I found a good deal on a house today

[Droopy]

It's an older house in the suburbs. Built in 1905. For that reason it has a lot of charm, but it needs a lot of work. It's a two story home with a living room, dining room, kitchen and full bath on the 1st story as well as a front porch and an enclosed back porch. Second story has three bedrooms and a half bath. Newer improvements include vinyl siding, Berber carpet in the living room and dining room. New overhead cabinets in the kitchen as well as a new counter top and a new sink. Lower cabinets are still ancient. New paint in the bedrooms. Newer furnace and water heater. The back yard is big and beautiful with several large trees. Improvements needed are that it needs central air (there is currently no a/c in the house). It has some galvanized steel water pipes that could be replaced with copper. The hall way leading down to the basement needs the ceiling and walls repaired. Needs new ceiling fans and lighting fixtures throughout. Needs new flooring and paint in the kitchen. Half bath upstairs needs new flooring and paint. Back yard needs a serious landscaping job, but has the potential to be gorgeous. Porch out front needs paint. Could use some new cabinets in the kitchen, but they are usable for the time being.

I'm thinking the house needs about $7000 worth of work to make it nice. Price is $42,900. It is a bank foreclosure. An inspection may turn up more needed repairs. I think I'm in love. I'm going to make an offer on it.

[SmokingJacket]

1. Go for it.

You can spread that 7K out over a few years. It's amazing what you get used to -- I thought we'd gut our gross old kitchen right away, but we got used to it and only gradually fixed it up. It's nice now, and no loan needed.

It sounds like a lot of fun!!

[ms liberty]

2. Sounds promising! Good luck! n/t

[Blue-Jay]

3. Sounds good Droop!

What kind of flooring is in the kitchen now? Homes that old (in your area) usually have some nice hardwood on the first floor, if you dig for it.

[Droopy]

6. It has some old dinged up, stained, dirty vinyl in the kitchen

I didn't check to see if the flooring underneath was good. I doubt it because the rest of the house has the original flooring covered as well. But you never know. I might find some beautiful hard wood under there that just needs refinished.

[Blue-Jay]

10. I bought a house in Springfield some years ago...

It was built in 1900, and it had some beautiful wood under the ugly vinyl floor. A weekend of stripping, sanding and staining probably increased the value of the place by a few thousand toad-skins. I wish I could have picked that place up and moved it to the Chicago area.

[Droopy]

12. Those old houses can be irresistable

I love big old houses. I will even go to see one for sale that I can't even afford just to see what it looks like on the inside.

[Deja Q]

4. Sweet! Good luck with the purchase!!

:toast:

[Droopy]

7. Thanks man

I am pre-approved for the loan. It's just a matter of submitting the offer.

[DainBramaged]

5. Nice, hope the inspection is ok

Charm, missing from the ticky tacky houses built from the 50's-70's

[NMDemDist2]

8. sounds great! if it was built in 1905 it must be the old farmhouse from

the acreage the subdivision was built on

good luck!

[crim son]

9. $42,900? That's a a great price.

I'm pleased for you... it sounds exciting!

[Droopy]

11. Thanks

The people who bought it before me paid 75k for it. The county tax records have it appraised at about 75k. It might just be the best deal of my life.

[Connonym]

13. Can you make the sale contingent on an inspection?

I don't know if that's allowed with foreclosures but if you have a reputable inspector check it out you can make sure you're not getting a money pit. Otherwise it sounds like a sweet deal! Wish there were houses around here in that price range. I definitely second whoever mentioned looking under the floor for hard wood. Even if you hire someone to refinish it it's still going to be way cheaper (and cooler) than the alternatives. Wish you the best of luck!

[Droopy]

14. Maybe

What I can do is ask for repairs to be made by the seller if anything too brutal comes up in the inspection. I don't think they will go for it, though. I'm being asked to sign an addendum to the contract that says that the property is strictly being sold "as is."

[Connonym]

16. If it's a foreclosure they almost certainly won't be willing to cough up for repairs

but at least you'd know what to expect going into the situation and won't find yourself with 15K in termite damage or something. Is it your first time owning a house? It's very exciting! I adore old houses. There's so much character in them. I'm very envious of that price. I couldn't get anything liveable for three times that where I live.

[Droopy]

19. I've owned three previous houses

But they all proved to be too expensive. It was either a case of me misjudging what I could afford or me being the object of downsizing after I bought the house. But I figure that I can work at McDonalds and still afford this house.

And speaking of prices, I live near Dayton, Ohio. If you want a super nice house it's still going to cost you a couple hundred grand, but in the area where I live you can still get an upper class house for about 150k. The drawback to that is that you will not make a lot of money around here. I'm a truck driver and I make around 45k a year. I've heard that truckers in L.A. make $30 an hour starting wage. I've been trucking for 10 years. Get my drift?

[CaliforniaPeggy]

15. My dear Droopy!

You know, it sounded really good....

Till I read "Half bath on the second floor."

Is that a misprint? Because you'll be sleeping up there, you would most likely want a full bath there...

And adding a bathroom is expensive.

Or perhaps you would just expand that bathroom?

Something to consider.......

Otherwise, it sounds like a winner!

[Droopy]

17. You read it right and I wrote it right

I would prefer that the full bath be upstairs. There is room in the half bath to add a shower, but it would likely cost quite a bit just for the extra plumbing. It's something to consider, but I wouldn't worry about that until way down the line after I got the rest of the house the way I wanted it. But I guess it is a weakness.

[CaliforniaPeggy]

18. It's only a weakness if you choose to let it be one....

I was just remembering the house my husband and I raised our girls in...

It was odd in that all the bathrooms were on the main floor...

Our bedroom was on the lower level......

