Get a full survey done, and walk away at the barest mention of dry rot. There are three type of survey: the cheap one where they drive past, the medium priced one where they go in and do little more than a visual inspection, and the full one where they examine everything.
Don’t buy a property that’s down a set of steps.
Check the neighbourhood for drug centres and the like. Don’t just drive around; use Google Earth. My brother was strongly considering a place until he spotted on Google Earth that next door but one, behind discreet hedging, was a centre for drug addicts.
Noise is another big one: are you going to be under a flight path?
When you go to look at a place, test all the taps and flush all the toilets. I found out about drain issues at one place through the latter: flush toilet = stench = goodbye!
Sounds like you have a good idea on monthly costs. But if you’re buying any home older than 15 or 20 years, another good idea would be to budget 10% over your “nut” (insurance, tax, mortgage) for maintenance costs. These won’t come in a steady flow, it’ll be more like nothing for a year and then BAM $2500 for air conditioning or $500 for plumbing, or $8000 for roofing, etc.
Do NOT buy a house with minor foundation issues unless you are prepared to spend the money UP FRONT to fix them. You’ll regret it later. (If the house has major foundation issues, just walk away and don’t even think twice.)
And any utilities, especially those that were included in your apartment bill. We had an electric bill for our apartment, but we were surprised about the trash bill, the gas bill, and the water bill, all of which were included in our rent, and which these days are coming out to a couple hundred dollars a month (now that we have the kid, and lately we’ve had the heat on a lot more).
ETA: Huh. I should have checked your post more carefully before replying. Anyway, good on you for realizing that’s going to be an issue
Don’t just ask about the neighbors, go and talk to them. Say you’re looking to buy next door and wanted to say hello. Ask them about your potential house. Ask about the neighborhood. You’ll get all sorts of info that your agent won’t know or can’t tell you. Don’t forget the backside neighbors.
Also, sit in your car on the street by your house for a half hour or so at different times. Early morning, midday, evening, late evening, both weekdays and weekends. Also, drive around the entire neighborhood (a couple streets over each way) at various times and days.
Better to find out things now, than after you’ve bought.
Perhaps that was just a typo/thinko, but in my experience you get the inspection after making an offer and agreeing to a price. No point in paying for an inspection if you can’t arrive at a price. By the time you get the inspection you’ve probably put down some earnest money, but the contract should then let you renegotiate or get out of the contract completely, with no penalty—you’ll get your earnest money back. Perhaps things are different where you are, but that is how they work in Colorado, which is a very easy state (from the legal and bureaucratic standpoint) to buy a house.
I backed out of a house I went under contract on after the inspection. Instead of $300 wasted, I looked at it as $40,000 and numerous headaches, saved.
How does the district you’re considering do placement? Around here you can freely choose any school to enroll in (transportation may be your problem, though), but popular schools will have waiting lists. You’re guaranteed entry to the school your in the takement area for. So, which elementary, etc. your nearest might not be that big of a deal.
My wife and I thought about the school issue quite a bit when buying our house, even though we don’t have kids. Partly it was because there were 1000s of houses in our price range in the area we were looking, so eliminating the two weaker school districts and restricting ourselves to the two stronger ones made shopping much easier. Also, we did get a bit frustrated with the individual school rankings, because different websites and assessment methods didn’t agree at all. What we finally realized was that even the “worst” high schools in the better districts, were as good or better than the “best” high schools in the weaker districts. And, any differences between the “best” and “worst” schools in the better districts would probably be overwhelmed by the individual differences in our hypothetical children—their success or failure is probably more do with themselves (and the family) than just a school ranking. Having said that, we did deliberately avoid the places that were bad, we just stopped worrying about the difference between “completely fine” and “exceptional”.
One final thing which recently came in handy. If the sellers seem like good people, try to get a list from them of who has done the work on the house/yard in the past. If it’s just a bank, or they’re idiots, then you might not bother. Being able to call the sprinkler guy who’d been working on my house’s sprinklers for 15 years (I’ve owned it for less than 2) when they didn’t work right was a huge time saver. He remembered the system, explained parts of the quirks that I’d never understood (the completely disconnected zone), and generally was interested in seeing his past work kept up. He might have just been a decent sprinkler guy, but having never used one before, I may as well take the crapshoot on the guy who knows the system over somebody random from google.
I can’t emphasize this one enough: find out who built the house, then ask around about the builder.
Some builders are excellent. Others suck and have been sued multiple times. If you hear bad things about whoever built the house you want – find another one. Yes, the house may look perfect and pass inspection but for all you know they did a shitty job digging the foundation and in 15 years you’re gonna be screwed.
