Tasteful Friends, should I consider buying this house?

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How can you lose for that price? It looks big and bright, and you can fix it up to your tatse without too much expense.

Is 10 percent down the norm?

I think Suze would want to know about your other debt obligations but I’m pretty sure she would say: YOU ARE APPROVED!

If you don't want it, I'll take it.

Oh, duh, R4. Sorry...

$8k in credit card debt (pay more than minimum monthly each mother)

$85k available credit

Student loans paid off

Biggest current monthly expense is rent on 2BR apartment (with utilities, insurance etc.): $1500/mo

Salary low-mid 100ks (bonus opportunity means it can vary slightly, but always at a base in low 100ks)

Obviously, those aren't my only monthly expenses, but they're my only monthly debts.

Do it! But definitely get rid of that piss poor "island" in the kitchen and replace it with some mega island like you see on HGTV

i like it, a lot and the price is good . what's the neighborhood like?

Out of curiosity, with that salary why don't yu pay off your credit card debt? Interest is ridiculous...

Love it.

I think I saw this house on a Dateline episode.

R8 - this is boring, suburban Northern Florida. The neighborhood is okay. It's close enough to some (relatively... because it's all relative in North FL) cooler neighborhoods with better restaurants, amenities and culture. It's a 20 minute commute to my office. It apparently has a good school district from what I can tell and on the lower third of crime rate for city. It's definitely got some shabbiness -- some homes in the neighborhood, like this one, are updated and some definitely haven't been updated in decades and could use a landscaping makeover. In nicer, higher end neighborhoods here, from what I can tell, it could be listed for as much as $100k more.

R9 - I dunno. Maybe I should. But now that I've started to think about the possibility of home ownership, I'm trying to keep as much cash on hand as possible. And given that my credit usage is less than 10% of available credit, I think I'm okay to do that for now.

Although the mortgage payment would be less than my current rent, there's the down payment and the expenses I, as a lifelong renter, haven't had to deal with before -- maintenance, garden, property taxes and home owners insurance etc. So... for now, thinking about not dropping a lot of cash to pay down those cards.

This probably sounds like a no brainer to some of you, but even though I've been here two years, I'm still a California guy at heart and home ownership was never in the cards there for me. So, the idea of making this kind of 15-30 year commitment is still a bit of a mindffuck. But, here, it's the norm. Colleagues of mine in their early 20s own condos and houses. In fact, out of the 200 or so colleagues at my office, I think I'm one of only 10-15 renters.

From what I've read, property values in this area have been going up steadily over last 3-4 years. According to records, when this house was bought (pre renovations) in 2017 or '18, it was sold for $150k.

Not a time to buy. The market will change rapidly soon. You may have better opportunities and this neighborhood may change if neighbours have to move because they are defaulting on their mortgages. Sounds like you can wait a year and see what the lay of the land will be at that time.

pools are a pain

What R13 said. Expect home prices in most areas of the country to decrease by 50% or perhaps more by next year with this pandemic in play. Great house though. What city exactly? That might help. I have family in Tallahassee, St. Petersburg/Tampa and Port Saint Lucie so I know those areas relatively well.

R15 - Jacksonville.

I think I felt a slight sense of urgency with this one in that it's not typical for listings I've seen here in terms of the size (nice, but not massive -- 90% of the time it will just be me here), but with a pool, updated so not requiring major costly refurbishments, not a cookie cutter housing development house. (But, I also have to remind myself not get swayed by the staging)

But, shit, if prices really could fall that much in a year, it does seem wise to wait.

Can anyone recommend a source on how much property prices fell after the Great Recession? Of course, I understand this is not a typical economic downturn or recession and the after effects may be unique to this pandemic, but that might be helpful context.

The beams are rotten Feng Shui.

Diane Arbus came back from the grave to do the photo shoot.

OP, how secure will your job be in the economic downturn that everyone's expecting? How is the region you live in likely to be affected? Are there key industries in your area likely to be affected by the pandemic, are thousands going to be thrown out of work?

Because yeah, I like the house, but if you have financial troubles or the neighborhood goes downhills, this will not prove to be a good idea.

[quote] Estimates are that mortgage payment on even a 15 year would be less than my 2 BR apartment.

