thinking about buying this home

[TechBoyJK]

I can afford to spend $100k max. I want a 3 bedroom 2 bath home with a walkout basement. I want the walkout basement because I want to run my home business from the walkout part, and have my personal life upstairs.

Anyways, in terms of layout, etc, I found a really good match. link to home

The only major problem is that is surround by apartments. The apartments are decent, not terrible, and the neighborhood around the apartments is pretty good. But the house itself is by all the apartments. When you walk out the back door, just beyond the backyard is another complex of about 8 apartment buildings. Since my dad and step dad both know how to build decks, I'm planning on building a deck off the backdoor with a privacy fence. That should block off my view of the backyard to just the fence, of which I can turn into a nice garden area..

Here is the thing. The house has been on the market for 6 months. It had a single owner, an eldery couple who built it back in 1953. The husband recently died, and the wife is in a retirement home. The children of the couple are trying to sell the home. Realtor has said she has shown the home about 40 times, but noone likes the location. I had my had, whom has built and remodeled homes before, take a walk through of it, and he thinks its in great shape. It needs carpet, the walls painted, and the main bathroom slightly remodeled (new tub, vanity, floor). It also needs its old fusebox electrical service replaced with a new 40 circuit box with ground fault breakers. (cause all of the outlets don't have grounds). We think it will cost about $10,000 to bring the home up to date the way I would at least want to start out in it in.

I'm just curious to see what anybody thinks.. bla

 

[iamwiz82]

My opinion, NEVER get the best home in the neighborhood. The value is dragged down.

I would not buy a house in a bad location. It will never appreciate in value.

 

[bctbct]

When buying a house you should think of resale value.

I would never consider even looking at a house in the middle of apartments...that is probably why its been on the market so long.


edit 10K seems on the low side unless you intend to do all that work yourself.

 

[chusteczka]

I think it depends on the type of people living in the apartments and if their lifestyle will impede on yours.
It also depends on the probability you may find something better for a price you can afford.

You only need one home. Take the time to find what you want. You will live in it for a long time.

 

[DaveJ]

I'm in a very similar situation. My house is on the last street right before two apartment complexes, and in 22 years of living here I've never had any major issues. I've got quite a bit of green space between my house and the apartments though since there's a bike path, city park, and drainage ditch directly behind my house. In my backyard I've got a decent-sized tree and some HUGE crape myrtles that provide some privacy for the house. If you can do something similar with a privacy fence and maybe some landscaping then I think you'll be OK.

FWIW, the street my house is on is mostly renters, and the houses were built cheaper than the rest of the neighborhood. IMO, if your neighborhood as a whole is good then you should be OK.

Dave

 

[TechBoyJK]

Originally posted by: chusteczka
I think it depends on the type of people living in the apartments and if their lifestyle will impede on yours.
It also depends on the probability you may find something better for a price you can afford.

You only need one home. Take the time to find what you want. You will live in it for a long time.

my friend lives next to the home i am looking at, and he said the apartmens are quiet, it is mostly older people, i noticed that most of the cars parked their are nice (some bmw's), and he said he has never really noticed or cared about the apartments. The thing is, this might be the only way I can afford this nice of a home, to get it in the location its in. I'm also thinking I can negotiate pretty hard on the price since its been on the market a while.

Part of my reason to buy a home is so I can consolidate my debt into the mortgage. I owe about $14k in credit cards. My aunt is giving me $10,000 for a down payment, and thats the only way i can get the money. She won't give it to me for anything else. So I'm planning on buying a house and then using what equity I have against a debt consolidation loan, which will then improve my credit and allow me to refinance the house at a better rate.

 

[chusteczka]

Originally posted by: TechBoyJK

Originally posted by: chusteczka
I think it depends on the type of people living in the apartments and if their lifestyle will impede on yours.
It also depends on the probability you may find something better for a price you can afford.

You only need one home. Take the time to find what you want. You will live in it for a long time.

my friend lives next to the home i am looking at, and he said the apartmens are quiet, it is mostly older people, i noticed that most of the cars parked their are nice (some bmw's), and he said he has never really noticed or cared about the apartments. The thing is, this might be the only way I can afford this nice of a home, to get it in the location its in. I'm also thinking I can negotiate pretty hard on the price since its been on the market a while.

