N/A How do you buy a house?

mikea

mikea

Touchdown! Greaser!
Gone West
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iWin
I've gotten a bug to actually plan to buy a house near the airport (yeah, the one to buy a car went away). I've been looking at what's out there. I've decided I could be happy with a pre-fab tract house with a basement to hold my too-much stuff and a 2 car garage. I see some that may be 30 minutes away from my airport and within reach of UGN if I had to move the plane there.

I'd be willing to take on a fixer-upper that doesn't need big stuff. I can do electrical work and plumbing.

What I don't how to do is find an agent. I need to tell one to watch for something that meets my criteria. I was very close to calling a Century 21 but I wondered if I'd regret that. There's no point in me going out and looking when I know that I won't be ready to close until January or March.

Anybody have any advice?
 
Hey Mike, good luck on your seach. As for locating an agent, I suggest speaking with co-workers, folks at the airport, friends, family, etc. and ask their opinion about the agent that helped them purchase their house.
This is the route we took on two occassions (specifically co-workers) and it worked just fine but YMMV.
 
Mike abslolutly ask friends co workers etc. for referrals. There are a lot of folks doing real estate who don't know a lick about what they are doing. If you have an attorney he or she would be an excellent source for a referral.

We joke here that every board housewife in my county is a Real Estate Agent. Try not to just cold call and agency b/c who ever answers the phone is who you get.

Make sure your realtor is a mamber of your County board of Realtors and is a member of the MLS ( Multiple listing service) most are but ya never know. Finally it is perfectly fine to speak or interview 2-3 folks and pick the one you fit best with. Good luck. Ya gotta cut that 50 mile drive to the airport.
 
mikea said:
I've gotten a bug to actually plan to buy a house near the airport (yeah, the one to buy a car went away). I've been looking at what's out there. I've decided I could be happy with a pre-fab tract house with a basement to hold my too-much stuff and a 2 car garage. I see some that may be 30 minutes away from my airport and within reach of UGN if I had to move the plane there.

I'd be willing to take on a fixer-upper that doesn't need big stuff. I can do electrical work and plumbing.

What I don't how to do is find an agent. I need to tell one to watch for something that meets my criteria. I was very close to calling a Century 21 but I wondered if I'd regret that. There's no point in me going out and looking when I know that I won't be ready to close until January or March.

Anybody have any advice?
Click to expand...

Take an hour to drive around the area you are considering and write down the agent's name on every house for sale sign you see. Check into the ones that seem to favor the class of property you want to buy. You might also ask folks at the airport that are old enough to own a house who they would use for an agent. Someone with local knowlege and a good track record is what you are looking for.

I'd be careful about the "fixer-upper". It's kinda like an airplane, unless you plan to live there for at least 5-10 years, you probably won't recoup the cost of any "fixing" unless you get lucky. Besides, why spend a lot of time working on a house instead of flying or at least hanging out at the airport.
 
just build an oversized hangar, put an apartment in it. then you will fly every day.

or walk up to the development going in next to the airport, write a check and put big "I *heart* Airplane Noise" signs in your yard.
 
Personal recommendations. It's the only way to go.

Just remember, despite what they might say, they are working for the seller. Buyer beware.

(yeah, I know about buyers agents - in the end most of them are compensated from the proceeds)
 
The house next to me is for sale. Only 40NM south of C81, and we have TWO good GA airports within 5SM, 1C5 and LOT. The bank foreclosed on the house, so you might be able to get it for a steal. Sometime I'll tell you the story behind it. It's atypical for the neighborhood, but a good yarn.
 
Best thing for me was, pick a few agents, have them ALL email you listings that MEET YOUR CRITERIA, and review pix and details on the net for each listing. Then go view a few of the very best looking ones.
 
A good agent is very very important. You want a go-getter who is honest. I've been extremely fortunate - in DC, my realtor was a go-getter (despite not actually finding my house for me, but, I was very motivated and found the listing and insisted to see it the day it opened and was lucky I did).

