Home buying thread
- Thread starter Pasteton
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Guest, it's time once again for the massively important and exciting FoH Asshat Tournament!
Go here and give us your nominations!Who's been the biggest Asshat in the last year? Give us your worst ones!
Asshat Brando
Potato del Grande
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Comps have to be closed sales. You can try to argue a certain sale is more relevant to your home than another sale but you can't "manufacture" comps in that appraisers have set guidelines for what they can use and again it has to be a closed sale.
I've been in the real estate industry for 20 years now and I can count on one hand the amount of times in the 1000+ deals I've done where someone said "fuck it" and paid beyond the appraised value. More than likely all of them would have ended up making money but to say a person will not give a shit that they paid more for a "thing" than what other people tell them it's worth isn't common.
I've been in the real estate industry for 20 years now and I can count on one hand the amount of times in the 1000+ deals I've done where someone said "fuck it" and paid beyond the appraised value. More than likely all of them would have ended up making money but to say a person will not give a shit that they paid more for a "thing" than what other people tell them it's worth isn't common.
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LachiusTZ
Rogue Deathwalker Box
- 14,472
- 27,162
A lot of the online public tools are pretty ... Unreliable?
You can get some good data, but you need to be aware it can be tainted.
If they are people you know, cut the real estate agent out of the deal, then decide how long you are going to live in it.
Some agents you can pay by the hour to review comps, give you MLS data etc.
You are in an almost one off by being interested in a friend's home.
If it's a home you intend to live in Long enough to pay it off, as long as it is structurally sound and a reasonable price, it's a good investment (given the indications you have made in other posts on your personal preference. Land, rural, etc)
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Bandwagon
Kolohe
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- 66,134
The appraised value seems reasonable to me and he said he got a few "lowball offers around 125" the last time he had it listed. This is my cranky old neighbor and his wife who love me because I flick him shit and call him a sour jackass all the time. He's been telling me twice a month for the last 2 years that they think of us as their kids.
I've always loved the house and I'd only seen half of it before today. I don't want to insult the guy and I'm pretty sure he's going to counter with the best deal he's willing to give me either way.
I guess it's a lot harder to really lose your ass with a $200k house in a rural area compared to a $800k+ house in the burbs, eh?
I've always loved the house and I'd only seen half of it before today. I don't want to insult the guy and I'm pretty sure he's going to counter with the best deal he's willing to give me either way.
I guess it's a lot harder to really lose your ass with a $200k house in a rural area compared to a $800k+ house in the burbs, eh?
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Bandwagon
Kolohe
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*everyone* I've ever talked to about home buying in person (in the pac NW) has said that the sale price is always higher than the appraisal. Most of that is in two fast growing towns, though. Is sale price matching the appraised price unique for your general area or certain areas in particular? Cities?
Yup. Been here 5 years now, I suppose it's time.
Lanx
<Prior Amod>
- 66,122
- 150,684
Bandwagon
Kolohe
- 24,604
- 66,134
That was in the goat shed I lived in when I first moved here. This current place isn't drafty, it just has shit insulation.
Sale price over appraisal is one thing, 25% over is another. Buying off someone you know/like is tough because the last thing you need is the worry of offending them when you have to consider 900 other variables.
I usually sleuth Zillow etc and try to come up with a totally independent number.
I've seen realtors scoff at submitting a low ball but they do, then the sellers counter at token amount more and the deal is done. Just another reason to hate realtors.. the more you offer the closer they are to commission.
I usually sleuth Zillow etc and try to come up with a totally independent number.
I've seen realtors scoff at submitting a low ball but they do, then the sellers counter at token amount more and the deal is done. Just another reason to hate realtors.. the more you offer the closer they are to commission.
Khane
Got something right about marriage
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Appraised value *always* being lower than sale price is a good indication the market is inflated. People tend to have very short memories when it comes to real estate so I'd take what people tell you about appraisal vs sale price with a grain of salt.