Part of my reason to buy a home is so I can consolidate my debt into the mortgage. I owe about $14k in credit cards. My aunt is giving me $10,000 for a down payment, and thats the only way i can get the money. She won't give it to me for anything else. So I'm planning on buying a house and then using what equity I have against a debt consolidation loan, which will then improve my credit and allow me to refinance the house at a better rate.

Given your situation, along with the assumption that it meets your needs, then this home appears to be a good purchase. I do not see anything negative about this home or the apartment complex behind it and you did receive a trustworthy mechanical evaluation of the home. This could be the situation for you and your needs that will allow you to purchase a home.

The one thing that concerns me is the credit card debt and how that factors into this. It is important to curb the spending that resulted in the $14k debt. It is good you are able to purchase a solid asset like a home.

I am not a mortgage expert but if you intend to refinance your home within a few years, it may be advantageous to purchase an adjustable rate mortgage, like a 7 year ARM, that will provide you with lower rates for the first few years, followed by a percentage rate increase later. This will provide for lower mortgage payments the first few years and will allow more money to be put into paying off the credit card debt. Very little of the loan principle will be paid off during this time but sometime in the first seven years you will be able to:

1. sell the home and move elsewhere after the credit card debt is paid off, or
2. refinance the loan for better terms like you mention.

Refinancing the mortgage loan will incur further fees. Plan now for the best payoff later.

My experience with a 30 year mortgage for $100,000 is that $95,000 of the principal remains after 6 years of payments. If I was to refinance now after 6 years of payment, the new loan would be for nearly the same amount as the original. Especially after the administrative fews for the new loan.

 

[TechBoyJK]

Originally posted by: chusteczka

Originally posted by: TechBoyJK

Originally posted by: chusteczka
I think it depends on the type of people living in the apartments and if their lifestyle will impede on yours.
It also depends on the probability you may find something better for a price you can afford.

You only need one home. Take the time to find what you want. You will live in it for a long time.

my friend lives next to the home i am looking at, and he said the apartmens are quiet, it is mostly older people, i noticed that most of the cars parked their are nice (some bmw's), and he said he has never really noticed or cared about the apartments. The thing is, this might be the only way I can afford this nice of a home, to get it in the location its in. I'm also thinking I can negotiate pretty hard on the price since its been on the market a while.

Part of my reason to buy a home is so I can consolidate my debt into the mortgage. I owe about $14k in credit cards. My aunt is giving me $10,000 for a down payment, and thats the only way i can get the money. She won't give it to me for anything else. So I'm planning on buying a house and then using what equity I have against a debt consolidation loan, which will then improve my credit and allow me to refinance the house at a better rate.

Given your situation, along with the assumption that it meets your needs, then this home appears to be a good purchase. I do not see anything negative about this home or the apartment complex behind it and you did receive a trustworthy mechanical evaluation of the home. This could be the situation for you and your needs that will allow you to purchase a home.

The one thing that concerns me is the credit card debt and how that factors into this. It is important to curb the spending that resulted in the $14k debt. It is good you are able to purchase a solid asset like a home.

I am not a mortgage expert but if you intend to refinance your home within a few years, it may be advantageous to purchase an adjustable rate mortgage, like a 7 year ARM, that will provide you with lower rates for the first few years, followed by a percentage rate increase later. This will provide for lower mortgage payments the first few years and will allow more money to be put into paying off the credit card debt. Very little of the loan principle will be paid off during this time but sometime in the first seven years you will be able to:

1. sell the home and move elsewhere after the credit card debt is paid off, or
2. refinance the loan for better terms like you mention.

Refinancing the mortgage loan will incur further fees. Plan now for the best payoff later.

My experience with a 30 year mortgage for $100,000 is that $95,000 of the principal remains after 6 years of payments. If I was to refinance now after 6 years of payment, the new loan would be for nearly the same amount as the original. Especially after the administrative fews for the new loan.

thanks for the advice. credit card spending has been curbed. I tried to start a business about 5 years ago, and after a long string of mistakes, lol, sigh, I ended up with $25,000 in credit card debt. I paid off $9,000 so far. The $14,000 left is on a single card, and its in collections. That is the only bad mark I have in the past 4 years. It is keeping me from getting good interest on anything. I can't use my aunts $10,000 to pay it off, but I can use it to buy a home, and use that equity towards a debt consolidation load that will get the credit card debt off my record. Once I get that debt off my record, my credit score will go up about 120 points and get me out of the sub-prime profile, taking about 3% off what I can get on an interest rate on the house. Having discussed this with my lender, we figure I can save approx $300 a month in interest alone once I refinance. I can the also refinance my car, etc.. since I have better credit.