My SC realtor came with a glowing recommendation from friends who had bought down there earlier that year. She's wonderful - she knows the area extremely well and knows all the ins and outs of realty. She threw herself into her new career with a lot of zeal.

this is the kind of person you want. and you want to build a good relationship with them... then they will look out for you.
 
Most agents tend to focus on one particular area, either because it's close to where they live or because they like its spot on the price/value curve or because the houses tend to sell themselves. And so often you give them your general criteria for size, price, design, etc and they will try to shoehorn you into "their" area.

I have bought six houses now. When we were shopping for the most recent one, we changed realtors twice until finally the third one listened to what we were saying instead of trying to get us to accept her preconceived notion, as the previous two had done.

Also, resist the urge to settle for close enough. This purchase will literally be with you every single day. Take your time, look at a lot of houses. I have found that I recognized the right one the instant I walked in the door, and then it just became a matter of price. You're always going to want to change a few things. Make sure you can afford to do that.
 
Ken Ibold said:
Most agents tend to focus on one particular area,
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Ken is right on. The first step is to figure out where you want to live. Location, location, location and all that.

Since it is a bit like aircraft design, where everything is a trade off, make a list of important factors: school districts, parks, political leadership (prolly an oxymoron but you never know...), municipal facilities, sports facilities, shopping, necessity shopping (grocery stores, cleaners, etc) highway access, airport access (OK, now you can remove the "N/A" in the title!), and anything else you can think of that is important to you. Rate these in order of importance.

Now get out a map, get in the car, and go find out what areas rate highly on the factors that are important to you.

Finally, cruise that area, look for broker's signs, talk to anyone you can think of to get a broker reference. Then interview the broker. Note that you are looking for an individual, not an office. I have found that brokers in all brokerage offices, including the local office of national chains, can vary widely in expertise. Try and get a sense of how much the broker is listening to you. Ask him/her for a list of homes that s/he has listed or sold in the area you want, and ask her to tell you why that home would/would not be a good home for you.

Good luck! Report back. We'll all come to the housewarming!

-Skip
 
Thanks all.

One thing that keep me from making phone calls is that I'm not in a hurry. The biggest deadline is to nearer to the plane come next spring. I can deal with that one. I don't need to have a broker to keep after me and wonder if I'm just a time waster.

The dilemma is I don't really care what town it is. I'm thinking that there are undiscovered areas that haven't upgraded downtown to 2 Starbucks yet. I just drove through and saw that the town where the airport is just did that. The A&W is gone to be replaced by rows of concrete block facades of boutiques.

I just drove around trying to figure out where these towns are and how they connect, and tried to gauge what the driving times would be like. The biggest surprise is there are a lot of new train stations to take you downtown, which is one of my needs for the moment.

I had thought to get the local papers to check out the local politicians and see which towns were outlawing breathing while different.

I read a while ago that one town announced it was going to ticket anybody doing 26 in the 25 MPH zone. I'm not interested in that town, even though one of my amusements is to set the cruise at 25 (I can't cruise at 25 manually in the Mustang - there's no gear to choose for that) and watch the SUV mamas behind me fume.

I think I can go on the web and see what the city councils are up to lately.

I'll start a database and keep notes of what I find.
 
be careful when you find a realtor - many of them will want you to sign an exclusive agreement with them - not a problem as long as you KNOW they are the one for you - just refuse to do so until you are sure you aren't going to change...
 
another thought - have you considered building? are they building new homes in your area? a lot of times you can get a nice new house for about the same price as an older one b/c builders want to build, sell, and get out.

plus you can pick from a few different models and go from there.

it's worth looking in to, if nothing else... at minimum you can get an idea for what you might like in a house and locations, etc. and you won't be wasting any realtor's time, you can do it yourself by walking through models on wkds.

you may be pleasantly surprised.
 
woodstock said:
another thought - have you considered building? are they building new homes in your area? a lot of times you can get a nice new house for about the same price as an older one b/c builders want to build, sell, and get out.

plus you can pick from a few different models and go from there.

it's worth looking in to, if nothing else... at minimum you can get an idea for what you might like in a house and locations, etc. and you won't be wasting any realtor's time, you can do it yourself by walking through models on wkds.

you may be pleasantly surprised.
Click to expand...
Nah. I think even 1960s prefab crap is better quality than what these outfits are building. I might look at some new ones, but I have my doubts. There's something about the standard grand entrance stair with overlooking balcony thing that I don't like. I might change my mind when I see some, though.
 
mikea said:
Nah. I think even 1960s prefab crap is better quality than what these outfits are building. I might look at some new ones, but I have my doubts. There's something about the standard grand entrance stair with overlooking balcony thing that I don't like. I might change my mind when I see some, though.
Click to expand...


but they build all sizes! you can buy a small house, condo, whatever you want.