Just remember OP that with home ownership there are always things that are going to need fixed and upgraded. As long as you feel you can afford it, I would go for it. However one recommendation. Get a 30 year loan and then make double or even triple payments if you can, if something unexpected happens like you lose your job or get sick, you can make single payments until things straighten out for you. Buying a house was the best thing I ever did, paid it off in 9 years and lived in it for 25 years total 16 years with no house payments.

So, this is interesting. I didn't realize that one of the impacts of the Great Recession was actually an INCREASE in housing prices....

[quote]The subprime mortgage collapse caused many people to lose their homes, and the fallout created economic stagnation. Americans faced financial disaster as the value of their homes dropped well below the amount they had borrowed, and subprime interest rates spiked.

[quote]Monthly mortgage payments almost doubled in some parts of the country. In most cases, borrowers were actually better defaulting on their mortgage loans rather than paying more for a home that had dropped precipitously in value.

[quote]In turn, homebuilding saw a significant decline restricting the supply of new homes for a steadily growing population. The lack of supply and the increased demand created a seller’s market in the real estate industry. More people were now chasing fewer homes, which increased home prices.

You lost me at “Northern Florida”.

What year are you talking about? Home prices dramatically decreased and that is why you had so many people default on their loads. They either did a short sale or foreclosure. And those homes that became available were well below what the homeowner payed.

The problem with Florida real estate is home owners insurance and property takes are high. I would never invest my money in Florida real estate not only because of those two factors, but because of the flooding of neighborhoods and water oozing out of the streets.

You buy it at 200K and one year later it may be worth 150K.

It's a lovely house. This is not the right time to buy. Never consider any one house a once in a lifetime opportunity (not saying you are doing this). If you fall in love with a house, you lose the ability to negotiate.

Your finances, in general, are in order but there is no excuse ever to have credit card debt or make only minimum monthly payments.

Too much risk right now. Wait.

I hate the kitchen. Microwave is oddly placed and there isn't enough cabinet space. I think you could find better. I would wait

It's a nice house, looks really clean. If you like it, buy it. Prices may drop in a year but they will go back up again.

Also, don't think about the long term commitment, think of the protection from eviction or raises in rent. People buy houses and move within a few years all the time. Stay long enough so that if you sell sell you'll get your investment back and equity if the market improves.

I would not be buying a house until the bottom. We are just starting the descent into collapse land.

It's a lot of house for that price, but I wish the owners hadn't succumbed to Home Depot counters, cabinetry, etc. and embraced its exterior charming Sixties-ness. I like the bedrooms (well, not the curtains, but that's an easy fix).

I like it, and it’s a great deal at that price.

If you think you’d be there for at least 5 years, I wouldn’t worry about waiting to buy something cheaper in a year or two.

If colleagues in their early 20s are homeowners, then that says something about overall prices in the area. Sounds like you don't really love the area, so I think you can wait and see what happens to the market.

If you have 12 months of living expenses saved (like you said at OP), then I would use $8K to pay off that credit card debt.

What kind of job do you have? Is it stable through this economic crisis?

Yeah, it’s crazy to just pay the minimum on the credit card debt. Too much of it goes to paying off the interest and not the principal, and it takes forever to pay the $8k.

I’d make payments at least 3 or 4x the minimum.

After the crash of 2008, house prices went down drastically and many people were underwater on their mortgages, that is, the mortgage was for $250,000, house was worth $150,000. People defaulted on their houses in huge numbers and walked away. Stupid, because now those same houses are back to about $280,000. But it took ten years.

But at the same time, the job market was wiped out and a lot of people relocated back where they came from.

I’d ask, what if you lose your job? Do you have a secure position? Could you find another similar position? California recovered financially a lot faster than a lot of other places last time. There’s more of a depth and breadth of different kinds of jobs. Newsom seems to have a good handle on things there.

My advice would be, pay your credit card debt. If you lose your job you can’t afford to pay it and your credit will be ruined. Next, don’t buy. If you lose your job you won’t be in dire straits immediately. Also you can relocate easily by just walking away. In 2009, nobody could sell their house, the market was nonexistent. What if you lose your job in Florida, can’t find another and have to move?

I wouldn’t make any major purchases for at least six months and probably a year. You need to see how bad it’s going to get.

