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View Full Version : Seeking old guy wisdom



derekhonda
06-25-2009, 12:42 PM
So, just trying to pick your brain. As a few of you know I have been house shopping for about 8 months now, to absolutely no luck. Lately, I have just been putting in low ball offers like crazy, and randomly...always getting second place.

I'm single, have some change saved up, and very adaptable. I don't need to live on a golf course or in a certain school district, of course I am looking at these things for resale purposes, but overall, I am just looking to find one of those "deal of the year" houses that come along once in a great while, get it bought, live in it 3 to 5 years, sell it make some money, go bigger and better for a more "life long" house.

Anyways, I havn't been going the normal route when looking at a house, I have been doing bank forclosures, short sales, sherrif sales, and more recently hud houses.

Hud houses are a "secret" online auction. A house is opened up for 2 weeks, You look at it, then you place a bid online, and at the end of the two weeks, highest bidder gets it.

Here lately I have put in four offers.

house #1 listed at 89,000
put in a 65,000, sold for 72k, 2nd place

house #2 listed at 120k
put in a 102, sold for 110, 2nd place

house #3, listed at 15k (yes 15 k, great property just needed a ton of work)
put in a 17k offer (over list price) sold for 32,500, 2nd place

house #4 listed at 108k
put in an 88, sold for 111,500, second place


Now, I'm not sure who all caught onto the trend, but people here lately have started paying more than the list price on the houses to ensure they would get them. The thing is, those idiot way overpaid! On the last one, he technically could have purchased the house for $88,001, and now I recognize he did not know what I had offered, but he still over paid by about 20 grand.


To me, there are two scenerios taking place. People are feeling more confident in the market, are taking advantage of the low interest rates and the federal credit for the first time home buyers......or......they are idiots. They simply still don't realize that prices are so beat up they should not overpay for a house. You wouldn't walk into a ford dealership and go "oh that truck is great, and I see its only $40,000. If you will sell it to me right now, I will gladly pay you 50k."

My dad has been telling me that I ought to jus tkeep holding out, he keeps fearing the worst and says its just gonna crash and burn coming up and i'd be better off holding onto the money I have saved up. My dad has always been a very smart man financially in my eyes, And I sort of understand what he is saying, I'm just trying to see what everyone elses opinions are on the current housing market.

CNC_guy
06-25-2009, 12:57 PM
There are a lot of factors that play into what you're talking about and the thing is, nobody knows what the future holds. We've never been in a housing situation quite like this. If I were in your shoes, that 8,000 tax credit would make things a lot more tempting.


My plan was to build and sell, build and sell until I get the house I want and pretty much have it paid for. We built and sold one house and have now built a second house. I'm in no hurry to sell now and plan on staying in this house until things get better. Even then, we may still stay in this house and go a different route.

loons
06-25-2009, 01:01 PM
Just keep doing what you're doing. Eventually one will fall in your lap at a great price. People are doing the same here in So Cal, but at a much higher price. I paid $675,000 for my home 4 years ago, and now it's worth $500k if I'm lucky. And it will probably get worse. Luckily I never took out a second or got conned into a crappy loan. Eventually it will rebound, but I'd say you have another solid year of the kind of shopping you are doing. Around here people are getting homes for $200-$250k that are worth double that when the market is decent. But it takes them a year to actually find something because of all the bidding wars.

