mattisr1984 Posted May 8, 2012 Share Posted May 8, 2012 yeah, you can. but chances are it will be a property that needs a LOT of work. investors buy them, fix them up and rent them. for example: http://www.zillow.com/homedetails/2806-W-Latham-St-Phoenix-AZ-85009/7513339_zpid/ i say keep the tagging in the bedroom, what do you think? it adds a unique charm. or this place, which apparently the listing agent wont even walk into: http://www.zillow.com/homedetails/1561-W-Peoria-Ave-Phoenix-AZ-85029/7782094_zpid/ They honestly blow my mind, that first one especially. While being slightly crackden like, over here would still sell for maybe $150k in my town. And with a new roof, paint, any kind of lawn/garden work and a bit of new drywall would go for upwards of 200k. What kind of cesspools do you guys live in haha or is America really that far gone as a whole? no, go about 15 miles east of that first house and you will see million dollar homes. there are just some areas, like in most states, that i would never, ever consider owning a house no matter how good of a buy it might be. so while 20k - 30k houses do exist, they are going to be in shitty condition and/or really bad neighborhoods. if youre okay with living out in the middle of nowhere (ie. 45 - 60 min away from where you are likely to work / play), you could probably get a brand new house starting around 80k. Quote Link to comment Share on other sites More sharing options...
deadreckoning Posted May 8, 2012 Share Posted May 8, 2012 You shouldn't have to worry about the real estate agent's commission as a buyer. That should be paid by the seller. You may be able to negotiate the percentage and flat fees. That may be easier with someone who doesn't work in a bigger company (Long and Foster, etc.). Also be a bit wary if both agent's work out of the same office. Your fixed costs are mostly your closing costs and they are going to vary from county to county. These will include home inspection, home owner's insurance, title insurance, survey, termite inspection, flood certificate, transfer and recordation taxes, etc. Also, if you don't put 20% down (which you probably can) you'll have to pay for PMI. One one the bigger factors of total closing costs is where in the tax year you close. If it's earlier in the tax year you'll have to put more upfront into escrow. Another factor is whether are not closing assistance is common in your area. Some buyers expect 3% (6% is usually the max) from the seller at closing to help defer the cost. When i bought my house last year the closing costs where nearly 12K, but they can be much less depending on your area. Unless you cleared over 250K you most likely are not going to have to pay capital gains taxes on the sale of your residence. I am not sure how that may vary state to state, but as of the mid 90's that is the federal rule. Also, without a mortgage you wont get the tax break from the interest. Quote Link to comment Share on other sites More sharing options...
jase Posted May 8, 2012 Share Posted May 8, 2012 They honestly blow my mind, that first one especially. While being slightly crackden like, over here would still sell for maybe $150k in my town. And with a new roof, paint, any kind of lawn/garden work and a bit of new drywall would go for upwards of 200k. What kind of cesspools do you guys live in haha or is America really that far gone as a whole? no, go about 15 miles east of that first house and you will see million dollar homes. there are just some areas, like in most states, that i would never, ever consider owning a house no matter how good of a buy it might be. so while 20k - 30k houses do exist, they are going to be in shitty condition and/or really bad neighborhoods. if youre okay with living out in the middle of nowhere (ie. 45 - 60 min away from where you are likely to work / play), you could probably get a brand new house starting around 80k. That's what blows my mind. I already DO live far from work. I'm about 90 minutes south of Sydney, and travel up there each day for work. And even semi-decent 3 bedroom houses in my town are 400-500k. If you are within 30 minutes drive of the Sydney cbd, for the same house you're looking at 1mil plus. And this is after our housing downturn of the last 4-5 years. Although our crap suburbs aren't nearly as dangerous as your guys crappy suburbs. I want to buy a house over there with my tax return now hahaha Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted May 8, 2012 Author Share Posted May 8, 2012 Is there such a thing as cash-only housing auctions and can you get houses for steals out of them? Given that I have a lot of cash saved up, I wonder if this is best for me. Quote Link to comment Share on other sites More sharing options...
