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Dik Hz posted:The prime rate dropped steadily through all of 2008, and has held steady all of 2009. They did drop below 5 though in early 2009 though, which is a psychological trigger for people. But I agree, it can't really be proven either way. And I was just basing those feelings solely on the first strong performance of the stock market since late 2008, as well as sales volumes of existing homes remaining steady and the average sale price at least declining slower than in previous months.
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Jul 8, 2009 03:06
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Strict 9 posted:They did drop below 5 though in early 2009 though, which is a psychological trigger for people. You're overthinking this. Home prices are still above their pre-bubble prices, the economy is in the shitter, and the fundamentals still suck. The only good things going are low interest rates and the $8K credit. The graph shows a sharp immediately turnaround that corresponds exactly with the $8K credit, and doesn't appear to correlate directly with interest rates. For similar reasons, I don't think its consumer confidence. Consumer confidence is only just now turning around.
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Jul 8, 2009 04:15
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Rikes posted:From what I have looked at: I came to post exactly this. Wow, you must be looking in the Chicagoland area too? There are more townhomes in my price range than single family homes, and on top of that, the townhomes are generally cheaper, in better condition, and in nicer areas. So, my question to Fidgety Rat would be - who would look at a SFH over a townhome unless you are looking at homes greater than $200,000?? The Shep fucked around with this message at 07:11 on Jul 8, 2009 |
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Jul 8, 2009 07:08
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On another note, interesting report from PMI Group released today (here) that also shows home prices to continue falling through 2011. Unfortunately my area, Boston, is about a 50/50 chance to fall, at least according to this report. So frustrating. There's just so many conflicting reasons for and against buying a house in this area this summer / fall, it's driving me insane. I suppose it's good in a way that we haven't seen more than one decent house yet. All we see are houses for $230/sq foot that were last updated in 1960, or we see split levels and their terrible layout, or houses from the 1600's where the living rooms are all 16x12. Hell, I don't think we've seen a single house with a living room bigger than 17x12. I should really stop torturing myself by watching House Hunters too. Last night there was a couple in Houston and ALL the guy cared about was the grill. They ended up choosing a house with no yard (which the wife wanted of course) but a 50 square foot alley where he could fit his grill, and the kitchen had a counter "perfect for margaritas". They didn't choose the other house because they didn't like the chandeliers in the living room. 
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Jul 8, 2009 13:17
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Cmdr. Shepard posted:There are more townhomes in my price range than single family homes, and on top of that, the townhomes are generally cheaper, in better condition, and in nicer areas. So, my question to Fidgety Rat would be - who would look at a SFH over a townhome unless you are looking at homes greater than $200,000?? I agree. I wasn't considering areas outside my own. Condos/Townhomes around my area cost over 200k for absolutely no reason. A SFH can cost just as much if not slightly more and bring with it property, privacy, and more sq. ft. Now I just need to figure out why they are so expensive around here... Thanks for the input. swenblack posted:Furthermore, you have demonstrated a clear inability to distinguish your individual market conditions from nationwide trends. Yet you still try to talk as someone informed on those same macro trends. Please stop. I'll agree with you that I was not seeing the entire picture and focusing on my own market which is going up instead of down, I still fail to see why some people can call for hard evidence about the 8k stimulus affecting homes, but will take historical data as fact whether it be likely or not. But that argument could go on for pages. FidgetyRat fucked around with this message at 13:25 on Jul 8, 2009 |
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Jul 8, 2009 13:20
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Cmdr. Shepard posted:I came to post exactly this. Wow, you must be looking in the Chicagoland area too? Ha, nope. I'm searching in the Northern Colorado area. I'd imagine that while the prices may be different, the general trends hold true across markets (except in the cases Fidgety Rat pointed out). Strict 9 posted:I should really stop torturing myself by watching House Hunters too. Last night there was a couple in Houston and ALL the guy cared about was the grill. They ended up choosing a house with no yard (which the wife wanted of course) but a 50 square foot alley where he could fit his grill, and the kitchen had a counter "perfect for margaritas". They didn't choose the other house because they didn't like the chandeliers in the living room. That show and Property Virgins are absolutely awful. I don't know where they find such uninformed buyers to throw on TV. And the realtors... jeez. It's the same host/realtor each episode, but each episode is in a different city and state so I'm not sure how they can give any advice about the local area and market. If my realtor was that uninformed I'd dropped him months ago. Maybe they take care of all the 'boring' parts behind the scenes. The best one I saw was the pair of frat brahs who wanted a "wicked party house" and a place for "beer pong and the ladies". How they had $250,000 to spend was beyond me.
