What advice would you give to a first home buyer?

[LynneSin]

I'm really getting close to possibly buying myself my very own place. I know home ownership has its benefits but I have to confess that I loved the carefree living of apartment living - if it was broke you didn't have to worry, someone would fix it.

So here's your chance of sharing your words of wisdom to help out a future first time home buyer!!

Thanks!

[Gormy Cuss]

1. Treat your home like a car.

Just as your car will perform better and last longer with regular maintenance, so will your home. If the appliance or system manual suggests some routine cleaning or tuneup, do it. Understand the typical useful lifespans of appliances and systems and plan to have the money to repair or replace them when they're getting old. That way you won't be caught short on cash every time something needs to be fixed.

On the fun side, you can paint the walls any color you like now. You can put holes in the walls to hang stuff as much as you want.

[NewJeffCT]

2. good luck

1) Do your research first. Find out about the area (or areas) where you want to buy and get an idea of the housing market there and how much you can afford to pay.

2) be patient. Since you're in an apartment, you probably don't have pressure to move right away, so don't settle for something you don't want.

3) In terms of long-term value, it's better to be the worst house in a good neighborhood than the best house in a bad neighborhood.

4) If there is any open space/area near the house you want to buy, check out how it is zoned. You don't want to buy a home and then find out that Wal-Mart is going to build across the street next year.

5) Make sure you get a home inspection after you decide to buy a home. Even a brand-new home may have issues that come up under inspection. Be particularly aware of older homes that have not been updated - you don't want to buy a 40-50 year old home that is in dire need of a new roof and/or a new furnace. Or worse, the roof may be okay for another year or two, but you'd then have to spend $8,000 for a new one after that...

6) If the home is older, check out what has been updated - are the windows original? how old is any of the carpet? Is the tile floor in the kitchen or bathroom new or old? If the home has a basement, check to see if there is a musty smell down there that could indicate mold. They are all big potential expenses down the road.

[Crazy Dave]

3. Visit the neighborhood on the weekends

Crime stats are pretty well known throughout town and you'll never get totally away from it. The crooks actually target the upper-middle class neighborhoods more.
The most important thing that I can advise being in development and in an industry closely tied to home sales, and owning two homes myself is don't use the so-called "Buy or Sell Yourself" or any other type of bargain gimmick. Used a licensed real estate broker who works for you, not the seller, you'll get protests from them and if so walk away, your broker and their's have to split the commission so usually the one representing the seller wants it all. Hire a building contractor to do a home inspection versus the home inspector agencies in the phone book. Even if you hire them they're still dependant on real estate brokers for 99% of their business and if they screw up too many sales by pointing out deficiencies the word gets around town and the brokers will use the ones recommended for giving the green light all the time. They have no liability for mistakes or oversights. You are partially protected under disclosure laws but it's hard to prove the previous owner knew about structural and code issues with their home. The home buyer's warranties are pretty useless too. Last but least, get a real estate attorney to look everything over especially for liens that you will inherit. It's really not a lot (an extra $2000 - $2500) in the whole picture and the total price of the home but you'd be surprised at how many people think it's a great thing to save the $2000 only to find out two to five years later have to spend $10,000 or more on issues that a realtor, a licensed building contractor or attorney could have protected them from.

Good luck! Oh and I almost forgot, make sure your kitties like the place that will actually be their's and you just get to live with them and pay the mortgage. :hi:

[mikeytherat]

5. Gotta second the "home inspection by a BUILDER or ENGINEERING FIRM,

NOT a 'home inspection' company" advice. For all the homes we have bought and sold, we used an architectural and engineering company to do the inspection. It costs about 3-4 times what a BS home inspection costs, but we get a total engineering analysis including the construction of the home, the quality of materials used, lot perk/drainage issues, etc.

My mom and dad were real estate brokers, and I was present for more than one home inspection that was an absolute joke. One time, an inspector missed a BIG HOLE IN THE CEILING (about 12" in diameter) until I pointed it out for him.

mikey_the_rat

[bleedingheart]

15. I will "third" this as well...

"home inspectors" are not always what they seem to be...

Better to get an architect or a civil engineer to look over the home..

I was going to buy one home until the architect told me that the siding was all asbestos...and that while it could be painted...anything that would require cutting into it or repairing it would cost a fortune...

[Crazy Dave]

20. And....

I forgot to mention this before but we put into the contract for my 50 year old house, that for the needed repairs that were discovered, that only a licensed building contractor, not the homeowners, not their brother-in-law, etc. do the repairs. Or take $5000 off the selling price which after them bickering for two weeks and with me promising to walk away from the deal, they agreed to and I hired my own builder for the serious stuff and fixed the easy stuff myself. Spent all or more of that $5000 quickly.

[AllegroRondo]

4. we just bought a house 2 years ago

so I'll give what advice I have

If you're buying an existing home, get a home inspection. You can make an offer contingent on the inspection, so if the inspection does poorly you can re-do the offer or back out entirely.

If you are looking at a home in a subdivision, read the subdivision rules carefully. Talk to the neighbors and see how the place is run, and how well the rules are followed.