Another thing I did when I was house hunting (this past fall) - try to find out WHY the seller is selling. Technically, no, it’s none of your business, but knowledge is power. If, for example, they’re, say, divorcing – that may give you the upper hand on negotiations because they may be in a hurry to sell.
Whatever you do, be ready to walk away. It’s a buyer’s market, DON’T SETTLE! Get the very best house you can afford and take your time!
I’m assuming you’ve already done this but if not: go get preapproved for a mortgage (not prequalified). Don’t waste a bunch of time looking at houses only to put in an offer and get surprised by the bank.
Using Zillow, Google, etc. it was pretty easy to get an idea of what neighborhoods we’d be looking in. My wife and I drove through them on our own, just to get a sense of what they were like. Sometimes you can’t tell from the house picture how close the houses are, how old they are, are they all the same, etc. We spent two weekends or so driving 100+ miles, but it made it much easier to say, “oh, it’s in that neighborhood, we’re not interested.” As I said in my previous post, part of our trouble was narrowing down from 1000s of places to a manageable number, so we were deliberately picky.
Also, buying a house is incredibly stressful. Be sure to communicate with your spouse what you’re thinking, and ask what he’s thinking. I kept picking dumps and pointing them out to my wife, “this one has a falling down loafing shed, a cell tower in the front yard, and is only 50 feet from a major highway, but we can afford it!” or “the unlicensed septic system can’t cost more that $20,000 to fix!” I was (mostly) joking, but but she didn’t immediately pick up on that, so she really thought we were way off on what kind of places we were looking for. Once I realized that what I needed to say instead was, “look at this dump I found, let’s laugh at it together” the stress level went way down between us.
I, too, have never heard of an inspection before a contract. The contract has an escape clause for the inspection, so it’s risk-free, but if you pay before the contract and can’t agree on the price, you’re out money.
Second, lock in a rate when you can. I don’t know if you had to do that to get pre-approved, but if you haven’t, now’s the time. They’re sub-4%, and I doubt you’ll ever see better than that.
Third, beware closing costs. They’re always higher than you think they’ll be. If you’re tight on down-payment money, try to close at the end of the month so you don’t have to pre-pay interest for a whole month. This strategy doesn’t actually change the total amount paid; it just shifts it around the calendar.
Fourth, don’t fall for the trap of thinking a place half-meets a need. If you need three bedrooms and it has 2 1/2, then it’s NOT for you. If you need to be on a bus line and it’s 3 blocks from a bus, it’s NOT for you. In other words, “3 blocks from the train” is not the same thing as “on the train,” so decide which one is the real need.
Many cities have interactive maps / booking sheets available online. See if your potential city does, and take a look at what kinds of calls are made in the neighborhood. If there is nothing available online, call the Community Officer and ask. There may be nothing, or you may discover the next street over is a hotbed of activity.
If schools are important, go ahead and call to find out whether your potential house is that schools boundaries. However, and maybe it’s just me, I would not be so concerned about elementary schools, as there always seems to be one every other block. Changing schools is easier. If you plan on residing there long term, look at the middle and high schools as there is less of a choice (there are 20 elementary schools in my district - 2 high schools. Luckily we picked the “right” one for us).
Yes, closing costs can be a killer, but they too are often negotiable. Some of the costs have fancy names, but are really just profit for the mortgage company. They’ll make most of their money when they turn around and sell your mortgage, so they’ll probably be willing to negotiate some of their fees if they think they can make it back when they sell the mortgage. It can be worth several thousand dollars in closing costs alone to shop around, and pit one place against another. For example, my credit union had a basic mortgage deal they did, which wasn’t terrible, but the company I ended up going with waved all of their fees just to get my business. That left me with lots of title fees and stuff, but those were all real things, like the cost of title insurance, and to transfer the deed, etc., not just pure profit for the mortgage company.
Negotiating all of these things does boost the stress level, but it is nice to make the $800 “mortgage processing fee” disappear with a phone call.
As to the first point that was a typo, yes. As for the list of people who’ve maintained the house that is an excellent idea!
We have been preapproved so we are good to go on that front. Finding out why the sellers are selling is a good idea too, though I imagine they aren’t afraid to lie through their teeth to sell their house. As far as the companies who built these places go though that I don’t think will be so important. In the areas we are looking almost every building is at least 75 years old and many of these homes are more than 100 years old. I will try to find out which companies have done the maintenance work though and apply the same theory.
Both of these are excellent advice. I’m trying to be very cautious to avoid the half-meeting-a-need issues that I’m sure will come up. I’m also trying very hard to avoid falling in love with any particular place and trying to be Vulcan-like in my objectivity. We’ll see how that goes.