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Jul 8, 2009 15:28
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Rikes posted:That show and Property Virgins are absolutely awful. I love shows on HGTV. My fiancée and I love to go though places and say "wow, that bathroom doesn't have a 50" TV.." and make that "blooooohhhh" noise the shows use to represent home values dropping. Seriously, they will cover a room's wall with cardboard in one show, and then berate someone for their choice in bedspread color in another.
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Jul 8, 2009 15:33
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I want to punch an old guy in the dick. House in Dormont PA with asking price of 142,900. Assessed valued at 80,000 (Granted, it's PA. It's low.) House has been on the market since last June. This is it's second listing and it expired last week. TONS of work needs done. Electrical needs to not be a fire hazard, plaster water damage in four rooms, wall paper needs ripped out, rugs need ripped out, wood needs refinished, dropped tile poo poo ceilings ripped out, garage ceiling falling down... Granted, everything is cosmetic accept the electrical. But this is a fix-it-upper. We put a bid in for 115,000. We don't expect him to fix poo poo. In fact, he's destroyed more than he's repaired in that house. The addition in the kitchen has a floor that dips in the middle. He puts forth a counter offer : 140,900. You got to be loving kidding me. Can you even GET a mortgage for that much on a house that might... MIGHT appraise for 110k? Assuming you don't put 30,000 in cash to cover it. From what the Realtor tells me he's sick of dealing with his agent and wants to rent the place out. He bought a house for 180k last year and is stuck with paying 500$ a month in upkeep costs. Yes, he's going to rent out a house where an electrical wire has been spliced without a break out box and is hidden behind a baseboard.
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Jul 8, 2009 19:39
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It's a delusional seller, you are probably going to have to walk away. The house I ended up buying had minor problems, but a ton of deferred maintenance popped up after the inspection (needs all new windows, A/C, no GFI outlets among others agggh) so we said we needed a $5000 reduction to cover necessary repairs. They came back with $500. We made a final offer of $3500 and they rejected it outright, $500. We walked away and they retracted their rejection. Are you a GC or is this house sitting on an oil well? Cosmetic damage is very expensive to fix, and can cover up deeper issues. Why do you want a house that needs so much immediate work?
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Jul 8, 2009 21:19
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ChuckMaster posted:I want to punch an old guy in the dick.
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Jul 8, 2009 21:55
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Vaporware posted:It's a delusional seller, you are probably going to have to walk away. The house I ended up buying had minor problems, but a ton of deferred maintenance popped up after the inspection (needs all new windows, A/C, no GFI outlets among others agggh) so we said we needed a $5000 reduction to cover necessary repairs. They came back with $500. We made a final offer of $3500 and they rejected it outright, $500. We walked away and they retracted their rejection. It's an old style house that would look fantastic once all the repairs are made. Even with the current damage, it's still pretty drat awesome. Four decorative fireplaces, wood paneled entryway and dining room... Most of the trouble is being hidden by the poo poo drop ceilings. We had a contractor give the place a look over. 6k would go a long way to fix the worst of it, assuming his estimates are accurate. After that we'd fix up a room a year. And it's loving huge. I'm expecting to walk away from this one. I'm comforting myself in the fact that they don't have any paper work for the roof they installed in 2001, and they probably had it done by their cousin Billy-Bo-Bob DickButt. Dik Hz posted:Its like dating. Don't get fixated on any one house. You might also try a neg/neg/kino maneuver. What's a neg/neg/kino maneuver? Sounds dirty.
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Jul 8, 2009 22:21
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ChuckMaster posted:What's a neg/neg/kino maneuver? Sounds dirty. I don't know. I just threw together some pick-up artist catchphrases, because I was giving dating advice.
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Jul 8, 2009 22:49
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Why would you want to pay a penny more than its appraised value no matter how nice you think it is?
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Jul 9, 2009 00:40
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geetee posted:Why would you want to pay a penny more than its appraised value no matter how nice you think it is? We didn't get an appraisal, that was the Allegheny county assessment. They're notoriously low. Anyway, dude wanted to settle in the 130's. So we told them the deal's off.
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Jul 9, 2009 02:24
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ChuckMaster posted:We didn't get an appraisal, that was the Allegheny county assessment. They're notoriously low. Ahh, I see. Well as was already said, don't get hung up over lovely sellers. I recently purchased and I'm glad first the two offers I made on other places were kicked back. Ended up finding a nicer place for less money.