Get the fixed mortgage. The bank will try to talk you into an adjustable, but right now is not the time to get one.
Put as much into the down payment as you can. If you have more than 20% down you dont need mortgage insurance. Many lenders can also work with you to do an 80/20 loan, where your primary mortgage is 80% of the homes value, and you get a second loan at a slightly higher rate to cover the rest - you avoid the mortgage insurance this way.

I would recommend working with a real estate agent, especially if you are not familiar with the area or have limited time. They do more than find the house, a good one will help you negotiate price and other details.

[LynneSin]

16. Already pre-qualified for a fix rate

I work for the company that'll have my mortgage - they won't even bother with variable rate

[Nickster]

6. Get yourself a real-estate lawyer. They usually charge a flat rate and they

will go over all the paperwork for you and with you. It made me SOOOO much more comfortable about taking the plunge. It only cost me about 200-300 bucks, I don't remember the exact amount, but he was right there and basically read every page to me and explained the meanings, etc.

[kay1864]

7. Aren't they a normal part of closing?

I've bought 5 houses, and the closing was always at the real estate attorney's office, and he/she conducted the proceedings and explained all the documents--to both buyer and seller. Didn't know there was any other way.

[Gormy Cuss]

12. Oddly enough, in some areas the transaction is done without an attorney.

In California the title company handles the closing as a rule. We had an attorney and were told that only people from the East think an attorney is necessary. I had never heard of closing without one when I lived in Massachusetts.

[Nickster]

18. Interesting. I guess I didn't realize that the transactions were handled differently

depending on the state. In Illinois, the title company handles the closing and you get a rep from the seller and a rep from the buyer at closing. No lawyers involved unless you bring one, I did. The title company "closer" just wanted me to "sign here", "sign here".....

[kay1864]

19. Until today, I didn't either!

"Sign here, sign here", with no explanation?

:scared:

[Nickster]

21. That's what they wanted to do, but my lawyer took over the paperwork and started

explaining everything and demanding changes here and there as appropriate. I didn't sign anything until he got everything just so and I understood what he was telling me. If I had gone in alone, they'd have pushed the papers at me and handed me a pen and said "let us know when you're done".

[Sanity Claws]

8. Take a vow of poverty

Yes, your house will most likely appreciate in value so you will be asset-rich but cash poor. When you have to choose between a new hot water heater and updated wardrobe, you will have to choose the hot water heater. It won't be long before you look like a mom, even if you're not one!

[madinmaryland]

9. A couple of things.

ALWAYS get a home inspection!

Make sure you have a good attorney. This came back to bite us when we sold the house. Our attorney when we bought the house did not follow-up with the paperwork, to make sure the sellers attorney filed the proper paperwork. When we went to sell the house a couple of years later, it will still titled to the previous owner. He had screwn up the paper work.

Always have a title search done.

[kay1864]

11. Also, check your county's online tax records once or twice a year

A year after we bought our house, the couple we bought it from got divorced (in another state). For some crazy reason they filed a quitclaim deed--to a house they no longer owned!

So although we were on the tax records as the owners for the first year we were there, the second year it showed them as the owners (typical screw-up for our county government). We got it cleared up with a phone call, but it might have caused problems if we hadn't checked in the first place.

[Raven]

10. Get a pest inspection too. The three most important things have

been covered here: home inspection, pest inspection and getting a RE lawyer. Most, if not all, purchase agreements will allow you to make the deal contingent on the inspections. You want language that says you can walk from the deal and get your deposit back if, you, in your sole judgment, are not satisfied with the inspection results. The other thing that an inspection contingency does is allow you to renegotiate the sale price. Say, for example, the inspection indicates that you need a new roof at a cost of 5K. You can go back to the seller and try to get the price reduced by that amount. Good luck!

[SmokingJacket]

13. Buy the dumpiest-looking house in the neighborhood.

BUT only if it just looks that way and it is a solid building. Look past the peeling paint, lack of landscaping, ugly linoleum, old fixtures, and other things that are easy to replace.

We bought an "ugly" house in an upscale neighborhood ten years ago -- by far the cheapest house on the block. We painted it in tasteful colors, put in some nice flowering plants, ripped out the crappy bathroom, and now we're selling it at a price equal to those around it -- and really, we hardly put any money into it at all. It was the smartest purchase we ever made.

[kay1864]

14. Most of all, take your time

Any time you go house-hunting with your realtor, you're looking at a snapshot of what's on the market in your price range at that time. If you see something you fall in love with, move on it, make an offer, get an inspection, etc. Especially if the area you're in is a seller's market (your realtor can tell you if it's a seller's or buyer's market right now).

But if you don't find a house you really like, don't let your realtor pressure you. Wait a week or two or three and see what else comes on the market.

Either way, if a house interests you after the initial walk-through, take pictures! You'll see so many that they'll all be a blur after a whole day of looking. Pictures help you remember "oh yeah, that one".

Also, very important: write down your impressions (good and bad) while you're there, preferably on the sales flyer most houses have. Again, you'll be looking at so many that you'll need these reminders later.