I sincerely doubt pre-fab is better than stick-built.
 
woodstock said:
but they build all sizes! you can buy a small house, condo, whatever you want.

I sincerely doubt pre-fab is better than stick-built.
Click to expand...

Au contraire. 'Pre-Fab' is becoming, basically, a panelization process where you 'stick build' offsite. Quantitatively, a panelized home has far fewer variances than stick-built in place homes, are open to the weather for a much more brief period of time, and result in fewer post-construction issues.

That said, you can build a great house or a mediocre house both stick built and panelized, so the method of the construction isn't really the factor in final build quality.

We have been looking at panelization in my company not from a cost savings perspective, because we simply won't save much if anything, but from a quality control perspective.
 
mikea said:
Thanks all.

One thing that keep me from making phone calls is that I'm not in a hurry. The biggest deadline is to nearer to the plane come next spring. I can deal with that one. I don't need to have a broker to keep after me and wonder if I'm just a time waster.

The dilemma is I don't really care what town it is. I'm thinking that there are undiscovered areas that haven't upgraded downtown to 2 Starbucks yet. I just drove through and saw that the town where the airport is just did that. The A&W is gone to be replaced by rows of concrete block facades of boutiques.

I just drove around trying to figure out where these towns are and how they connect, and tried to gauge what the driving times would be like. The biggest surprise is there are a lot of new train stations to take you downtown, which is one of my needs for the moment.

I had thought to get the local papers to check out the local politicians and see which towns were outlawing breathing while different.

I read a while ago that one town announced it was going to ticket anybody doing 26 in the 25 MPH zone. I'm not interested in that town, even though one of my amusements is to set the cruise at 25 (I can't cruise at 25 manually in the Mustang - there's no gear to choose for that) and watch the SUV mamas behind me fume.

I think I can go on the web and see what the city councils are up to lately.

I'll start a database and keep notes of what I find.
Click to expand...
I think you are off to a good start. My wife and I started looking when we noticed that the third child was on the way. It took a year. We looked in many different places. We used the internet to research schools and neighborhoods. We drove around for hours - not really a chore as it is the best way to get the kids to nap. When we found a house that we thought would be interesting we called the listing broker and asked to see it. Remember the broker represents the seller. They have DUTY to get the most money possible for the SELLER. You want to pay the least possible. We found that the local (and very large) Prudential broker had an excellent web site and we could find most listings without the need to invovle a broker.

Don't be in a hurry. Don't settle for less than you want. There will always be another house. I read somewhere that the average home in the U.S. is owned by the same person for only 7 years. Think about it, on the average 14% of all the homes in any given neighborhood will be sold each year. Our priorities were commuting time and school district and we paid for those qualities, but we think it was worth it.

Adam Z handled the title work and did a fantastic job. That is another thing, the realtors often have captive title insurance companies and captive vendors for other services. They will generally try to "make your life easier" by offering to help you with these things and then steering the work to their company. They are not completely dishonest about it, but they are not particularly up front either. They ask you to sign a statement saying they have disclosed that they "may" recommend "affiliated" companies. Then they will do everything they can to get you to use those companies. I cannot tell you the number of times we said to the broker "is that a legal requirement?" and they said well no of course you can use another vendor.

Example:

Broker: Congratulations the seller accepted your offer. We'll have the paperwork drawn up tomorrow. We'll arrange the home inspection and the title work.

Unstated is: a) they will give the business to their company, b) they will not be serving your interest by seeking a better price or better quality.

It is lawful but you should be very aware of it since it is often Not in your best interest.

