101 on buying a house?

[Aardvark]

Hi all,
My wife and I are looking at buying our fist house. Possibly in the next two weeks as we saw something amazing today, and very-probably within in the next year if this option falls through.
The truth is that we have no idea what we're doing. I'm an immigrant, so the buildings foreighn to me (I'm not familiar with dry wall, attics, basements, real winters, etc.) and I'm not even sure of the details around the house buying process.

What I am hoping to get help with in the comments:
1)More than anything I don't want to be tricked into buying something shitty - are there any good checklists that I can work with to guide me through the buying process?
2)I want to understand what I can do to maximize mustachianism by avoiding unnecessary fees (lawyers fees ,transfer fees, applicaiton fees, comissions, etc.)
3)I'd like help in assessing whether a property is worth buying or not. Any key metrics, ratios, heuristics, etc would be great. I feel as though this is very subjective because I have my own set of priorities and quirks (e.g. this house I'm looking at has a water canal running along the one side and we would be allowed to draw from it)
4)I've been trying to understand how easements work in the US (and specifically in Boise, ID) and whether this cool water canal could limit development in the future.
5)unknown unknonws - what else should I be asking about?

Thanks in advance!!!

[Freedomin5]

Buying a house is one of those things I wouldn’t cheap out on. You’re literally spending hundreds of thousands of dollars on one item, so you want to make sure you do your due diligence. We purchased a house in Canada, so not all of the advice below may be relevant.

Get a good real estate agent. Ask trusted friends for recommendations. A good agent will be able to tell you what to look out for, will be able to spot some problems, and are worth their weight in gold if they know your market well. They’ll be able to tell you what a fair price is, and will negotiate on your behalf.

Do not skip the housing inspection. Make your offer contingent on a housing inspection. Read over the inspection report. Have your real estate agent read over the report and give their comments.

Once you put in an offer, notify your real estate lawyer. They will do a title search and may request a bunch of documents related to HOA bylaws and what not. Basically, it’s their job to make sure you’re not being cheated out of your money and to identify any potential legal problems that may arise with the property in the future. Your lawyer will also talk to the seller’s lawyer and to your bank if there are any issues.

There are probably other things you can do too, but these are the ones that really helped us when we purchased our property. We paid several thousand dollars in lawyer fees and realtor commissions, but it was worth it.

[Metalcat]

There really aren't a lot of avoidable fees in real estate.

Your best focus is on finding a good inspector and possibly some good trades folks to check the place out. I have a general contractor I trust who specializes in the kind of house that I'm eyeing in one of the locations where I own. When I see a house I might be interested in, I have him go over it with me so that I can get a sense of things that could be wrong and what they would cost to fix.

The more a professional knows that kind of house in that area the more likely they are to understand the things that could be wrong with it and how big a deal they are.

The less you know about houses, the more you want input from someone who really, really knows the kind of house you are looking at.

This is where you don't want to try and save money. I would rather spend a few grand bringing in a bunch of trades than to not know what I'm really buying.

For example, I didn't know my contractor yet when I bought my Newfoundland house. I had an inspector who wasn't from that area look at the place and he said it was structurally in great condition. But my contractor ended up finding a huge amount of rot and a small mudroom extension that was so structurally rotted that he said it likely would have ripped itself right off of the house within the next year.

He knew the kind of construction that was used on the house and more importantly, he knew that it had been upgraded about 10 years ago and the common errors that were made in the area when upgrading these old houses.

That's why he's the guy I now have look at houses in that area that I'm interested in.

The more specific knowledge your professional has about that specific location/era of build/type of upgrades or renos that have been done, the more you will catch in your inspection.

But at the end of the day, just prepare for shit to go sideways and be expensive. No matter how thorough your inspection, homes can have serious, expensive shit wrong with them. Part of owning is being prepared to handle serious, expensive shit.

I've purchased 4 units in the past 4 years and all of them have cost me thousands in unexpected repairs within the first year.

[joemandadman189]

Echoing the above, get a real estate agent and for sure get an inspection, maybe even request a survey so you know your property corners or pins and ask about the easements. Typically easements are for utilities so things like natural gas, electric, water, sewer, storm sewer lines. in your case for the canal there is probably an easement allowing the canal owner/manager access to the property to inspect, maintain or repair the canal. Land in an easement is still your land, just don't build anything in the easement that cant be easily taken down and put back up or fancy landscaping, as in the case of a water main you could get several trucks and excavators in your back yard if there is a break somewhere.

If this place falls through i would recommend taking a first time home buyer class in your area, lots of good information in them.

[uniwelder]

As @Metalcat said, bringing a contractor or someone that knows construction with you is a great idea.  If you've already done one viewing by yourself, you could always ask for a second showing.  Its unnecessary to tell the seller's agent (though you should tell your own agent) you're bringing a 'friend' and it gets you a preliminary house inspection without going through the formal process of signing a contract first.

If this place falls through i would recommend taking a first time home buyer class in your area, lots of good information in them.

+1 to this.  First time home buyer classes in my area are free.

I also just want to comment on how cool it sounds to buy a house adjacent to a canal.  I'd love to show up at a friend's for dinner by canoe or do my grocery shopping by canoe!

[Metalcat]

As @Metalcat said, bringing a contractor or someone that knows construction with you is a great idea.  If you've already done one viewing by yourself, you could always ask for a second showing.  Its unnecessary to tell the seller's agent (though you should tell your own agent) you're bringing a 'friend' and it gets you a preliminary house inspection without going through the formal process of signing a contract first.