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Jul 9, 2009 03:10
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Until there's a signed agreement, you're not a buyer and he's not a seller. You're two people who would be interested in making a transaction at the right price. For some people, the right price just isn't going to come right now, but their circumstances are such that they feel like they have to explore it anyway. Don't get too bent out of shape about it. We had a house with the same exact problem: we loved the house, and offered a reasonable price on it, and the guy wasn't interested. We ended up finding another house that we liked even more for way less than we offered on the first one, literally down the street on the same block. It's a tedious and time-consuming process, but I promise you, if you're willing to entertain doing fix-ups, then you're already committed to way more work than sifting through a few unenthusiastic would-be sellers will pose.
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Jul 9, 2009 06:53
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Wuhao posted:It's a tedious and time-consuming process, but I promise you, if you're willing to entertain doing fix-ups, then you're already committed to way more work than sifting through a few unenthusiastic would-be sellers will pose.
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Jul 9, 2009 13:44
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Great thread. I didn't see this topic being discussed yet, so thought I put it forth. I want to buy a house from some family friends. The house isn't on the market yet. Like most of the country, the housing market is oversaturated and are tough to sell. Their place is perfect for me and in a very affordable neighborhood. This will be my first house. I've just started to learn about the home buying process, but have not yet come across anything about buying directly from an owner. Are there any pitfalls unique to this arrangement that I have to look out for? I trust the owners, so I'm not worried about getting hosed. I assume there is substantial savings to be had provided that both parties do not have to hire realtors? Am I wrong? The owner is planning to put their house on the market next year. I'm trying to become more knowledgeable about this before I formally sit down with the owners and talk about buying their house.
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Jul 9, 2009 20:43
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Black Jasper posted:Are there any pitfalls unique to this arrangement that I have to look out for? I trust the owners, so I'm not worried about getting hosed.
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Jul 10, 2009 02:06
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I am in the middle of negotiations on a house that was listed for $79.9k. I have been preapproved for a FHA mortgage. I offered $80k against two other bidders and won, the property is a short sale and upon being told that I had the highest bid I was also told the following: 1. It somehow has a second mortgage (and thus a lien)against it that no one knew about. Currently the primary mortgage company that's selling it is discussing how to chop up the $80k with the secondary one, but that's going to delay closing a week or so. No big deal assuming that they come to an agreement, and according to my realtor they do in over 80% of the cases she's dealt with. 2. The house has a pool. The house sits at the top of an incline (level) but the pool area had to be built up and leveled before the pool was installed. The bulkheading that was installed to confine the debris and sand used to build the area looks nice but was not done smart, and because of this parts of the concrete slab surrounding the pool area have busted. The pool works, mind you - the slab is busted and I'm going to have to come in with real bulkheading, landscaping, and I'm going to have to repour and level the concrete. Probably a $1000 job and a full week of work. Since this is FHA, apparently this needs to be fixed before they'll proceed with the mortgage. Other than walking away, what options do I have? Should I go traditional mortgage, borrow into the equity, and just fix it that way without having to rush into repairs before even being able getting the FHA one? If your home appraises for over 80% of the loan value, do you even have to put down 10%-20% these days? It's been so long since I've looked at these things I'm not sure....
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Jul 10, 2009 02:59
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Black Jasper posted:Great thread. I guess I'd caution you to remember that you do not want to buy a house from friends; you want to buy a house, and that house happens to be owned by friends. While I hope that your friendship is genuine enough that no one will try anything underhanded, business has to be treated like business and there is no room here for either of you to relax on the sale any more than you would with complete strangers. If either of you start trying to do the other side any favors, then not only will at least one of you get hosed over, but you'll probably also lose your friendship. So, do your homework and look at lots of other houses, just like you would if this weren't owned by friends. Find at least a couple more that you would consider buying, and start comparing them. Understand why you'd pay a higher price for one over the other. Also, make sure you REALLY know all about everything that goes into buying a house, from writing and submitting a purchase offer, getting a signed agreement, opening escrow, getting your inspections done, how you can back out if things go wrong, what needs to be done for the house before you take possession, and so forth, because you're going to be responsible for all of that and you don't have an agent to lean on for help. On the other hand, while there are some fantastic realtors out there, the realty world is filled with incompetent gently caress-ups, so you really can't ever learn too much about how to do this on your own.
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Jul 10, 2009 03:07
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peengers posted:Other than walking away, what options do I have? Should I go traditional mortgage, borrow into the equity, and just fix it that way without having to rush into repairs before even being able getting the FHA one? While I'm certainly no expert here - why can't you just put 20% down and go traditional? That way you won't have to meet any FHA inspection standards and can fix the stuff at your leisure.