Remember, the seller pays the commission and the whole real estate sales industry is geared towards satisfying its duty of loyalty to the seller. Do not get fooled by a cooperating broker telling you they represent your interests, they do not, and usually are not legally allowed to. They try all sorts of tricks. They have very lengthy meaningless buyer broker agreements. They are meaningless because they rarely disclaim the duty of loyalty to the seller. They are misleading because they imply that the broker will be loyal to you.

There are in actuality some true "buyers broker" out there, but if they EVER work on the selling side of transactions then even if they are truly representing you (i.e. getting paid other than through the selling commission) they will have an unspoken desire to protect that part of their business. This unspoken desire may lead them to work just a little less aggresively because after all, they may need to deal with the seller's broker on another deal and they don't want to ruffle feathers.

So, be careful. Do your own legwork. Protect yourself. Beware of pressure tactics and unstated loyalties. This is capitalism and the whole real estate sales industry exists for only one purpose - to make money for the real estate sales industry.
 
A buyer's agent can represent your interest and will have a legal duty to do so. However, a true buyer's agent is paid by YOU, sometimes for a flat fee, sometimes for an hourly rate. One agent I know would take 1% of the sale price, plus 30% of the amount she saved you (being the difference between the asking price and the price you paid).

Regardless of how you hire an agent, your appraiser and home inspector should be paid by YOU and represent your interests.
 
Arnold said:
I think you are off to a good start. My wife and I started looking when we noticed that the third child was on the way. It took a year. We looked in many different places. We used the internet to research schools and neighborhoods. We drove around for hours - not really a chore as it is the best way to get the kids to nap. When we found a house that we thought would be interesting we called the listing broker and asked to see it. Remember the broker represents the seller. They have DUTY to get the most money possible for the SELLER. You want to pay the least possible. We found that the local (and very large) Prudential broker had an excellent web site and we could find most listings without the need to invovle a broker.

Don't be in a hurry. Don't settle for less than you want. There will always be another house. I read somewhere that the average home in the U.S. is owned by the same person for only 7 years. Think about it, on the average 14% of all the homes in any given neighborhood will be sold each year. Our priorities were commuting time and school district and we paid for those qualities, but we think it was worth it.

Adam Z handled the title work and did a fantastic job. That is another thing, the realtors often have captive title insurance companies and captive vendors for other services. They will generally try to "make your life easier" by offering to help you with these things and then steering the work to their company. They are not completely dishonest about it, but they are not particularly up front either. They ask you to sign a statement saying they have disclosed that they "may" recommend "affiliated" companies. Then they will do everything they can to get you to use those companies. I cannot tell you the number of times we said to the broker "is that a legal requirement?" and they said well no of course you can use another vendor.

Example:

Broker: Congratulations the seller accepted your offer. We'll have the paperwork drawn up tomorrow. We'll arrange the home inspection and the title work.

Unstated is: a) they will give the business to their company, b) they will not be serving your interest by seeking a better price or better quality.

It is lawful but you should be very aware of it since it is often Not in your best interest.

Remember, the seller pays the commission and the whole real estate sales industry is geared towards satisfying its duty of loyalty to the seller. Do not get fooled by a cooperating broker telling you they represent your interests, they do not, and usually are not legally allowed to. They try all sorts of tricks. They have very lengthy meaningless buyer broker agreements. They are meaningless because they rarely disclaim the duty of loyalty to the seller. They are misleading because they imply that the broker will be loyal to you.

There are in actuality some true "buyers broker" out there, but if they EVER work on the selling side of transactions then even if they are truly representing you (i.e. getting paid other than through the selling commission) they will have an unspoken desire to protect that part of their business. This unspoken desire may lead them to work just a little less aggresively because after all, they may need to deal with the seller's broker on another deal and they don't want to ruffle feathers.

So, be careful. Do your own legwork. Protect yourself. Beware of pressure tactics and unstated loyalties. This is capitalism and the whole real estate sales industry exists for only one purpose - to make money for the real estate sales industry.
Click to expand...