Guest Posted May 9, 2012 Share Posted May 9, 2012 You shouldn't have to worry about the real estate agent's commission as a buyer. That should be paid by the seller. You may be able to negotiate the percentage and flat fees. That may be easier with someone who doesn't work in a bigger company (Long and Foster, etc.). Also be a bit wary if both agent's work out of the same office. If the house is banked owned, or HUD, the buyer will have to pay the fees. Otherwise, you are correct. Quote Link to comment Share on other sites More sharing options...
mattisr1984 Posted May 9, 2012 Share Posted May 9, 2012 Is there such a thing as cash-only housing auctions and can you get houses for steals out of them?Given that I have a lot of cash saved up, I wonder if this is best for me. dont really know anything about the housing auctions but they do exist. i wouldnt buy any house without seeing it and the neighborhood its in first though. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted July 10, 2012 Author Share Posted July 10, 2012 Considering making an offer on this one: http://www.zillow.com/homedetails/22471-E-10-Mile-Rd-Saint-Clair-Shores-MI-48080/83499441_zpid/ It is a badass home in the area I want to live, but I'm a little worried about overextending myself. I am preapproved for $150k with 10% down, though. Walking through tomorrow morning. Obviously, you don't make an offer on a house before you see it in person. I am basing my above comments on the pictures / general feel of the place. Quote Link to comment Share on other sites More sharing options...
BuzzersonKillwell Posted July 10, 2012 Share Posted July 10, 2012 Considering making an offer on this one: http://www.zillow.co.../83499441_zpid/ It is a badass home in the area I want to live, but I'm a little worried about overextending myself. I am preapproved for $150k with 10% down, though. Walking through tomorrow morning. Obviously, you don't make an offer on a house before you see it in person. I am basing my above comments on the pictures / general feel of the place. Make sure you factor in other prices like taxes and PMI if they hit you with it. I refinanced at 150K because I had a bunch of equity, but my mortgage is still over 1k a month. I'd do it again but I was a little stretched the first few years. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted July 10, 2012 Author Share Posted July 10, 2012 Yep. I think I can argue the taxes down to about $4000 a year. It's still a LOT, but that house looks incred. PMI is a non-factor. It'll be about $50 a month. My mortgage will be around $1k a month. My terms are 5.25% at 20 years. As a PhD student with non-conforming income, that was the best I could do. FHA and Fannie Mae won't touch me. I can refinance when I get a real job. I think the value is there in that house to deal with it. The canal is pretty much dried up. Maybe you could get a canoe through it. That's why there are no boats in any of the pictures. I'm hoping to use that to my advantage and maybe get the price down. I am 10 times more concerned with the quality of the house vs. whether it is on a canal or not. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted July 19, 2012 Author Share Posted July 19, 2012 Offered $140 on that place I had above. It's a bank-approved short sale and they really priced it close to what it is worth to begin with. They came back at $147. I considered just taking it, but decided to counter at $145. Risk is that someone else comes in and starts a bidding war. It's worth the $147 probably, but not like 2 grand is chump change. Chanced it. Kinda having trouble getting work done cause of the anticipation of an answer. Quote Link to comment Share on other sites More sharing options...
robotfactory Posted July 19, 2012 Share Posted July 19, 2012 god damn i wish i didn't love california so much. houses are so inexpensive elsewhere. i can't imagine living outside of northern california (we love it here) and if i "had" to move i would really only be interested in portland, potentially seattle area, and maui. all of which are not exactly cheap places to live. we paid $315K for our 2 bedroom townhouse 2 years ago, which was a pretty damn good deal. i would love to buy an actual house for $150K! Quote Link to comment Share on other sites More sharing options...
One Hundred Fifty-Two Posted July 19, 2012 Share Posted July 19, 2012 Was thinking about buying a multi unit location and living in one unit and renting the other ones. I plan on making more in rental income than the mortgage would be. What am I not thinking about that stops other people from doing this? Quote Link to comment Share on other sites More sharing options...
Emo Revival Posted July 19, 2012 Share Posted July 19, 2012 Was thinking about buying a multi unit location and living in one unit and renting the other ones. I plan on making more in rental income than the mortgage would be. What am I not thinking about that stops other people from doing this? Shitty renters and the added upkeep costs. I've been thinking about doing that for some time now, but just haven't pulled the trigger cause I know how people treat things that aren't theirs. There's a good chance in the next year or so that I'll just say fuck it and buy a second house and turn it into apartments Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted July 19, 2012 Author Share Posted July 19, 2012 Was thinking about buying a multi unit location and living in one unit and renting the other ones. I plan on making more in rental income than the mortgage would be. What am I not thinking about that stops other people from doing this? It's definitely a good idea. The thought crossed my mind of "do I want 1 $150k house to live in or 3 $50k houses to rent for profit". In addition to upkeep, hassle of bad renters, also your property taxes can pretty much double. Not sure if you can write off mortgage interest on a house you are renting for profit. You get taxed on what you earned as income. Then there is the actual mortgage interest. All of this eats into that margin to the point where the return might not be worth the hassle. I'm going to rent my current house out to a friend when I leave for the new one. It's worth about $35k and completely paid off. Deal is for $700 a month. Might have gotten $800 if I had gone to the paper but I'm happy to have someone I trust in there. After $250 a month in taxes I'm pulling in $450 from it. Assume Uncle Sam takes 30%, and I'm making about $300 a month on $35k investment. Then there is upkeep. Maybe $50 a month? Anyways, all estimates but I think you get the point. I might make 10% profit. It's not like I'm raking in money hand over fist and there is some work to it. And that's without any mortgage interest. Might be able to do just is well in stocks and all I have to do is push "buy" and "sell". Quote Link to comment Share on other sites More sharing options...