01 250exman
06-25-2009, 01:06 PM
Well my mother who works in the housing market has been saying it would crash for years and it did lol all so that it has not hit rock bottom yet so maybe your dad and my mom know something? And why not wait a little longer it's a big as investment to make it should not be rushed!

fastredrider44
06-25-2009, 01:16 PM
I'd say keep shooting the low balls and bid low. If you get a deal, you do, if it's not a deal, you pass it up and the next guy gets it. But get impatient, and you will be the idiot that just gave 20 grand too much. Just be patient.

jesseweaver
06-25-2009, 02:03 PM
Originally posted by fastredrider44
I'd say keep shooting the low balls and bid low. If you get a deal, you do, if it's not a deal, you pass it up and the next guy gets it. But get impatient, and you will be the idiot that just gave 20 grand too much. Just be patient.

took the words out of my mouth....

i would like to buy a house sometime next year too (i've heard numerous people say they will extend the tax credit. i think it ends in december? ill be 18 and able to buy a house in march. i've also heard from very knowlegeble people that there is a good chance that credit could be bumped up to 15k :D )

i'm hoping the market is still pretty low next year... i want to buy a house when im 18, rent it out and use what i have saved up, the tax credit and rent money to pay the bills for a few years, then maybe sell it when i'm ready to move out and buy a new house. then hopefully the markets back up, i can make money off the house, then i have all the rent money and have money for a decent house.

ZeroLogic
06-25-2009, 02:18 PM
Originally posted by jesseweaver
took the words out of my mouth....

i would like to buy a house sometime next year too (i've heard numerous people say they will extend the tax credit. i think it ends in december? ill be 18 and able to buy a house in march. i've also heard from very knowlegeble people that there is a good chance that credit could be bumped up to 15k :D )

i'm hoping the market is still pretty low next year... i want to buy a house when im 18, rent it out and use what i have saved up, the tax credit and rent money to pay the bills for a few years, then maybe sell it when i'm ready to move out and buy a new house. then hopefully the markets back up, i can make money off the house, then i have all the rent money and have money for a decent house.

How are you buying a house at 18!?

Kickstarts-suck
06-25-2009, 02:36 PM
Originally posted by ZeroLogic
How are you buying a house at 18!?

^^^^^^^^ x2

:huh

Wish I could even afford to move out of my parents house... let alone have my own place..

PhilMoore
06-25-2009, 02:50 PM
Be patient. The deals will be getting even better soon.

jesseweaver
06-25-2009, 03:11 PM
Originally posted by Kickstarts-suck
^^^^^^^^ x2

:huh

Wish I could even afford to move out of my parents house... let alone have my own place..

no i wouldn't move out, i plan on living at home until i'm married or early 20s. i'd rent the house out...


correct me if i'm wrong but with a first-time home buyer loan you don't need any money down?? or not much at least i think??

and right now you can get away with as little as 5% down payment some places... $80k house, $4,000 down. then... $8,000 in your pocket (tax credit) plus money from renting it out, plus during summer i work 70 hour weeks doing construction and during school i get about 30-40 hours in. shouldn't be too hard to make payments (i've been working full time over the summer since i was 13 and work almost full time during school since then, i have a decent amount saved up for being 17. and yea no payments really, cell phone, gas, and insurance thats about it)

derekhonda
06-25-2009, 04:17 PM
Well thanks for the responses, and I think I knew the answer deep down inside, it just sucks cause i really feel like i'm doing everything right, but yet still don't have a product for my efforts.
Hell, I know this towns real estate better than most realtors cause i go throgh about 20 houses a week.

Anyways, went through 6 more tonight, 5 crap, one dream house, man was it nice. Puttin in a low ball offer tomorrow after I run the parents through it, wish me luck.

KevinAb
06-26-2009, 10:37 PM
If you can, buy a place that needs work and do it yourself. I've bought, fixed up and sold a couple of my own places, and flipped another on the side. I just bought a place for 230k when other houses in the neighborhood have been on the market for 380-400, even in this market.

It needs a lot of work, but I can make this place nicer than the others for less than 30k, and get it done it a couple months. I'm a couple weeks into this one, but on-time and close to budget even though we keep adding things to do. Other buyers were too scared of the work.

I don't kill myself trying to do it all, though I could. I just know enough people who know people, and I can get it done.

The wife wants to live in this house, but if I could flip it.....

18 and buying a house? Wow. You'll be well off one day. I wish I woulda started at 18.