I’ve always been a renter, and while I was looking for a new place this fall I stumbled upon a property for sale that caught my attention.
Short version
Townhouse
Current owners bought it to flip, became overwhelmed+financial issues are now causing them to sell.
In 2013 the property was appraised at 156K
Current price listed is 89,900
Obviously there are plenty fellow Tnationers that have had experience buying fixer-upers so I’m looking for advice.
My concerns are first, that I’ve never bought a property, and honestly, I know very very little about real estate
Second, that things might not go to plan and I’m stuck with this fixer upper
Third, although I am working I am currently on seasonal lay off, and although I like the company I work for, I do not see myself making a career out of it. Crazier things have happened, so if the opportunity presents itself I could have to get up and move…with a house, I’
What attracts me to the property is that on face it doesn’t need too much work, but, that’s assuming that the Original flippers did quality work (plumbing, electrical, and the like).
To get it move in ready it needs appliances and a bedroom rug…I have a construction background and believe that everything that needs to be done can be done while I am living there.
The price seems right. I don’t think in it’s current condition I would offer 89k but even If I pulled out a 100k mortgage I would be paying basically what rent is around my area anyways.
What I’m really worried about is the timing. I have to sign a lease for a potential apartment on Friday and If I do then I’m in there for a minimum of 6months. I can’t afford rent and a mortgage so I’d have to pass on the opportunity.
Anyways, I’m kinda just looking for advice from anyone in the real estate profession or familiar with buying fix ups. Thanks
I would think to yourself WHY would you want to buy it? I don’t think you have very sound reasons to buy it (ok, it’s a townhouse, not a house)
Houses are great cause you have complete control of what’s going on, this is one of my reasons of why I decided to buy a house. Of course with a house comes a pile of responsibility and paying for shit just to make it “right”, obviously you don’t have to pay for this same shit (directly) when you have an apt. Which can be nice
For me, I wanted to play drums, take care of a yard (reason to be outside on a nice day) and hang my gf without knowing that the person on the other side of the wall would hear (privacy in other words).
It’s nice having your own place, but it is also a continuous pain in the ass, but if I could go back in time, I would still make the decision to buy my first house.
I wouldn’t do it. If you are interested in buying a place, sign your lease, get a realtor and start looking at places. Buying the first place you look at would, IMO, be a big mistake.
When my now-wife and I started looking for our first house, I thought I knew what I wanted. We ended up with a great place that was completely different from what we started looking for. Until you walk through a bunch of them, you really won’t know what you like/want and don’t.
And On Edge is right…leave Max alone. He’s busy and needs to focus.
[quote]Tyler23 wrote:
I wouldn’t do it. If you are interested in buying a place, sign your lease, get a realtor and start looking at places. Buying the first place you look at would, IMO, be a big mistake.
When my now-wife and I started looking for our first house, I thought I knew what I wanted. We ended up with a great place that was completely different from what we started looking for. Until you walk through a bunch of them, you really won’t know what you like/want and don’t.
And On Edge is right…leave Max alone. He’s busy and needs to focus.[/quote]
Thanks for the advice. I’m not looking to buy this place to settle down or anything like that. I’ve always liked townhouses because of the minimal maintenance aspect. This place is a great investment opportunity…that’s the lure
[quote]Tyler23 wrote:
I wouldn’t do it. If you are interested in buying a place, sign your lease, get a realtor and start looking at places. Buying the first place you look at would, IMO, be a big mistake.
When my now-wife and I started looking for our first house, I thought I knew what I wanted. We ended up with a great place that was completely different from what we started looking for. Until you walk through a bunch of them, you really won’t know what you like/want and don’t.
And On Edge is right…leave Max alone. He’s busy and needs to focus.[/quote]
Thanks for the advice. I’m not looking to buy this place to settle down or anything like that. I’ve always liked townhouses because of the minimal maintenance aspect. This place is a great investment opportunity…that’s the lure[/quote]
If there is a possibility of you moving within the next 5-10 years, you’ll lose money on this house. You won’t have paid down any of the principal during your time there and sellers costs, closing fees, etc. will cost you more than the appreciation of the house.
Plus the investors may be selling it because they ran into issues that they’re not disclosing to you (structural issues or whatever).
It was appraised at 156 but what was it bought for last year? That kind of price difference in a year when the markets have all gone up is a red flag unless there is some explanation I’m not aware of.
[quote]Tyler23 wrote:
I wouldn’t do it. If you are interested in buying a place, sign your lease, get a realtor and start looking at places. Buying the first place you look at would, IMO, be a big mistake.
When my now-wife and I started looking for our first house, I thought I knew what I wanted. We ended up with a great place that was completely different from what we started looking for. Until you walk through a bunch of them, you really won’t know what you like/want and don’t.
And On Edge is right…leave Max alone. He’s busy and needs to focus.[/quote]
Thanks for the advice. I’m not looking to buy this place to settle down or anything like that. I’ve always liked townhouses because of the minimal maintenance aspect. This place is a great investment opportunity…that’s the lure[/quote]
If there is a possibility of you moving within the next 5-10 years, you’ll lose money on this house. You won’t have paid down any of the principal during your time there and sellers costs, closing fees, etc. will cost you more than the appreciation of the house.