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Jul 10, 2009 06:09
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Cmdr. Shepard posted:While I'm certainly no expert here - why can't you just put 20% down and go traditional? That way you won't have to meet any FHA inspection standards and can fix the stuff at your leisure. At this rate I'm probably going to do that.
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Jul 10, 2009 13:58
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peengers posted:Other than walking away, what options do I have? Should I go traditional mortgage, borrow into the equity, and just fix it that way without having to rush into repairs before even being able getting the FHA one? If your home appraises for over 80% of the loan value, do you even have to put down 10%-20% these days? It's been so long since I've looked at these things I'm not sure.... I assume you were going with a FHA loan over a conventional one because it was a lower rate? How much were you putting down? From what it sounds like, you were putting a bit down. FHA: - Minimum 3.5% down - Can request up to 6% towards closing costs (don't know how this works with short sales) - Mortgage insurance is required for a minimum of 5 years. It's like PMI for a conventional mortgage, but it's about half for whatever reason. I'm assuming this doesn't apply if you're putting 20% down, though. Conventional: - Minimum 5% down (at least around here) - Can request up to 3% seller assist for closing costs - PMI up until 20% equity, no "minimum" time period. It is much more expensive, though. We went with Conventional even though the rate was a little higher because I didn't like the minimum 5 year mortgage insurance term. I like to pay stuff off and I'm hoping to get to 20% before five years. Also, there was some minor stuff at the house that would have needed finished before closing and it just seemed like a hassle to have to hurry up and get it done. Assuming you have 5% down and enough for closing costs, just go conventional. The rate isn't going to matter that much, since you're apparently pretty good at saving money pay $100 or so extra on the mortgage and you'll do way better than a quarter point of interest. Also, if you're good at saving money you'll have that $1000 to fix the pool in no time.
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Jul 10, 2009 18:41
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Sounds like you just got lucky on your FHA because they are generally higher then conventional.bankrate.com posted:You need to shop rates when looking for a FHA mortgage just as you would with a conventional loan because the rates are established by the lender, not the government. FHA loan rates are typically higher than conventional (nongovernment guaranteed) loan rates but shouldn't be a lot higher unless you have credit problems.
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Jul 11, 2009 14:19
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The fha stuff I've read says that the only thing that matters with regards to pools is a) fenced in, b) holds water, and c) pump works. The damage is cosmetic, so I'm going to just wait and see what the fha appraiser says. And my realtor is a retard.
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Jul 12, 2009 01:16
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peengers posted:And my realtor is a retard. Everyone in real estate is retarded, top to bottom. 
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Jul 12, 2009 03:46
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FidgetyRat posted:Sounds like you just got lucky on your FHA because they are generally higher then conventional. Well, again this was a month or so ago when all this rate craziness was happening, but both lenders I met with FHA had a better rate at the time (which I thought was not the norm). I close in 49 hours. Holy crap.
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Jul 13, 2009 18:35
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dreesemonkey posted:I close in 49 hours. Holy crap. Me too! We signed paperwork this morning, and get the keys when the title registration has taken place on Wednesday.
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Jul 13, 2009 18:49
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Still waiting on seeing how these two mortgage companies are going to split up my offer. My highest, winning offer. Unless one of them decides to counter offer, in which I'll probably tell them to gently caress off and have fun being back on the market for yet another year with no takers.
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Jul 15, 2009 04:11
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I have a semi-stupid question so please bare with me: I am on the verge of getting out of student loan debt and I really need a new car. As a gift to myself for working very hard and paying off my loans actively within 2 years of graduating (saving and sacrificing everything) and making an annual income of 86K, I would like to by myself a nice car. I am looking to spend about 38 - 40k on a new car however, everyone I talk to states I should apply for a mortgage before I buy the car because it will lower what a qualify for. Although I don't disagree with this statement, I would just like to know why is works like this if my car payments would only be about $500 a month? People obtain good mortgages with 38K in student debt, would it be much different?
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Jul 15, 2009 04:58
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Ophelia's Ashes posted:I have a semi-stupid question so please bare with me: I can completely relate with having a large monthly income and having virtually no debt, but I would really recommend not spending that much money on a car. You can buy a lot of really nice cars for 12k less, especially if they're a year old. I don't have any mortgage advice, but I suggest you not buy a car that expensive.
