Our big move is about 6 weeks away now. I have started giving away the furniture that we aren’t planning on taking, our fish are gone and the tank is broken down, I started shampooing the carpet in the toy room and I’m weeding through clothes that won’t go with us. It feels good to be moving on. I still don’t know which route we will go in adding to our family. I am kind of enjoying not having to think about it until we get settled in.
Speaking of settling in; I know several of you are homeowners or previous homeowners. E and I are strongly considering buying a house when we get down there (we have been checking available houses for several months). The problem is we have no idea what we are doing. I don’t know what questions to ask a realtor or what a lender will require of us. The good thing is that E is eligible for a VA loan which will allow us to buy with no down payment. We are not looking for our dream home because neither of us wants to settle there permanently but we want something nice. I’m just tired of living in someone else’s house. We have lived in base housing at every assignment. So far we have been really lucky with neighbors and things like that, but they aren’t really my own place. I can paint the walls, but everything needs to be in original condition when we leave which means painting them back.
The other selling point is that if we live off base, E will be given a housing allowance which will cover our mortgage payments. So really, we would have a house for free. When E gets new orders we just resell the house and pretty much get all of that money back in profit.
Here are my concerns:
Is it just me or is the real estate market very high?
What should I be looking for in a house?
What would be warning signs in a home/realtor/lender?
We will be living in hurricane alley… is buying a home there a good idea?
Are there things that you wish you had known when you bought your houses?
Should I be concerned about resell value?
How do we build equity?
What is the average interest rate?
How on earth is a mobile home valued over $100K? I mean, that’s a trailer, right?
Am I asking the right questions?
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6 comments:
I live in a duplex that my father owns (I'm buying it from him once my finances recover post-adoption). But last year I was shopping for houses. The only real tip I have is that the photos you see in the sell sheets and online don't tell the real story. Both ways I saw one house that I loved online -- but online you can't smell the cat pee or see the cracks in the foundation. Another I wasn't sure about and it ended up being perfect for me. It's hard to tell until you walk through. Good luck!
We've both 3 houses & sold 2 and watched parents/siblings buy/sell within the last few years. You are asking the right questions. One thing to consider re: resale value is to buy in as good a neighborhood/school district as you can afford. This will help mimimize the market's ups/downs.
The real estate market is a bit overpriced, and seems to be slowing down. Sounds like you are moving to Florida? The Southeast is generally cheaper than any other part of either coast, but in parts of it (Sarasota, Miami) you have to pay a lot to get a little. The panhandle is generally cheaper. $100k for a trailer seems a lot, particularly since I assume that doesn't include the land? And I'm with Margaret- don't buy until you look.
Building equity comes one of two ways: a) live there so long that you pay off a good chunk of the mortgage or more likely b) hope that the market value increases so that by the time you sell, its worth more than what you paid for it.
My biggest bit of advice when purchasing a home is to get an inspection. Don't let a realtor talk you into buying a house sight unseen or without an inspection. It is best to know what you are getting into. Especially in the hurricane zones. There could be unseen water damage or something worse.
I have rented more than my fair share of apartments and homes and let me tell you owning is a dream. Of course you are the one who is responsible when your septic backs up into your back yard, but every cracked wall or brown blade of grass is all yours! Best investment we have ever made.
We have purchased 4 homes and sold them all ourselves without a realtor. To buy you want to use a realtor- don't buy a For Sale by Owner- but if you can sell this way, do. The best realtor is one whose office is very near or right in where you want to buy so that the person is very familiar with the area. However, don't expect the realtor to tell you what is or is not a good buy or a good area. They will tell you the most expensive thing is the best. You need to do your homework. Research the best schools first- do this online- never ask around about this. Everyone thinks their school is the best. You need to see the test scores for the schools. Then find out the exact boundaries you want to be in and let the realtor know. What you want in a realtor is someone who can get the house you want- good negotiating skills and then get the sellers to do all sorts of things to fix up the house better for you- or give you extra money to fix whatever you want. This is what makes a good realtor.
After you figure out your price range and the zip codes/neighborhood boundaries you want- search online for that area. When you see something come along for a good price- that meets your location and general parameters (the right schools, size, appearance) then copy down the information about it. You can start to track houses from Alaska and just keep a record for when you go down to meet your realtor. You can then see all of the houses on your list over a weekend with your realtor. As far as resale it is better to get something smaller that is more expensive in a nice area then a cheaper bigger place in a less desirable area. Location is everything. The market is slowing a little, which means that you will be able to get a better deal than the people who bought last year. Buying in a good school district will be more secure.
As far as what you want in a home- that is very personal. You should try to compile a list of what you want and how important that is to you so that you can be clear to the realtor and yourself what you want. Good things to look for are- not a busy street, close to the bus stop, fenced yard, nice size kitchen and bathrooms, updated appliances, new things that are expensive that have to be replaced (like water heater, air conditioner, roof, etc.). Make sure you get a home inspection with you there.
If you are in a hurricane zone make sure the foundation is built for it and you have good insurance. You build equity by just living in the home for a long time. Your husband’s housing allowance may not completely cover the cost of your house, but it should be close. Sorry this is so long. I am really interested in this subject. If you have any questions, please ask me about anything. I think this is the longest comment I have ever left.
All I can say is ask the following question:
"Do I have to buy flood insurance?" LOL. I don't know if they have flood zones in Florida, but that will BITE you. Flood insurance is expensive.
OK, I guess that wasn't ALL I had to say because I just really want to advise you to buy. Its a great investment and even if the market is high, chances are that the property values will only rise further.
Avg interest rate depends on your credit score, but I'm hearing right now its between 6-7%. It might be lower with a VA loan, I don't know. The process is kind of daunting, but with the VA loan, it should go smoothly. Its best to get pre-approved for your loan first so you know what price range you're looking at.
Your realtor should ask YOU the questions about what you want. Its best to pick out some homes you like on the internet and show them to your realtor. Then he/she can start looking for you based on what you like. Our realtor once asked us to make a list of everything we REQUIRED and then make a DREAM list of everything extra we would dream of having (i.e. jacuzzi tub or something). That was good. Also, don't be afraid to fire a realtor if they're not meeting your needs.
You can build equity several ways...just buying is building equity. You can make bimonthly (split your monthly payment in half) payments instead of monthly and that cuts your interest down a little bit by stopping the "interest clock". Or you can make just one extra house payment per year and that will take years off your loan.
One more piece of assvice...don't borrow the max that you're approved for if you can help it. Often times, realtors will push you to buy the most expensive home that you've been pre-approved to buy. Don't cave into that. If you can afford it, great. But if its out of your comfort zone, tell your realtor up front that you feel the homes you're looking at are too expensive. Banks will loan you much more than clints can afford, with interest rates being fairly good. Just because they pre-approve you for that amount doesn't mean you have to borrow that much :)
Good luck! Shopping is the fun part.
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