I actually like our HOA. It enforces rules so the neighborhood looks nice. No junky/abandoned cars in the street, no trashcans left on the curb for days, no piles of trash, everyone’s grass nicely trimmed and flower beds well-maintained. Sure, there are rules about what color we can paint the house, but I kind of like the way the neighborhood looks, so it’s fine with me. We haven’t lived there long, but we’ve had 0 drama with the HOA.
Find out if your neighbors own or rent. We didn’t realize that that the house next to ours is a rental. This summer, the nice family moved out and umpty thousand partying college students moved in. They are overall nice, but they party loudly (even during the week), have guests that completely fill street parking up and down the road and pitch trash in my yard (beer cans, vodka bottles, etc). Ugh.
Make sure that the house you bid on isn’t too much of an “oddball.” For example, if pretty much all the houses in the town you like have 3 bedrooms, be wary of purchasing a 2-bedroom house even if that’s all you need.
As another example, if pretty much all the houses in the town you like have their own driveways, be careful of bidding on a house with a shared driveway.
These kinds of houses can be difficult to sell if the market is weak. Since a large percentage of buyers will summarily eliminate the house from consideration.
I disagree about calling the police; I doubt that many police officers will give the candid advice you need to an anonymous person on the phone. Better to lurk around the neighborhood at different times and even knock on a few doors. Better yet to rent in the area for a year until you know the neighborhoods pretty well.
Good drainage is really important - you don’t want water in your basement (or even worse, the ground floor, if the house doesn’t have a basement) when it rains.
So when you’re looking at the house, walk around it and ask yourself, “where does the water go?” Then when you come back on a rainy day, don’t just check the gutters, also check to see what’s happening with the runoff. The main things are, you don’t want water pooling around the house, you want slopes that will take the water away from your house.
You don’t ask the sellers, or their realtor (you can, but they may lie, or just refuse to answer). There are other ways of finding out. Most people put all their personal business out there online, all you gotta do is know where to look. YOUR realtor may also have ways of finding out stuff.
Re: closing costs – I don’t see any reason, right now, for any buyer to pay them (unless you’re in one of a handful of cities in which sellers aren’t completely screwed right now). There are too many people out there DESPERATE to sell their home and have already accepted that there’s no way they’re selling without paying them. Take full advantage of this! You’ll probably never again have the deck stacked in your favor like you do right now.
When we bought our house, CC’s were a huge issue – we HAD to have them. The sellers had a bottom line amount they wanted … we offered 5k more, and in exchange they paid all CC’s and other fees. Worked out great — they sold their house (it was rental property for them anyway, they flipped it and made a pretty penny), we got the house we wanted AND we still came in 20k under budget.
Is there a school bus stop very near the house? I don’t want to be that “get off my lawn, you damn kids” kind of guy, but having a bus stop near your house can suck. The kids might be loud early in the morning waking you up, leaving trash, breaking things, and testing the property boundaries.
I have a school bus stop right in front of my house. I have had to get little girls to stop climbing the trees in my yard. I have had a parent get pissed at me when I asked him to stop letting his kids play in my backyard while waiting for the bus. His reply- “It’s a bus stop man, what you expect the kids to do?” I had to yell at the kids hiding under my ornamental bushes “because it’s raining”. And then there’s the kids who pump their arms up and down to get trucks to blow their horns at 6 AM. The kids who torment my dog and make her bark. The parents who park in my driveway while waiting to pick up their kids.
Check out the neighborhood at as many times of the day as possible for unexpected activity. Take walk around the neighborhood and ask them questions.
A nearby street from my house had a huge traffic issue at 4:05 pm because a manufacturing plant took shortcuts through the neighborhood.
I never realized until I left work a little early one day and had to cross that road to get to my house. I was like WTF did all this traffic come from?
To add to the HOA debate-do not forget to add in HOA/condo association fees to your monthly costs.
I personally am in support of having an HOA. Even though the nazis at mine made me replace all the hardware on my door because the brass wasn’t shiny enough, I really do appreciate the fact that all the houses are kept up, and there aren’t any crazy colors or overgrown yards in my townhouse complex. In addition, I find it useful to have somebody remind me when it’s time to paint or point out that I have woodrot in my trim or missing shingles. I seriously would not remember to examine my entire exterior that closely twice a year, and I think that I’m probably preventing problems by making the little fixes early.
I also support a bathroom on each floor (which is why I have 4 bathrooms-one for me, one for guests, and one for each cat). You do NOT want to be running up and down stairs, especially with a child who needs to go NOW.
Also check for neighbors’ pets. (This all comes down to checking at various times of the day). You do not want to live next to the person who leaves their dog alone to bark for 12 hours a day.