Plus the investors may be selling it because they ran into issues that they’re not disclosing to you (structural issues or whatever).
[/quote]
So how do people flip houses and make money?
If the house was appraised at 156k in 2013, assuming the market stays similar I don’t see how I’d be losing money.
[quote]sufiandy wrote:
It was appraised at 156 but what was it bought for last year? That kind of price difference in a year when the markets have all gone up is a red flag unless there is some explanation I’m not aware of.[/quote]
I don’t know. I’m not sure if it was bought when it was appraised. I assume so, but I couldn’t find any history of the sale. Asked the realtor she didn’t know and said she would get back to me.
[quote]carbiduis wrote:
For me, I wanted to play drums, take care of a yard (reason to be outside on a nice day) and hang my gf without knowing that the person on the other side of the wall would hear (privacy in other words).
[/quote]
Be advised about the HOA, and what it covers. Also understand it will go up over time.
Consider what amenities there are and if it’s worth the money you will be paying. My HOA is $540/month and all I have are some pools and tennis courts (which I have not used even once).
Think about the stuff you like to do (cooking, entertaining, barbequing in a back patio area, etc) and how this property fits those needs. For example, If you like to cook, and the kitchen is cramped or sucks, it might not be the best fit for you. If you have lots of people over and the living room area is small, again could be a problem.
Noise concerns can be address with spray foam, Quiet Rock, or both. Or just not give a flying shit about the noise.
Yeah, the HOA fees can be steep. But for $89k with a decent down payment you can have some instant equity in the place. Take a short term look at it, buy it, fix up the cosmetics and get appliances. Look to get out in 3-5 years. By then you’ll have more equity in the place especially if it can be sold at the current market value. The potential to walk away with some real cash to get the place you really want is attractive.
[quote]carbiduis wrote:
For me, I wanted to play drums, take care of a yard (reason to be outside on a nice day) and hang my gf without knowing that the person on the other side of the wall would hear (privacy in other words).
[/quote]
Good call, I’d want some privacy for that too.[/quote]
[quote]Testy1 wrote:
Put your address in Zillow and see if anything else around you is selling and for how much. Townhouses and condos are generally losing propositions.[/quote]
They are tough to unload if the market is bad at the time. The best way is to get in as cheaply as possible and minimize what you put into it.
Comps in the area and how long they’ve been on the market are good indicators of the selling market for that development. Some developments sell poorly compared to others.
For me, I wanted to play drums, take care of a yard (reason to be outside on a nice day) and hang my gf without knowing that the person on the other side of the wall would hear (privacy in other words).
.[/quote]
If you make her unconscious somehow before hanging her there shouldn’t be too much noise. Disposing of the body discreetly is another issue altogether. Perhaps a meat grinder? You could always just break up with her I suppose.
[quote]Testy1 wrote:
Put your address in Zillow and see if anything else around you is selling and for how much. Townhouses and condos are generally losing propositions.[/quote]
They are tough to unload if the market is bad at the time. The best way is to get in as cheaply as possible and minimize what you put into it.
Comps in the area and how long they’ve been on the market are good indicators of the selling market for that development. Some developments sell poorly compared to others.[/quote]
I know people have made money off of them but they don’t usually appreciate like a house.
[quote]Testy1 wrote:
Put your address in Zillow and see if anything else around you is selling and for how much. Townhouses and condos are generally losing propositions.[/quote]
They are tough to unload if the market is bad at the time. The best way is to get in as cheaply as possible and minimize what you put into it.
Comps in the area and how long they’ve been on the market are good indicators of the selling market for that development. Some developments sell poorly compared to others.[/quote]
I know people have made money off of them but they don’t usually appreciate like a house.
[/quote]
When traditional housing is at a peak, co-ops and condos are often a more affordable option. My brother got into one in 1986 when local housing was astronomical and condos weren’t much better. Then the bottom fell out of the condo market and what was a $110K unit became a $48K unit in a few years. The prices are now around $165K, definitely has not appreciated as much as a house.
[quote]Phoenix44e wrote:
If the house was appraised at 156k in 2013, assuming the market stays similar I don’t see how I’d be losing money.
[/quote]
Ignore the appraisal, it’s meaningless.
If the place is on the market for $89k, then it’s worth something less than $89k. That is the current market value and the only number you should be paying attention to.
The only equity you will have in it the day you close is whatever you put down.
[quote]Phoenix44e wrote:
If the house was appraised at 156k in 2013, assuming the market stays similar I don’t see how I’d be losing money.
[/quote]
Ignore the appraisal, it’s meaningless.
If the place is on the market for $89k, then it’s worth something less than $89k. That is the current market value and the only number you should be paying attention to.
The only equity you will have in it the day you close is whatever you put down.
[/quote]
Who the fuck wants to buy an apartment?