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Asshat Brando
Potato del Grande
- 5,346
- -478
That has to be pretty unique to that market then. I mainly do deals in LA but have recent deals in SF, Dallas and Austin and I can't remember the last time an appraisal came in low on a purchase. The appraiser has to certify on the appraisal he/she reviewed the purchase contract, they know what you are paying and in essence they are just trying to justify the price you are paying. 9 times out of 10 the appraised value and the purchase price is one and the same. Furthermore, at least for the market I'm in, appraisers have been squeezed by AMC's and are paid shit per appraisal. They need to do double or triple the work to make the same money so they're not going to spend more time than needed if they meet the basic requirements.
I also think it's somewhat impossible to have every deal be above appraised value unless the houses in question are being sold in sequential order in 60-90 day increments at least 25% higher than the last sale. Once someone pays above market that is then a comp for all the other houses in that neighborhood. That doesn't mean they'll all be able to sell for that higher price but if one does you then have a data point + appreciation factor to go towards the higher price.
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Bandwagon
Kolohe
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I was going to talk to one of the volunteers at the fire dept, who is a realtor, about this place but the more I read from you guys the more I think I should go see someone new. All 3 of us are friends and it's sounding like that's more of a negative for me than a positive.
This area is booming with real estate development because of vineyards and wineries, and my neighborhood in particular is inside of the "The Rocks" AVA boundary. Theres a 10 acre lot that's about a 1/4 mile down the street that used to be an orchard and was just bought by a small winery.
If the price is inflated because of all that grape monies coming in, isn't that a reasonable indicator that the inflated prices will continue trending upward and its not an artificial inflation or a bubble?
Sorry for all of the naivety on this - I've been a vagabond most of my life and never thought I'd end up settling in one place, so I never paid attention. I'm too embarrassed to ask people I know in person.
This area is booming with real estate development because of vineyards and wineries, and my neighborhood in particular is inside of the "The Rocks" AVA boundary. Theres a 10 acre lot that's about a 1/4 mile down the street that used to be an orchard and was just bought by a small winery.
If the price is inflated because of all that grape monies coming in, isn't that a reasonable indicator that the inflated prices will continue trending upward and its not an artificial inflation or a bubble?
Sorry for all of the naivety on this - I've been a vagabond most of my life and never thought I'd end up settling in one place, so I never paid attention. I'm too embarrassed to ask people I know in person.
Whoever you ask don't expect a conclusive answer in general and I guess it would be worse speculating on wine money. If someone says you're definitely going to make 30% in a year which is what the over appraisal would indicate I would be skeptical.
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Asshat Brando
Potato del Grande
- 5,346
- -478
A working vineyard or winery isn't a comparable for a residential house. Without going back through this thread to see exactly what type of property you are looking for I'll assume you're looking for a property with acreage. Even in my limited USDA knowledge/experience they are still appraised as residential houses that have the ability for a working hobby farm with the main comparable being the dimensions of the house and the lot size. It's two completely different things that while tangentially related (cost of land, jobs, etc) they aren't used as a basis of determining value. The vineyard/winery pricing is going to be based on income potential and the possibility of paying more than before always exists based on what the owner thinks they can make on the property. That's not the case with residential as you are actually living in the property or renting it out at market rates which isn't enough income typically to alter the valuation method such as with a 30 unit apartment building rented to section 8 vs. high end tenants.
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Asshat Brando
Potato del Grande
- 5,346
- -478
There's also laws in most states that prevent a re-assessment of value as tax rates can only increase a certain percent per yer. That typically gets reset upon deed transfer but up until then in a lot of cases assessed value has little relation to what the property is actually worth as it's not being taxed on that anyway.
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Lanx
<Prior Amod>
- 66,122
- 150,684
i don't want to be a debbie downer, but when has it EVER been good in the history of deals when a friend offers to sell something of theirs?
i mean, you view them as like surrogate parents? what happens a year down the line you actually own the house and they want to visit, sure you can stay in their old house. and then 2 dinners later, after drinking a bit of wine and having desert, they say "you know... i really don't like what you've done with MY OLD HOUSE"... but i guess thats YOUS GUYS own flavor, not what i would do if i still owned the place tho!!!
Khane
Got something right about marriage
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"Now's the time to buy! The market is exploding! The soil here is perfect for wine grapes and you need to get in now before it's too late! These properties are going to be worth 300% more in 5 years! Sign with me and we can start the paperwork right away!"
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