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Jul 15, 2009 05:33
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Ophelia's Ashes posted:I have a semi-stupid question so please bare with me: We probably can't convince you to NOT buy a $40,000 car (although you really shouldn't), so here is my take. I'm not a loan officer: Realistically, no, an additional $500 a month expense to someone making $7200 a month really shouldn't matter. But from a bank's point of view, you are incurring another liability, so they will ding you for it. Any risk you expose yourself to is a bad thing in their mind. And rightfully so. So they'll take a little extra month to pad themselves, and more importantly, they'll do it just because they have reason to make more money off you. I'd be interested to see what the difference in your rate is if you took out this loan versus if you didn't. I'd throw a guess out at 30 basis points at best. magic_toaster fucked around with this message at 07:56 on Jul 15, 2009 |
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Jul 15, 2009 07:53
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If you are serious about buying a house in the next year, I wouldn't finance a new car.. If you are just *thinking* about it, then don't hold up your life on a possibility of buying a home. Also agreeing with the other guys.. Call me cheap, but I'd never pay over 20k for a car. There are always sales on reasonable vehicles.. I got a brand new mustang fully loaded for 15k when the new models came out since they wanted to be rid of the *old* '04 style.
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Jul 15, 2009 13:27
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FHA and pools question: A home I am looking at has an above ground pool(which I plan to remove!). The pool is currently empty. Would this cause me to be denied completely for an FHA loan because the pool is not full of water?
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Jul 15, 2009 14:35
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Ophelia's Ashes posted:I have a semi-stupid question so please bare with me: Great job getting your student loans paid off, I know what you mean about "sacrifice" for the greater good. I can understand wanting a nice car (my car, my wife's car, and my truck combined are worth less than my motorcycle, which is probably only worth $5500), but you're just getting out of debt for another $40k for the worst "investment" asset you can own? Unless you're buying a highly desirable collectors car (which you're not, for $40k) the value is going to do nothing but tank, especially in this economy. I'm not saying that you don't deserve a nicer car, but it's a pretty terrible financial decision. At least let someone take the initial depreciation hit for you. As for the car's specific effect on a possible mortgage, I think the rates are based primarily on your credit score (they go with the middle score from the "big three), and they just confirm your debt to income ratio isn't out of hand. But I'm not 100% sure.
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Jul 15, 2009 15:03
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Ophelia's Ashes posted:I have a semi-stupid question so please bare with me: I'm wary of financing things like vehicles, because it becomes very easy to say "Sure, I'd pay $500 a month for that" but if you have $40k in the bank that will be gone in two seconds, you might rethink your priorities (home renovations will become a big one!) If you really want a new $40k car, okay - but give yourself a safety net in case things go wrong and you lose that great job. Where are you getting the down payment for the house? As another aside, will the interest rate for your car be less than your student loan rate? If not, isn't that essentially just trading $40k of debt into a higher rate?
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Jul 15, 2009 16:59
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Ophelia's Ashes posted:I am looking to spend about 38 - 40k on a new car however, everyone I talk to states I should apply for a mortgage before I buy the car because it will lower what a qualify for. Although I find it hard to believe you are really ready to drop almost 50% of your income on a new car, I'll just jump on the bandwagon and say please do not spend that kind of cash on a car. If I was making the poo poo ton of cash you are, I'd be worried about being the next on the chopping block as companies lay off workers. I know it's already been covered to an extent, but every additional debt obligation you have lowers the amount of money you can put toward a mortgage. If you go to get pre-qualified for a home loan, they will look at all your monthly payments and debt obligations, fortunately it looks like you don't have much, but I'd see a mortgage lender first and see what they'd give you now versus if you had a $500 a month car payment (which will also need to include insurance, fuel, and maintenance). I think in most cases they will still only lend you what you can pay with 1/3 your gross income, so you might be ok either way.
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Jul 15, 2009 21:08
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Thanks so much for the really great advice guys, definately something I'm taking to heart. As for the housing situation: Combined my fiance and I make $111,200.00 before taxes. We have $32,000 for a downpayment - a certain amount was given to us by our parents for a wedding, but we decided to go cheap and spend the majority of it on a downpayment for a house and this, combined with a $15,000 line of credit we have taken out creates the $32,000 downpayment. We will have that downpayment to pay off as well which is something to factor in when I look to purchase a car. I'm thinking we will probably put $1000 ($500/each) towards it a month which will increase my debt payments to $1500 a month. My student loan interest was 8% a month as opposed to a car which would run me 1.9 - 2.5% a month. Edit: I just want to state that I work in EMS and we are actually understaffed in my Province, so the chances of me being laid off are slim.
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Jul 15, 2009 21:16
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Unless you are putting a significant amount down on that 40K car, your payments will be 750+ on a 5 year loan.
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Jul 15, 2009 22:14
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