In Nevada, there were tons of foreclosures and people were pouring concrete down the drain holes and ripping the sinks off the walls. It got so bad, banks were paying people relocation fees to get them out with the house intact. And people broke into vacant houses and either squatted or trashed the place. Losing their houses brought out the worst in people.

If you do buy later, get the house inspected thoroughly and make sure the plumbing or electrical hasn’t been ripped out. People were ripping out copper pipes and wiring to re-sell for money.

I do remember Florida got hit very hard, I don’t remember why. A lot of people walking away.

Thank you, R35, and everyone else. Although I J'ADORE pointless bitchery, I really appreciate all of the thoughtful responses. I know I can't just rely on feedback from strangers on the internet and that there's an exception for every rule and, to quote every ad in the world right now, these are "unprecedented times," but you've all certainly given me a lot to think about. Because no market is identical, I am actually asking some of the Veeps at my employer (who are pretty well connected in the local community) if they know any experts in the area's economy or real estate market who might be willing to answer a few annoying questions for me. Historical context on how the area (not just the overall state or region) fared in response to prior economic downturns may be helpful context.

In the meantime, I've signed a waiver so that I can (with mask and a pledge to have washed my hands) at least go view the house this weekend!

Oh, and, R34, I don't pay the minimum on credit cards. I pay at least $100 more than the minimum on each card every month. But, R35 made a good point about paying the credit cards off now while I'm gainfully employed in a well salaried position. I'm fortunate enough that things are very stable in my company and in my department. I've been with the org about 2 years, but they've literally never had a single layoff in the nearly 30 years they've been in business. But NOTHING is guaranteed. I went through three layoffs during the Great Recession, so I know first hand! Cheers!

It's haunted

As above posts have said - now is most definitely not the time to buy. You may get some incredible deals in 12-18 months. There is a very strong probability the value of your house will collapse and you will be underwater for the next 5-7 years and can't move anywhere else because you will take a loss. Who knows what financial situation your neighbors are in? They may lose their jobs and then your value will deteriorate even more as they sell at any price to get out.

Pay off all of your debt and start building a bigger nest egg. If you want to live in a house, consider renting one with a pool. You'll probably be able to get one in the next year or two - see how it sets with you.

Just don't give into the 'feeling' - a house is an investment and you shouldn't let emotion override your decision.

[quote] Oh, and, [R34], I don't pay the minimum on credit cards. I pay at least $100 more than the minimum on each card every month.

OP, I don't want to beat this into the ground.

But this $8,000 credit card debt. Not sure what the minimum is, but let's assume that you pay $200 per month. $8,000 divided by $200 is 40 months (3 years + 4 months). That's not even considering the interest that continues to accrue.

I'm not saying you'll always be paying ~ $200 per month, but I hope you get the point.

I like it. But that island in the kitchen placed on the slant like that, it's of the Devil.

I've bought 4 times--3 "corrections" and a "rising market". The latter was better for houses than condos and I bought a house.

We're in for a recession and prices will drop. Older houses can be a problem in rapidly growing sunbelt sprawlburgs because rapid growth tends to mean that the population goes further out.

Even with a relatively quick rebound in the economy, you're only likely to make money if you stay in the house a long time and it will need to be longer if prices drop. You'd be better off paying down your debt and saving for a large down payment.

You're smart to recognize that a house creates expenses---realtors try to convince you that its cheaper than renting. Even if you do a lot of routine stuff yourself, you'll be buying tools, paint, etc. You need to know how old the HVAC, appliances and roof are---those will be major expenses. You really should set aside the equivalent of a condo fee every month to cover them.

One question I have is how long you plan to be in the area and how secure your job is? If the answer is not long and/or I don't know, then I wouldn't buy. Also, if you live in a place you really don't like, make sure that a property investment has an escape plan. I lived in Atlanta for 7 1/2 years and was never so happy as when I left and I was relieved once I had some options for departing and I was lucky enough to sell shortly before the market cratered. It took many years before the person who bought my house could make any money (12 years, in fact), so you should realize property can be a gamble esp. in problematic economic times like these.

Looks like a motel.

Sounds like OP has let his emotions take over. Don't see the house again.

This is sooo stupid. The market will crash. You have debt - pay that shit off. And you never know the financials behind your company - you've only been there 2 years. You don't know how vulnerable it is in the next few years.