One Hundred Fifty-Two Posted July 19, 2012 Share Posted July 19, 2012 Any idea how much it costs to get like a lawyer to draft a rental agreement and how much it'll cost to get an accountant (or real estate agent if they do that stuff) to help me with the taxes? But yeah, shitty renters and upkeep I understand are a major part to it. The low house values and low interest rates really entice me. I did a quick seach online and there were multiple places listed for 150,000 for 3 unit places. I could live in one, with a roomate even, and then rent out the other two. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted July 19, 2012 Author Share Posted July 19, 2012 I don't know. Try Google if you haven't? Every situation / city is different. My general feeling is that given what you said (low prices and low interest rates, combined with a relatively strong rental market from the people who have recent foreclosures) is that you will come out ahead if you do it. Whether it is the absolute best investment you can make? Whether the hassle is worth the payoff? No one knows. I feel confident you won't lose money doing it and might come out of it very nicely. Quote Link to comment Share on other sites More sharing options...
seangj Posted July 19, 2012 Share Posted July 19, 2012 I do this, and if you don't have good renters it sucks. It is also a lot of work because I do everything myself and not through a management company. Quote Link to comment Share on other sites More sharing options...
¯\_(ツ)_/¯ Posted July 20, 2012 Share Posted July 20, 2012 bought our 3 BR house for 98k in the burbs of pittsburgh a couple years ago, tried to get financing to do some work on the property and the banks wouldnt lend money because 3 houses around us were sold as forclosures for 45-55% less than value, and since they were the only comps in our area, we "owed" far more than what our property was "valued" due to these comps. so fucking lame. just got a credit card to pay for it and paid it all off with the 1st time homebuyers 8k that we got. Quote Link to comment Share on other sites More sharing options...
robotnetwork Posted July 20, 2012 Share Posted July 20, 2012 buy the cheapest house in the most expensive neighbourhood. Quote Link to comment Share on other sites More sharing options...
afireinside7444 Posted July 21, 2012 Share Posted July 21, 2012 We bought a amazing foreclosed house last year for $174k they were $250-275 when built in '96. And according to neighbors at the height of the market worth near 350k. Though now the house 4 doors down with a terrible lot and nauseating blue color is going for $225k http://www.zillow.co.../24370879_zpid/ I had left my old house with my parents but then my dad got sick and died from cancer so I had to move my mom into her fully renovated but smallish house instead of renting it and had to foreclose on my old one/file bankruptcy so they cant come after the 89k I owed (they sold it for under 40k and the area wasent too terrible) Im not really any help with your specific questions, just glad I bought the new house before having to foreclose. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted July 23, 2012 Author Share Posted July 23, 2012 We bought a amazing foreclosed house last year for $174k they were $250-275 when built in '96. And according to neighbors at the height of the market worth near 350k. Though now the house 4 doors down with a terrible lot and nauseating blue color is going for $225k http://www.zillow.co.../24370879_zpid/ I had left my old house with my parents but then my dad got sick and died from cancer so I had to move my mom into her fully renovated but smallish house instead of renting it and had to foreclose on my old one/file bankruptcy so they cant come after the 89k I owed (they sold it for under 40k and the area wasent too terrible) Im not really any help with your specific questions, just glad I bought the new house before having to foreclose. Cool. That house is really nice, though, blue vinyl or not. Quote Link to comment Share on other sites More sharing options...
afireinside7444 Posted July 24, 2012 Share Posted July 24, 2012 Ya but its odd that the prices went up so fast. We got our house (same layout as that one) on 2 acres with a few mile long swath of un-developable woods/natural pond in the rear on from what the neighbors have said is the best most desirable lot in the sub for 45k less..... 1 year ago. I guess it depends on whats owed on the house also Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted July 24, 2012 Author Share Posted July 24, 2012 And that is an asking price, not a sold price. My experience is that the Zillow price estimate is pretty accurate, maybe a little on the high side. Probably a $180k house based on the extremely limited amount of information available. Quote Link to comment Share on other sites More sharing options...
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