If this place falls through i would recommend taking a first time home buyer class in your area, lots of good information in them.

+1 to this.  First time home buyer classes in my area are free.

I also just want to comment on how cool it sounds to buy a house adjacent to a canal.  I'd love to show up at a friend's for dinner by canoe or do my grocery shopping by canoe!

I'm actually always very transparent that I'm bringing in trades people.

Also, I was buying in very hot markets where no one was making offers with conditions. I got around that by getting inspections *before* making an offer. If the seller wouldn't agree to this, that was a red flag for me.

Granted, I also communicated through back channels that I'm a very reasonable and experienced buyer, that I'm looking for places that need work, not looking to bargain on the price because of problems, and that I know and respect value if it's there. It's made clear to the sellers agent that these steps will make me a lower hassle buyer, that if I make an offer that I know what I'm getting and I'm cool with it.

If I make an offer pre-inspection, I usually attach a an estimated dollar amount of how much I'm willing to spend on the house before I'll back out based on inspection. This tells them I'm not going to bail on the house just because I find a $3000 repair that needs to be done. Again, I'm making it clear that I thoroughly understand and respect value and that I'll happily buy if the house has the value it appears to.

I once wrote "I will go through with this sale for anything short of the report saying it's a tear down." The report said it was a tear down, so I walked away. The sellers then dramatically lowered the price because they knew every deal would fall apart for the same reason, and then they listed it "as is."

My approach is to communicate as much as possible to the sellers (really the seller's realtor) what kind of buyer I am.

[sonofsven]

In the real estate world there's generally sellers agents and buyers agents; you want a buyers agent, specifically one that is experienced and knowledgeable working with first time homebuyers.
Also, experienced agents know which home inspector to call to get an iffy home passed versus a really conclusive inspection that lays out all the faults, which is especially useful when trying to negotiate.

Talk to any contacts you have to try to find a good buyers agent.

An easement is basically a legal agreement that gives the parties involved a framework for their rights regarding the use of the property in question.

For example, you might buy a property with a shared driveway that has an easement for the neighboring owner to use and maintain the shared driveway. And the neighbor would have an easement allowing you to use and maintain the driveway.

Read them carefully, and if you don't understand it get legal advice. A good agent will have experience in this matter as well, and can help find a lawyer if needed.

The agent should be able to set you up with a mortgage broker to determine your eligibility for a loan and the amount you can borrow.
Then, by collaboration with you, find properties that match your wants/needs. Sometimes they will find a property that doesn't match, but you might love it, so stay open minded.

They also will help evaluate the sellers asking price and how it relates to the local market conditions and what your offer could be.

They will write up your offer and work with the sellers agent to keep you at arms length from the deal. Try not to get too emotional about any one property as that is when you are most likely to overpay.

The agent has a bit of a thankless job, working all hours and weekends for potentially nothing if you don't buy anything. The good ones offer exceptional service because they know their business depends on referrals from satisfied clients.

[SunnyDays]

If you have the time and energy, go to as many open houses as possible.  Just for the experience in assessing homes.  You will see all kinds of things, good and bad, that will make you a better judge of a house.  Look at foundations, roofs, electrical panels and wiring if accessible, plumbing, windows, attics, yard slope, positives and negatives of the neighbourhood etc.  Only then, turn your attention to the "sexy" parts of the house, like layout, decor and landscaping.  Because without all of the former factors lining up in your favour, the latter don't matter.

I have a hydro easement at the back of my yard, with one of those diagonal wire thingies running about 10' onto my property.  In the 30 years I've lived here, it's never needed to be touched, but I'm careful not to put anything that would break my heart to have to dig up near it.  For a canal, maybe it might need to be dredged or otherwise maintained periodically (?) in which case you would have machinery on your property.  Just don't put anything difficult to move in that area, and it likely won't be a problem.

[lucenzo11]

1)More than anything I don't want to be tricked into buying something shitty - are there any good checklists that I can work with to guide me through the buying process?

Include a home inspection in your offer. Many people were waiving these when markets were hot and in some areas this is still done, but don't do this, especially as a first time homebuyer. At worst, include an as-is home inspection which means you want to inspect it for your own interest and you won't ask for them to fix anything before the sale goes through. You can still back out if you find it needs too much work. Go to the home inspector so you can follow them around and talk to them. Get them to explain things, ask questions. They'll often suggest to have others come in to do more specific inspections if they see something that is outside of their expertise.

2)I want to understand what I can do to maximize mustachianism by avoiding unnecessary fees (lawyers fees ,transfer fees, applicaiton fees, comissions, etc.)

Unfortunately, not much. The main way people avoid lots of fees is to do a FSBO (for sale by owner) where real estate agents aren't involved, but I would not recommend this as a first time buyer. The other way to save money is to buy in cash (no mortgage) as you avoid the mortgage fees.

3)I'd like help in assessing whether a property is worth buying or not. Any key metrics, ratios, heuristics, etc would be great. I feel as though this is very subjective because I have my own set of priorities and quirks (e.g. this house I'm looking at has a water canal running along the one side and we would be allowed to draw from it)

That's a really tough thing to do, especially to boil it down to numbers. One thing you can do is compare the specs to other houses in the area. Look at square footage, number of bedrooms and bathrooms, size of the land. Your real estate agent should be able to pull up comparables and give you an idea of how the price compares to those. But as you pointed out, you still have to consider other factors like condition, location, etc.