[DrDan]

17. do not overextend yourself

Just because you can spend 28% or so of your takehome on a mortgage - and because the real estate agent will be pushing you as far as you can go - remember - you can go for less house and have money for upkeep, improvements, other spending.

I suggest a larger downpayment to keep monthly mortgage payment lower.

Be careful when a homeowner association is a part of the deal. There can be some strange bylaws (no outdoor speakers, no flags, no trucks parked in the driveway, children's play equipment cannot be left out (even swings etc), type and amount of landscaping, limitations on home exterior changes, color of the house, etc) - make sure you can live with them. Read them very very carefully before committing.

Keep up with repairs. There will be plenty - and they tend to stack up. But they will not go away if ignored. And items like wood rot can only get worse bringing in damaging insects and further rot.

Areas where you can get yourself into trouble fast - electrical and plumbing repairs. Unless comfortable with these, let an expert do them. Areas more forgiving - painting and landscaping.

[TrogL]

22. Check the roof, windows, furnace, wiring, plumbing and hot water heater

Other things to check:

• water stains in basement
  
• bulges or stains in finished basement walls
  
• cracks in foundation
  
• for termites or previous infestation
  
• mildew anywhere - for all you know the house contained a grow-op and it's in the walls
  
• septic tank
  
• that everything drains properly inside and out
  

Also make sure the wiring is up to current code. In some places if it isn't and the city comes along and inspects later, you have to bring it up to code at your expense. In my area the older houses were 60 Amp service and they want everything 100 Amp. If you do it at time of purchase, the city has to do it. Otherwise you have to pay them to string the new wire. Also make sure it's 3-wire all the way back to the panel, otherwise you have to rip out walls.

[northzax]

23. rent

:)

[flvegan]

24. Do your own investigative title search on any place you have interest in

You might be able to make a more informed decision. Ultimately, it's like making a "Carfax" for your home. Granted, not all things show up, but you'll be able to:

*See if the place is in, or ever was in foreclosure
*See what kind of mortgage(s) are in place already
*See that pesky Notice of Commencement that says "Repair fire damage"
*See any previous or ongoing Code Enforcement issues

I did this with ever house I was interested in. I'm in the title biz, so it was easy for me, but you can also do this for free yourself.

For example, if you're looking in Wilmington, go to the New Castle recorders website and run the names of the owners (and previous owners) and see what you find (get the names and the legal description from your property appraiser website).

If you need any help with it, feel free to drop me a PM.

[jmowreader]

25. Some things you DON'T want

* Polybutylene plumbing. It's a plastic that chlorine eats. We of course didn't KNOW this until the plumbing started failing. Remediation involves tearing all of it out and replacing it with either copper, PVC or PEX. (PEX is crosslinked polyethylene. They tested it by throwing pieces of it in Clorox and leaving it there for years--with no reduction in strength. This is good pipe.) Polybutylene can be gray, blue (the two most common colors), white (PEX is white; PEX usually isn't) or black (ABS is black; PEX usually isn't). Polybutylene and PEX are both connected with crimp-on copper rings--so if you run across pipe that's white and has crimp-on rings it's one or the other...but PEX always says it's PEX on the side of it.

* A Federal Pacific breaker box. Sometimes the breakers don't trip in response to overloads. Lots of house fires have started this way. Remediation calls for replacing the panel.

* Aluminum wiring. When they started using it they tried using the same gauges in aluminum they used in copper--12AWG for 20-amp service, 14AWG for 15-amp service. After some homes burned down they realized you have to go one gauge larger. Then we ran into wires loosening, galvanic corrosion, all sorts of weird shit. Just know that if there's aluminum wiring in the house, it's probably gonna burn down. (Fire and Water Restoration is a popular trade in Fayetteville, and we sell to many of the companies doing it. I got sent out to measure a home for drywall and insulation, and met a fire department investigator. Apparently they thought it was arson because the home caught fire in a "suspicious manner"--basically, the fire started in every room in the house at about the same time. Arson didn't make much sense to me because the homeowners were going to move back in after the remediation--and most people wouldn't burn their house down to get new carpeting. So I'm walkin' through with her, measuring and logging, and asked if the home had aluminum wiring. (She's looking for accelerant traces--which you would normally have in an arson.) "Why?" 'Well, I'm standing here counting all the electrical boxes so we can bid out the materials, and they've all got char marks above them...and the char marks seem to all be about the same height.' "If you've got a screwdriver, hand it over." Every electrical device in the whole house failed at exactly the same time.)

* Two-prong outlets. These days, a lot of really juicy stuff needs grounded outlets--computers in particular. Two-prong outlets mean either the center screw is grounded (which means you get to replace all the outlets with three-prong ones) or there's no ground to the box (which means you get to rewire).

* Resilient flooring in a house built before 1985. It's got asbestos in it.

* Black streaks on the roof, or curled-up edges of shingles. Usually a new roof is called for.

I'd buy a house that had all those faults...as an investment, for not very much money, and then I'd gut it and redo everything. If you want to LIVE in the home, try something that doesn't need $25,000 worth of repairs.