I don't want to get down on Realtors, who are making a living like the rest of us (really, who among us are truly criticism-proof). That said, this post does honestly point out a problem with the commission system - namely that the point of diminished return for an agent occurs sooner than for a client (think the 94% / 6% ratio). If you want to read about it, pick up a copy of Freakonomics.

Also, for anyone thinking of buying a house, the two biggest insurance policies you can buy for a several hundred bucks are: 1) a home inspector that you choose, and NOT one recommended by your agent; and 2) an experience real estate lawyer that you choose and NOT one recommended by your agent. Perhaps I sound jaded, but having practiced this type of law for a decade, I have seen one of every type of bad behavior you can imagine.
 
Pjsmith said:
Also, for anyone thinking of buying a house, the two biggest insurance policies you can buy for a several hundred bucks are: 1) a home inspector that you choose, and NOT one recommended by your agent; and 2) an experience real estate lawyer that you choose and NOT one recommended by your agent.
Click to expand...

Agree wholeheartedly on point 2).

On point 1), I agree with the premise (do NOT choose one recommended by the agent), but I'll also point out that you have to do some due-diligence on the inspector. In many states the "state licensure" is worthless, there are so many holes in the contract and the law that the licensure is more a "promote inspectors" as opposed to ensuring competance or honesty. Ask around. The best inspectors are the ones used by commecial property owners and those employed/contracted by home relocation companies (in those cases, there is a strong incentive to nitpick and keep the price down). I still remember one real estate agent being really p.o.'d with me because I chose someone who was a registered PE and inspected commercial properties for a living - he did homes on the side. And he was tough.
 
wsuffa said:
The best inspectors are the ones used by commecial property owners and those employed/contracted by home relocation companies (in those cases, there is a strong incentive to nitpick and keep the price down). I still remember one real estate agent being really p.o.'d with me because I chose someone who was a registered PE and inspected commercial properties for a living - he did homes on the side. And he was tough.
Click to expand...
We've had a mixed bag. Seems like every time we've bought a house we've gotten a milquetoast and every time we've sold the buyer has gotten attila the hun.
 
Ken Ibold said:
We've had a mixed bag. Seems like every time we've bought a house we've gotten a milquetoast and every time we've sold the buyer has gotten attila the hun.
Click to expand...

Ain't that the truth.... One of the things I always told the client to do was to give the inspector a very clear understanding of what the client wanted, i.e. an honest and complete report on the condition. NOT an assessment of whether the house was 'worth it', or whether a defect was 'important' or 'not important'. Summary statements such as "the house looks like it's in pretty good condition" don't mean anything, whereas statements like "evidence of water infiltration on sill plate" do.
 
Maybe the first step should be to get you credit report & correct any mistakes... This can take a long time even if it is an obviously wrong item.

Then talk to a mort broker and give them a copy of your report with your SS # blanked out. Shop with you report copy & dont give out you social # to anyone. If 2 brokers, let alone 5-10 check you credit then you credit score can go WAY down.

Then if you credit is real good check you bank for rates against the brokers rates.

Then find a home.
 
All good advice... one other. Don't know if your local community college offers this, but ours did. A four week short course on real estate. It was geared to first time buyers and went through the whole process from beginning to end. Had guest speakers, real estate agents, mortgage brokers, lawyers, title insurance, home inspectors. etc. Well worth the nominal cost and really did give a novice lots of good information.

Gary
 
Eamon said:
Maybe the first step should be to get you credit report & correct any mistakes... This can take a long time even if it is an obviously wrong item.

Then talk to a mort broker and give them a copy of your report with your SS # blanked out. Shop with you report copy & dont give out you social # to anyone. If 2 brokers, let alone 5-10 check you credit then you credit score can go WAY down.

Then if you credit is real good check you bank for rates against the brokers rates.

Then find a home.
Click to expand...
Sure. And it'll take any one of them exactly 5 seconds to find my SS number elsewhere.

I intended to go to the bank where the plane is financed, which is in the area.

Does that really work to shop loans without them knowing the SSN? What happens when you use sites like LendingTree.com? How do they get banks to bid?
 
Yes, you can get a real close idea of a rate, but not a guarantee without a number.