That said, I'm not really looking for a discussion in that. I'm just looking at the home and if I should consider buying it.

 

[Vic]

Wow... $96k...

Anyway, I would advise getting a modest home in a nice neighborhood rather than the nicest home in a bad neighborhood. Location, location, location.

 

[TechBoyJK]

Originally posted by: Vic
Wow... $96k...

Anyway, I would advise getting a modest home in a nice neighborhood rather than the nicest home in a bad neighborhood. Location, location, location.

what about the price has you confused? i know in other parts of town a house like this would be going for $125-$140k

its not a "bad" neighborhood per se, but the fact that its surrounded by apartments in a decent neighborhood. I need this quality of home, and with what i can afford, the only way I can get one is to go with something like this.. im hoping to get them down to $80-$85k...

 

[allisolm]

Have you checked to see if local ordinances will allow you to run a home business from that location?

 

[TechBoyJK]

Originally posted by: allisolm
Have you checked to see if local ordinances will allow you to run a home business from that location?

yea i can.

 

[SearchMaster]

It sounds like a pretty good decision to me. You would be putting money that would normally be rent in someone else's pocket into your own, add in the tax benefits and the possibility of having a roommate that would add even more income...plus your aunt's "free" 10K would offset your realtor's fees when you decide to sell it. Even if it never appreciates, I doubt it will depreciate at all, meaning you should come out ahead if you stay there just a few years.

 

[DrPizza]

Originally posted by: chusteczka
I think it depends on the type of people living in the apartments and if their lifestyle will impede on yours.
It also depends on the probability you may find something better for a price you can afford.

You only need one home. Take the time to find what you want. You will live in it for a long time.

I purchased a house in a neighborhood that had a LOT of apartments. 5 years later, a couple of the apartment buildings were sold to someone else. The quality of the tennants went down considerably. The neighborhood went to hell. People who tried to sell their homes in the neighborhood found themselves unable to. Two duplexes went from renting to decent families to welfare families; then as the places were destroyed on the inside, they went from families on welfare (nothing against the welfare system - there are a lot of people who use it temporarily and get back on their feet. These were the types of people who scream housing discrimination, and had no respect for other's property) to crack houses.

I now own a house in that neighborhood. The character of the neighborhood goes up and down, depending on who's renting the apartments, but the reputation of the neighborhood makes just about impossible to sell a house. My advice: stay clear of neighborhoods where the vast majority of places aren't owner occupied dwellings.

 

[DainBramaged]

TechBoy,

While I have never purchased a house, I know a friend how bought a very nice house for an AMAZING price in a semi-decent neighborhood, as you are doing. He paid $55,000 for it. Three years ago, he got a better job offer in the Chicago suburbs and moved his family into an apartment there. He still has not sold the house and he has it on the market for $40,000 just trying to get rid of it. He also put around $8000 worth of work into it.

Just something to think about.

 

[NoShangriLa]

Originally posted by: iamwiz82
My opinion, NEVER get the best home in the neighborhood. The value is dragged down.

I would not buy a house in a bad location. It will never appreciate in value.

I use to think on the same line as you, but there are exceptions to the rule.

However, I wouldn't buy a house that is surrounded by apartment, because I might as well be living in the apartment/condo. Is more of a privacy issue than momentary gain issue.

 

[mb]

Might not be that bad if you can build a decent fence.

 

[Minjin]

Pick it up and don't worry about the location. Offer them no more than 80k. I think you might be surprised at how low they will go. I bought my house from people in a similar situation (clearing out an estate) and I lowballed them with an offer 20% less than asking. They took it. Then I made them lower it even more with seller concessions. If you find you don't like the house or want to move, you can always rent it out and maybe make some bucks.

 

[TechBoyJK]

Originally posted by: supafly
Might not be that bad if you can build a decent fence.

yea, i can build a deck around back, and for the tall apartments near by, one decent size tree would obscure the view..