My fiancé and I are looking to buy our first house in the tampa, fl area (specifically Clearwater or safety harbor). Our top budget that we want to spend is $220k but Ideally around the $190k mark. We currently rent and our apartment lease is up in July. We have already put two offers in on houses to be outbid by cash offers or better offers. Both of our offers were at asking price or just over. We have been looking for a few months now and the market where we are at just seems to be booming right now. If my real estate agent says "The market is just so crazy right now" one more time I think I might go crazy.
I'm starting to feel uneasy because we are going in houses and both completely overlooking things that we want in a house just because we feel like we have to broaden what we want so much in order to have a chance of getting a house. Just the other day we considered offering on a house that had previous termite damage and was still going for a fairly decent asking price in my opinion. We ended up not, but I just had to take a step back the past few days and ask what the heck we are doing.
I still feel like in general its pointless to be paying what we are paying in rent every month and would rather invest in something then nothing. I am 24 and my fiancé is 23 and we combined make over 100k per year, stable jobs and both good credit. I feel like we are doing pretty well for ourselves at this stage in our life but am just having totally mixed emotions back and forth on what we should do. Get into a house (any house) now or wait it out and see what happens with this ridiculous market? I know this is the gamble you have to take as a homebuyer anywhere as you can't predict the future.
I guess I'm looking for someone to either come along and say YES if you can afford it get into a house now while you can or NO wait it out you would be crazy to get into something you both don't absolutely love just because I feel like over the short term the market is going to get even crazier.
One year ago I was in the exact same situation as you (but I'm single). You need to be very aggressive. IMO Redfin is the best website to find homes as they come on market. They update their site regularly throughout the day to make sure it's very current. If you use their agent they also do not charge the full 3% commission. Their site layout gives me the pertinent info that I want to know, especially when the home was built which a lot of sites either bury or leave out.
In today's market you need an aggressive agent. If your friend's mom or whoever is your agent, isn't being aggressive and isn't familiar with the latest tactics on how to win a bid in 2013, I strongly urge you to find another agent. Your agent should be very comfortable with escalation clauses (automatically raising your bid if another matches it), possibly waiving contingencies, and other tactics such as waiting until the last minute to place your bid so that others have a harder time gauging your interest.
I also suggest you use a solid loan agent or bank like Wells Fargo. Stay clear of Bank of America. They have the lowest rates but they will have a very hard time executing. My loan agent worked with an agency that did their own underwriting. This was a blessing because it made for a quicker closing time which counts for a lot.
I was shot down on my very first bid. Asking price was $149k, I offered $153k, the counter offer was $147k. The sellers decided to go with the lower price because she had 20% down payment in cash and I only had 7%. My second bid was also turned down because of a 20% down payment. Now I am getting very frustrated and I'm going crazy.
It's April 2012 and the lease on my apartment runs out on June 30. I have roughly 1 1/2 months before I have to tell the apartment manager whether I will re-up or not. I am going ballistic on Redfin, looking twice a day, every day, running out to see homes the minute they pop up.
The apartment manager is asking for $805/mo in rent. If I get my way with a home, it will cost me roughly $860/mo in mortgage payments so I would only be paying a little bit more per month to own my own place. If I choose to go month to month, they would have charged me $100/mo in extra fees ($905/mo) which would have been outrageous.
Before it's said and done, I will place 3 more bids, one of them I actually won, but because the inspection went so poorly I had to turn it down (nothing was up to code, I was getting super desperate). The other bid the bank actually withdrew and the last one I withdrew.
One tactic many people are using today is waiving contingency. They aren't doing it illogically however. Get a list of the best home inspectors in your neighborhood. Redfin might have a list, I don't know if they do FL or not. When you find a home you are serious about get it inspected ASAP.
He should be able to give you an idea of the condition of the home and how much work it will need. If it sounds satisfactory to you, you can decide whether or not to waive the inspection contingency. This will give you a leg up on the competition because it speeds up the home buying process. It's risky, but it's something I was willing to do to get the house. I don't give this advice lightly because 1) that's $400 you won't get back and 2) it may come back to bite you if you learn something about the home that you didn't know, but you have to decide what's best for you in this market.
If you are really nuts you can waive all contingencies (finance and inspection) but that's only if you really want to take a chance on things and you really feel things will work out. I wouldn't do it in your case because your marriage will probably cost you some money and leave you in some debt.
Eventually I said screw it and I wound up buying a condo. It was the best decision I made. Condo's are a bit cheaper than homes because you don't have to worry about grounds maintenance. They also have cheaper prices generally speaking because they are less desirable than homes.
Not all condo's are in shared living environments. There are a few condos in my area that stand alone like homes but unfortunately I am not in one of those. Because everyone was looking at homes they completely overlooked a gorgeous condo that had new paint, new carpet, and kitchen and master bath that were completely redone with custom cabinetry and granite countertops. I got it for $105k.
I don't know how you feel about condo's, but you might be like me and my brother. I was not looking forward to buying a lawnmower and maintaining a backyard. That's too much work. I also did not want to buy a fixer cause I don't know anything about it and don't want to deal with it.
I had already drawn up a contract and was ready to sign it. I placed my bid for my condo around May 23. 2 days before I had to declare whether or not I was going to re-up I told them I was not. We closed on June 26 and I received the keys that day. I had 3 days to move everything out of my apartment into my new condo. That's how close I cut it.
Don't give up. You still have time to find that dream home. Be very aggressive and find an agent who is also very aggressive. Either that, or simply go a different route and either buy a condo, or try the lease to own program that is sometimes offered. Also, if you can avoid going FHA, do it. You will save yourself money in the long haul by going conventional.
One of the reasons why I was able to get my condo was because the HOA was not FHA approved. 2 buyers wanted my condo during the 1+ month it sat on the market but they were both FHA so they couldn't make a bid. By going FHA they put themselves out of the running because not every association is FHA approved.
Learn how to read the history of the home to gauge it's condition. Redfin has a listing of the price history of the home. It will tell you if it's a short sale or foreclosure. I got so good at weeding out the crappy homes just by reading it's history and looking at pictures from Redfin and Google Street view. It was a real time saver and I learned how to zoom in and focus on the quality homes. I kept a diary of each home I went to on my smart phone so that when I saw the listing again on Redfin, I could refer back to it. Your home search will be confusing at times. There are so many listings you won't remember them all. Try to keep notes on the homes you already seen.
It's a seller's market right now. It's Spring time and people are moving. The homes are there for the taking. You just have to go out there and get it. Stay focused and be aggressive. Work with your agent, talk to people, and try to get a leg up on what's coming on market. Sometimes you can get the jump on others if you know a home is coming on market.
Last edited by Padmakumara; 04-14-2013 at 02:14 AM..
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