If you shop 20 brokers with your SS#, you might wind up paying 8% fixed instead of 7%. Add that up over 30 yrs....

Only a real scum broker would order a report without your consent & by you not giving your number they do not have your consent.
 
New York just became the 25th state that allows you to "freeze" your credit reports. First freeze is free. You can unfreeze when you want to apply for credit. Then subsequent re-freezes are $5.

Check to see if your state is also one of the 25. If not, find out who your state legislator is.

- Aunt Peggy
 
An update: I ran into a buddy at a tech user group and I remembered he ha just bought a really nice house and had moved up quickly. I asked him for what he knew about home buying and he let me in on the world of buying foreclosures.

We went looking at houses Sunday. I found several that were acceptable to me and a lot cheaper than I thought. Being that I live in a gentrified neighborhood I was convinced that all houses costs more than they do, and more than mere mortals can afford.

I had called the broker he recommended who wanted me to qualify to be worthy of their time.

The mortgage guy called me this morning, ran a quick check and said I qualify! WOOT, Woot, Woot! I'm gonna be a homeowner! :goofy:

Not only that, he said he could arrange it so I could buy more house than I thought.

The real estate broker called me back really fast this morning. :rolleyes:

I still have a very hazy idea of what I want and where I want it. I will cool my jets until I spot a nice deal.

Now, of course, the plane is gonna need a major overhaul. :rolleyes:
 
mikea;137220 Not only that said:
Be careful about that one. The bank and the realtor want you to buy the most expensive home they can talk you into whether you need it or not. Buying the most house you can afford is a lot like buying the biggest fastest airplane that you can float a loan on. You need to leave something in the bank for the inevitable repairs and upgrades (not to mention new furniture). Also beware the potential for a big increase in property taxes over what's listed depending on how much the county has kept up with market values.

IMO you are better off buying the house that you need vs the one you can afford (if you have the choice). That way you might have something left to spend on flying.
Click to expand...
 
I agree with Lance. Set a budget and work toward it. I've P.O.ed more than one real estate agent by putting limits on. And I fired one when she insisted on showing me new houses when I said - 3 times - "no new houses".

There are rising defaults in the "no money down" or "buydown" mortgages these days. Be careful, because in many areas home prices are still falling. You don't want to be upside down.

You'll do great, though....

Congratulations.
 
lancefisher said:
IMO you are better off buying the house that you need vs the one you can afford (if you have the choice). That way you might have something left to spend on flying.
Click to expand...

Great advice! Back when we started looking, the bank qualified us for X, but we ended up buying a house for 0.4X. While certainly no showplace, it meets our present and future needs, and leaves plenty of cashflow left over for other enedvours. (say, like being a partner in a 201 :D :D :D )
 
Somebody please stop me! I'm about to make an offer on a place beyond my wildest expectations that's two turns and a mile or two from where the Cherokee sleeps.

I just checked that I could actually walk from there to the train station, too.

It's either gonna fall through or worse, it won't and I'll have to figure out what I did. :dunno:
 
mikea said:
Somebody please stop me! I'm about to make an offer on a place beyond my wildest expectations that's two turns and a mile or two from where the Cherokee sleeps.

I just checked that I could actually walk from there to the train station, too.

It's either gonna fall through or worse, it won't and I'll have to figure out what I did. :dunno:
Click to expand...
GO FOR IT! :rollercoaster:
 
Just got a phone call.


"Is this the new homeowner, Mike?"


They accepted my offer.



My reactions:

1) I'm gonna be a homeowner. :yes: :yes: :yes: It's gonna be cool! :rofl: :rofl: :rofl:

2) My god! What have I done? :hairraise:



Beer at the airport is gonna be on me! :cheers:
 
mikea said:
2) My god! What have I done? :hairraise:
Click to expand...
OK, relax, Mike. We experienced homeowners will now provide a list of mandatory supplies EVERY house needs. My list starts out:

1) plunger (there's a story behind this that makes it #1)
2) duct tape
3) ladder
4) basic set of tools
5) fire extinguisher

Furniture? Bah! My wife and I moved from a small house into a big one and had an empty formal living room for a while. We called it the ballroom.
 
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