Author Topic: Advice on getting a deal on home in the next 6 months  (Read 2490 times)

FastStache

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Advice on getting a deal on home in the next 6 months
« on: December 24, 2013, 01:19:42 PM »
I'm looking to save up money for a house much closer to work. I currently have about 17K in cash and my tax return should be in the neighborhood of 4K+. We are going to save aggressively over the next 6 months and hopefully save up another 20K by June. We are going to be looking at homes in the $175-250K range.

Should we start to shop soon or wait until we have more money saved up? Are there any events coming soon like interest rates rising or something to make it harder to get loans for the general public that my drop prices? I would like to get on it now since I know home prices tend to jump up in the summer.

I'm on the fence about what to do about my current house but I should be up about 45K at least without taking into accout selling fees. One thing I would like to do is time the market with the sale of my current home. This house would be close to 0 profit by renting it out, but I think I would be ok with that if it meant a higher selling price in the future.

Monthly Savings due to moving closer
Gas: $150
Tolls: $100
Car maintenance/repairs - $40 (estimate savings on wear and tear and repairs)
Property Taxes: $120 - my current property taxes are much higher than the area we are looking at.
HOA: $75 (looking for no HOA)
Electricity: $? (looking to downsize but house will be older)
Car insurance: $80 (maybe)

ShortInSeattle

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Re: Advice on getting a deal on home in the next 6 months
« Reply #1 on: December 24, 2013, 05:17:24 PM »
I'm afraid my crystal ball is broken. No one can tell you what the market will do.

I do believe the assumption out there is that the RE market is recovered in most areas and improving, with rates either staying steady or slowly climbing. That may indicate rising prices, but I believe every locality is different.

Is there a good blog for your local market that can provide you with some data on recent trends? The Seattle Bubble blog is our local example.

One way to get a deal is to be willing to put in sweat equity, if you are so inclined.

I think it is hard to time a house purchase, particularly in the short timeframe you are talking. You could wait for the next housing "crash" of course, bit that could be years and years away.



FastStache

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Re: Advice on getting a deal on home in the next 6 months
« Reply #2 on: December 25, 2013, 06:56:32 PM »
Ha, I guess I read some things online saying it will get harder to get financing early next year due to some new federal regulations. I wanted to know if someone else had some insight on this.

I will read some of the blogs I've found to see if they are any good.

If your crystal ball starts working let me know.

jamccain

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Re: Advice on getting a deal on home in the next 6 months
« Reply #3 on: December 25, 2013, 11:52:27 PM »
In general, it's better to start the process early, especially if you don't have a lot of experience.  Get a sense for the market and what your money can buy.  Check out ALL options...there may be an area you weren't thinking about that works out better for you that you aren't considering just yet.  Give yourself time to figure this all out.

Work with someone experienced and patient...who doesn't mind helping someone going through the process. 

Doesn't matter what the market or interest rates are doing.  You have to get ready...when you're ready, you're ready.  Don't let fear of  what the "market" may or may not do rush you into a decision.  I would also add an emergency fund to your savings prior to the house purchase.  It's a lot easier to move into a cheaper apartment when crisis hits....once you buy the house you won't have that option and you won't be able to sell for several years.  You have to be MORE conservative with savings when you own a house.  Not to mention, they are expensive...way more so than you expect them to be...every new homeowner I know has said this...they are money pits. 

If you want to do a great job with this house purchase...buy something you're going to live in for a very long time.  That's probably more important than anything else you're talking about and is often very overlooked (things change and it's hard to know what the next 20 years will hold, but buy one house for several decades and you'll have done GREAT!).

My crystal ball says success lies ahead. 

FastStache

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Re: Advice on getting a deal on home in the next 6 months
« Reply #4 on: December 26, 2013, 02:13:50 PM »
Thanks for the advice.

I'm going to try and buy something under market value by using good ol' sweat equity. Does anyone have some good ways to get good at sweaty equity? Attend home depot seminars, walk the aisles of hardware stores to know prices, monitor craigslist? Any good online videos on how to do simple tasks? I'm not looking to be able to redo a roof or serious plumbing, but some things that can go a long way in saving tons of money upfront on the purchase price.

jamccain

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Re: Advice on getting a deal on home in the next 6 months
« Reply #5 on: December 26, 2013, 03:21:39 PM »
Habitat for Humanity, or volunteer to help MMM reno his current housing project.