it is true that a contract is in place early here, there are still ways to get out of it, like if the house isn't worth to the bank what you offered or if the house fails inspection. I suppose either side could break the contract for no valid reason if they wanted, but of course there would then be financial and legal consequences.

I think moving house both here and back in UK is expensive, but some things for me made it better for us to buy now than continue renting. Where we live, monthly rental is more expensive than the mortgage on an equivalent house. Also we plan to stay put for quite awhile, so we won't be paying moving costs too often. That was an important consideration for us, as we have no control over the landlord putting up the rent whenever he wanted and we have ended up paying the increase because of the cost of moving.
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Old Apr 25th 2017, 1:27 am
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Default Re: Buying a house - anything to be wary of

Originally Posted by becks_r View Post
And whereas it is true that a contract is in place early here, there are still ways to get out of it, like if the house isn't worth to the bank what you offered or if the house fails inspection. I suppose either side could break the contract for no valid reason if they wanted, but of course there would then be financial and legal consequences.
When I bought my current place, the sellers couldn't close the sale by the date specified in the contract, and ended up paying me daily "damages" until they could. Similarly, one place I sold, the buyer couldn't close on time and had to pay my carrying costs on the property until they did close. In fact, I could simply have walked away with their 5% (or whatever it was they put into escrow when I accepted their offer) and put the property back on the market. There's definitely an incentive to abide by the contract!
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Old Apr 25th 2017, 1:30 am
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Default Re: Buying a house - anything to be wary of

Originally Posted by becks_r View Post
One thing I realised is that, unless you know the realtor well, even though you are expected to use a realtor to help you buy a house, they will still be paid by the seller. Our realtor will get half the fee being charged to the seller. ....
Not quite. The (typically) 6% fee gets split four ways equally in most cases, with the buyer's and seller's agents each getting 1.5%, and the agency they each work for, aka "the brokers", getting the other 1.5% each. Obviously a self-employed realtor gets 3%, being 2× 1.5%.
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Old Apr 25th 2017, 1:43 am
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Default Re: Buying a house - anything to be wary of

Originally Posted by jammiie View Post
...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?
We're not in the priciest of rental areas in Florida but your logic, if applied to our rental situation, would equate to $80,160 (+ professional carpet and deep cleaning costs, as per contract, upon our exit, so lets say at least $82k)...

EDIT: Not to mention that the robbing barstewards would have added another two years ball busting rent increases if we were to stay another two years!! Which we won't be, offer accepted yesterday subject to buyers action re septic tank issue that previous hopeful's inspection revealed (first timer who withdrew because the dreamy secluded rural property was ... wait for it.... 'going to be too much like living in the country'. WTF, who bids on a rural property expecting it to sit in the shadows of Walmart/CVS/Dollar General/HOA's et al?????)

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