Author Topic: Need advice: condo vs. short-sale or major fixer house  (Read 2101 times)

CharleyGirl

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Need advice: condo vs. short-sale or major fixer house
« on: January 09, 2014, 12:12:24 PM »
Hello all,
I would really love some advice on this topic.  My fiance and I are about to purchase our first home (currently renting), and we are a bit torn between some options.  We are looking at the low end of the housing budget in our area, so are limited to houses that are major fixer-uppers, short-sale/bank-owned, and then also some condos and town homes.  Here's the thing: we've looked at the financials for both options, and we know how much we can spend in both situations, taking into consideration (among other things) expected maintenance costs and HOA dues.  In a condo, we would be getting something much newer, with not much work that needs to be done, and no work that's required for it to be nice to live in.  But we wouldn't have outdoor space for gardening, refinishing furniture, building things...which we can't do now, but would like to.  We'd also have the shared-wall thing with our neighbors.  I've also grown up in houses, so that's my ideal 'home.'  Not that that by itself is a reason to discount condos.  In a house we would be getting an old, outdated home that needs work, maybe even to make it livable.  Over half of the houses we can afford are short-sales or bank-owned.  I worry that if we put an offer on a short sale house and the bank denied it, by then we'd be into the warmer season where around here the housing market tends to get a lot more competitive, possibly crowding us out of the market almost entirely.  So what do you all think?  Is it worth pursuing a run-down short-sale house, mostly because it allows us to do more of the 'fun' stuff that could save us money in the long run (veggie gardening, diy stuff), and doesn't have HOA dues?  Or should we get a condo instead? 
Oh, and by the way, if we were looking in a larger radius we'd be fine, but we're limited by my fiance's bike-to-work radius, which is an absolute requirement for us.  So that's part of the limitation that is non-negotiable for us.  I'm a student at the moment (again), so can be more flexible with finding work after we have a place.  We're hoping to be entirely carless after we settle down in our new home, and just cycle everywhere!
« Last Edit: January 09, 2014, 12:14:43 PM by CharleyGirl »

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Re: Need advice: condo vs. short-sale or major fixer house
« Reply #1 on: January 09, 2014, 12:38:29 PM »
In California and Arizona, the banks are generally not approving short sales at much less than market value for the same house in good condition.  Agents will often solicit below market offers just to get a number back from the bank and then put the property back on the market at the approved price.  Occasionally you will see a pre-approved short sale, with a price the bank has approved.

Before you do much shopping, you should get approved for a mortgage.  That will define your true market range.  If you have an agent, that person can ask the listing agent for the details of any short sale that looks interesting and run a comparable sales analysis for you.

Condo vs. townhouse vs. house is a matter of personal preference.  I personally would only buy a house.  Condo fees and rules are not under your control.  If you have a noisy neighbor, there is no landlord to complain to and it's not easy to move. 

In your shoes, I would rent until my job situation was stable.  Being flexible finding work after you graduate may or may not be possible.  You also don't mention a marriage date, and disentangling from a piece of real estate if the relationship ends can be very messy.  I would wait until after the wedding to commit to owning a shared asset like a house.