Pay off your debt and instead invest some money in the stock market when the time comes. But by all means, do not buy this house "because I've always wanted one". That's the WORST reason as of April 2020.

That's one ugly ass house. Hard pass.

Tasteless enemies, will there be lots of nice houses available at bargain prices because CORONAVIRUS?

R44 - This will actually be my first time seeing the house in person. I'm actually a pretty pragmatic person. I just figured I had to check the house out since it's unusual to find a house this small, with a pool and in this good condition for this little in this market.

Turns out one of my work friend's wife is a realtor, so she's going to show me the place and understands I'm probably not really in the market until next year. She's also been practicing in this market for about a decade so can give me some historical context on how this particular market was affected by the Great recession. I'm 90% sure I'm going to wait until next year before buying, so, for now, I'm going to have some low pressure fun browsing.

What kind of attention seeking fantasy roleplaying is this? Get real and pay your credit card debt. Sheesh!

I think the nervous nellies on here are way too pessimistic. This is a beautiful house and it's the perfect size and it should be relatively easy to take care of. It's a bargain for $210K. Your mortgage payment will be less than your rent. I don't see the housing market collapsing in Florida at all, but even if it did...your mortgage payment will be less than your rent. It's gorgeous.

[quote]Annual home price growth will decelerate from an original estimate of 4.6 percent to 0.4 percent, but price declines will not be sustained on a national basis because of additional factors including the tight inventories which the nature of the current crisis will tend to sustain.

I agree with R49.

R49 - you have no idea what area this is in. OP didn't provide the MLS listing - just a generalized area.

And the vast majority of businesses will be affected by this crisis. The house won't sell right now - nobody is buying. And I'm not even sure what the lending situation is - that could be iffy as well.

It's a jackass move to tell anyone to buy right now.

If this house were located in WV, I would buy it. A house this stylish and clean would cost a million bucks in CA.

R49/53 - well, you have a warped perspective. CA perspective should not be what a person in Jacksonville, FL should bring to the table.

Went to see it today. It's actually really charming in person and they clearly invested a lot in the remodel. The only obvious improvements would likely be some landscaping (there's a whole large side garden which wasn't captured in the listing -- in addition to the main pool and deck area) and replacing the single pane windows with double pane for better insulation. The realtor friend also thinks we could get them below $200k. She also confirmed what I thought I'd gleaned from viewing comparable listings in the market -- it's a bit unusual to find a mid-century home in this area, with nice a remodel that maintains some character and doesn't go total cookie cutter, with a pool, but not too big for a single person in this price range. In other words, it's not a typical listing.

Unfortunately, the immediate neighborhood is a mixed bag. It's one of those random Northeast Florida neighborhoods -- a little older, a little shabby. One home will be incredibly well maintained and its property well manicured with a Mercedes in the newly paved driveway while the very next house will have potholes in the driveway, be two decades overdue for a paint job and have five cars parked on the front lawn. There does appear to be a trend of several flips in the immediate neighborhood, so it could be argued this would be the time to get in. I'm almost certain I'm not going to really begin an active search until next year, though. This year, I'll probably just pay off the credit cards and actually downsize and put even more into savings for a larger down payment in 2021.

But it is fun to look. The realtor friend knows that I'm seriously considering waiting until next year, but she and her husband love just going to see houses, too, so they've offered to keep sending me listings that match my profile and budget, so I might keep looking with them for now.

[quote] There does appear to be a trend of several flips in the immediate neighborhood, so it could be argued this would be the time to get in.

[quote] This year, I'll probably just pay off the credit cards and actually downsize and put even more into savings for a larger down payment in 2021.

OP, thank you for checking in after the open house. The flips happened before Corona virus. Your plan to pay off your CC and downsize sounds good.

I would just based on the home, but then, I have no financial concerns and tons of money to throw around all willy-nilly.

What's the property value looking like? I ask, because a lot of buyers look for newer homes under the assumption that there won't be any mold, plumbing issues or musty, dated appliance problems if the house was built more recently than the nineties.

I like it.

There’s no such thing as a bargain in real estate, especially with a public listing.

You should buy this one, OP.

Nice, r60, but I wonder what’s under all that carpet and why the yard is astroturf.

It’s a nice home, OP, buy it.

It can double as your mausoleum when the pandemic kicks into high gear.

None of this is happening. This house will not be bought by this OP. He's wasting everyone's time.

I’d have no interest in house hunting unless I was serious about buying.

It’s a waste of time for me and for the realtor.

It sounds like the real estate agent is in the bored housewife category. Normally you shouldn't use co-workers spouses or friends of friends as your agent. I'm in the biz and some of the people practicing are doing their clients no service. Get an experienced agent! If you're making in the mid 100's it's irresponsible to have any credit card debt living in cheap ass Jacksonville. Are you driving an expensive car? If you can get to 20% down you can avoid PMI, which is a total ripoff. Do you or your agent know who did the work? Was this an amateur flipper? These are things you should consider.

Sorry OP, it's dreary. Bad juju. But keep looking and post here again.

Central California is the New Jersey of California.

[quote] I'm still a California guy at heart and home ownership was never in the cards there for me

You make over 100,000k and you couldn't buy a house in CA? Sorry but I live in CA all my life and I know lost of people making less than that who bought houses and condos. Just not in the most prime areas like Beverly Hills, Santa Monica or West Hollywood.

It's horrible. The cheap laminate flooring that they actually put on the front porch needs to be completely torn out. The worst thing these people do when they try to make older homes "open concept" is to tear walls out so when you come in the front door the first thing you see is their fucking kitchen sink. OP I hope you rot in real estate hell. I really do.

The house shows well for the price, but upon closer inspection, the construction looks sub standard. Yes, the design is nice but I am talking about the actual structure looks poorly built. You might end up with a lot construction fixes over time like a new roof.

Florida houses have always been cheap OP. Lots of people lost their shirts buying there just before the real estate crash in 2008. You could buy a house there for about 150,000. So coming from CA where houses increase in value no matter what happens, don't except that to happen in Florida. People don't want to move there, they do it only because it's cheaper to live there. That means they don't want to pay top dollar or even going rate.

Compare that to people who are willing to sacrifice almost everything, size of the house, location, quality just to live in CA. For better or worse, the real estate market is very different from California where if you stay put, you will make your money back 10 fold. If you never plan to leave Florida and die in that house then go for it, otherwise I would pass.

I don't know OP. This house looks cute enough, except for the ugly wood tile floors and the kitchen island, but the neighborhood looks kinda sketchy.

If you are going to buy a house at this time, I would get one in a good neighborhood so it stands a better chance of withstanding the recession/depression that's coming.

OP, there’s a ton of misinformation and fear I n this thread, led by a bunch of know-nothings.

1. Even if we have a recession, home prices WILL NOT drop by more than 10-20%, if that. The previous recession was caused by sub-prime mortgage defaults. Real estate will not be the cause of the next recession, since those factors (ie. loans made to poorly qualified applicants) don’t really exist any longer. Since the last recession, banks have greatly tightened mortgage requirements, meaning far less potential foreclosures.

2. Actually, now is an EXCELLENT TIME to buy or to sell. Buy — because prices are generally low right now. Some sellers are frightened and are prepared to offer good deals. Post recession, or if there is no recession (an increasing possibility) prices will only go higher. Sell — because there is a severe shortage of properties for sale (there was a shortage even months before Corona) and yet there are people who are actively searching for homes to purchase, and others who think they might snag a bargain.

3. If you wait for prices to drop, that’s very risky. If you’re an all cash buyer you might be successful because that gives you negotiating power. But if you have to sell property before you can buy (that’s most people) it will all be relative since your property’s value will have fallen roughly the same as what you want to buy. Also, should home prices drop substantially as they did in the last recession, major real estate corporations will jump in to bid against you, and snap up the bargains just as they did before.

OP, every area is slightly different. You need to find an top notch real estate agent... one that you trust... to guide you.

If you were seriously considering it you wouldn't have posted it on Datalounge.

If that house is in Arlington Op,run screaming . I live in Jacksonville ,and any neighborhood that is sketchy needs to be avoided at all costs . Even "good" neighborhoods like San Marco have bad streets . Also , the air conditioning bill will be exorbitant . Single panes ? In Florida ?

Just found your house Op,Fernworth,right ? Run screaming ! That neighborhood is shit !

It’s cute on the inside but I’m not so sure about the neighborhood.

Love the comment “buying is a GREAT idea” - no doubt said by a boomer who bought in SF 30 years ago. Real estate in Florida is pure speculation - and as clarified, crappy neighborhood, crappy windows with no upside potential - and the height of the market. Parts of Florida were already down more than 20% before this - prices are plummeting. Don’t be emotional and buy. Be logical and wait - better time and better neighborhood.

R79 No one will want to live in FL in 30 years. Climate change, deranged hillbillies-- neither of them can be stopped. Buying in SF 30 years ago wasn't a good idea? I'm confused.

Is it near the ocean?

R74: A realtor. They'll always tell you it's time to buy. It isn't. A good realtor isn't going to give you a hard sell.

Hi R82, I’m an investor, not a realtor. And who’s giving OP a hard sell? I’m giving him my suggestions based on decades of real estate experience, good and bad. I advised him to get good, local advice.

Sure, there are people who’ve lost money on real estate. But GENERALLY SPEAKING, if you buy a good house in a good neighborhood at a fair price, you will not lose any money over time. If you are waiting around, hopIng that a recession causes home prices to fall drastically, you are in for great disappointment.

So much fear in this thread. Doubt kills more dreams than failure ever will.

R74 "Now is the best time to buy" = REALTORS everywhere.

Im questioning Op's story anyway because no realtor worth their salt would take Op to that crime ridden shit hole area . Especially if they were a friend !

[quote]Even if we have a recession, home prices WILL NOT drop by more than 10-20%, if that

Complete bull shit. I'v seen housing drop more than 50%. Renumber the 2008 crash? Now R74 says "oh that will never happen again" really? Dose he have a crystal ball? It may not come from a bank loan scam like it did in 2008 but there are dozens of other ways the economy can crash, and when it dose, people lose their houses, they flood the market, they get cheaper to buy and it can become a vicious downward cycle. 2008 was not the only time in history this happened.

By the way crap neighborhoods are the first to go and the last to recover usually. Always buy in the crappiest house in the best neighborhood. Make it what you want later. You will thank me years from now. You are welcome.

[quote]no realtor worth their salt would take Op to that crime ridden shit hole area

Since when? LOL We are talking about Realtors. Morally bankrupt doesn't even begin to describe 99% of them. Their values were on short sale long before they became Realtors.

Prices in parts of Miami declined 72% in the last recession. Still worth less than pre-2008 in some places. The top of the market exploded. Everyone else was barely paying the rent - or mortgage - and now they can’t even do that. I will guarantee you FL real estate will be cheaper in a year or two.

Imagine you spend 200K on your first house, 20K down, 30 year mortgage, 6 months late it drops to 120K. Not only are you trapped upside down in your loan, you suddenly realize you are surrounded by hillbillies.

R84, since you seem to be such a savvy real expert, when IS the best time to buy? Please educate me. I’ve bought and sold more real estate than everyone on this thread combined.

R86, Have you been drinking? Your post is almost unintelligible. I said I predict that house PRICES — not VALUES — will only drop 10-20% during the next recession. Of course there will be places where it’s better or worse. All homes fluctuate in value but those are paper losses and gains. It’s when you sell that’s important. Generally, the longer you hold a property the more likely it is to increase in value. Lastly, I never said “oh that will never happen again” regarding another 2008-type recession. I said the next recession will not be triggered by tons of bad loans made by banks.

What a bunch of stupid fucks. All we know is right now people seem to be holding off buying or selling. Since we are in a new situation from every perspective, we don’t know what is going to happen. Despair trolls, fuck off and go rim Putin. The guy who said buy the shittiest house in the nice neighborhood is dead fucking right. The investor is dead right. The rest of you who make the most noise are full of shit. OP, if you don’t get the house there’s usually a reason. One you control, I.e. you really didn’t love it or those you can’t control, outbid, realtor fucks up a deadline. But either way something right will come along. For what it’s worth, I think Jacksonville has a low appreciation curve and a low depreciation curve, that’s the way a healthy real estate market is. Drive around and look for houses in great neighborhoods that are neglected and investigate. I’ve found some if my favorite properties this way. Caulk and paint are cheap.

“Be fearful when others are greedy. Be greedy when others are fearful.” — Warren Buffet

“The time of maximum pessimism is the best time to buy and the time of maximum optimism is the best time to sell”. — John Templeton