After two years living like that, we decided to add a BR to our space downstairs...

But we did just fine with the BR on a different floor.....

I suspect you will too....

[flvegan]

20. Find out how much the Final Summary Judgment was at the f/c

(it'll be in the public records). Make sure that the bank/successful bidder hasn't raised the price from that too much. Also, find out when the sale was. You'll know how long the bank/buyer has been holding on to it.

Also, if it's bank property, you may have some good negotiation room. The REO market pretty much sucks across the board, and banks are turning into real estate holding companies, practically.

Your lender will demand an inspection, and that's a good thing. Considering the age, it might be more than a 3-point inspection, too. You might also be able to get a good low/no interest loan from your city/county for the improvements (many municipalities have home improvement project loan programs).

Big questions: is it on a well/septic system? You definitely want those looked at.

Either way, I hope she's a winner for you!

[Droopy]

22. The house has been on the market for 60 days

The previous owner who got foreclosed on paid about 75k for it. That was 2 years ago. I don't know anything about a Final Summary Judgement.

It has city water and sewer.

[necso]

21. Some things to consider:

* Security/safety, particularly if you're gone a lot.
* Your job security.
* Some older houses are poorly insulated, resulting in higher heating/cooling costs.
* The roof.
* The foundation.
* In older homes like that (in northern climes), it's fairly common to just cool a room/two with individual AC units.
* A little reconditioning on those older cabinets might do the job. I've repaired drawers, made new doors, etc -- it isn't that hard.
* Get a credible(!) inspection even if you have to pay for it.
* Have a cash reserve that can carry you for a while, pay unexpected bills.

[Droopy]

23. Answers

*It's in a low crime area
*Job is solid
*Will know more about insulation pending the inspection. I'm going to look up the average payment on utilities.
*The roof is tin and sealed. There is no water damage upstairs.
*The foundation is stone, but it was dry in the basement when we looked at the house and we've had a lot of rain recently.
*Gotcha on the a/c
*Ditto on the cabinets. They are not my main concern.
*I will definitely pay for a good inspection.
*Liquid cash is cool. I also have very good credit. Average score was 740. We will do a search for overdue bills to see if there are any (water, taxes, etc.)

[Whoa_Nelly]

24. If you can, get an ASHI inspector (American Society of Home Inspectors)

ASHI has the strongest criteria for the home inspection biz

You can enter your zip code to find ASHI inspectors in your area:
http://www.ashi.org/

[necso]

25. What? No colon?

I was also thinking about cracking/shifting and attachment to the framing with the foundation (although this last is more of an issue in areas of specific hazard).

A "tin" roof (a newer one especially) can be very good.

Reinsulating a house is a pain. But you can do it a room (outside walls) at a time (although plaster is a particular hassle; replace it with wallboard). If you do reinsulate, I'd go with high R-value stuff. And just reinsulating the roof/attic/top-ceiling and sealing windows/doors/floors can go a long way.

The price sounds like it has dropped about what is to be expected (in a severe market recession).

And as just straight paying-for-housing, it sounds like a good deal. A little weekend work is well worth it, when you can have a nice garden, grow fruits and vegetables, etc.

[necso]

27. Addendum:

A good EER rating of a modern, inexpensive window ac-unit is 10.8 (SEER roughly 12; using SEER = EER ÷ 0.9; which might underestimate calculated SEER). A good central-air unit has a SEEP of 18 (EER roughly 16.2). This would translate to requiring 50% more electricity (on top of the lessor demand; 1/3 off the higher demand) to cool the same area. But since you'd be cooling nothing like the same area (the concept behind using one or two window ac-units, like in bedrooms -- so that you can sleep, take a break from the heat), the cost (and energy) savings should be significant, although leakage from the cooled-down areas will defy straight percentage calculations (interior walls, doors, aren't as well insulated/sealed as outer ones typically). (Even if it cost twice as much, half the area is the breakeven point.)

However, there is some data that owners of central-air use ac more hours than owners of window units (sticking it through the wall is a monstrosity).

If you want to spend serious money to save serious energy (but get paid back in fairly short order), check out geothermal-exchange heat-pump systems.

[ScreamingMeemie]

26. Appraiser chiming in...please don't do window a/c. Go with central.

For the money you "save" buying a unit, you lose it in energy costs. Plus, resale value is astronomical for C/A. Window units detract from a home.

[EFerrari]

28. Sounds so good, Droopy! Good luck with the deal.

:toast:

[Droopy]

29. Thanks. I might need the luck.

Realtor says she has to wait until Tuesday morning until she can submit the offer. She is just look for anything that might be wrong with the house financially, i.e. overdue utility bills and taxes. Pending that and no offers in between here and there and I should be good. I'm already pre-approved for the loan ammount.

[EFerrari]

30. Sounds like you've got yourself a good agent.

There's always that period of uncertainty to get through and it looks like you are in good hands. That's really important.

I myself am thinking of selling this little overpriced place and getting a house on the delta. I love the beach but it's just weird to be on the second floor and to have no yard for my dog or my roses. :shrug:

Let us know what happens!

/oops

[Droopy]

31. I certainly will

I will post a thread with the subject line "I got the fuckin' house!" :)

[EFerrari]

32. LOL!

Crossing everything. :hi:

[dysfunctional press]

33. $7000 doesn't go very far...

just from what you described, i'd guess about twice that- if you plan to do all the work yourself.

[Droopy]

34. I have rehabbed a home in the same area

It cost me about $16,000 and I did the work myself. It was far worse than the house that I plan to buy now. I put a new kitchen and bath in that house as well as a new roof. This house doesn't need any of that. The only thing that I will have to have done in the current house as far as contracters go is the central air. I didn't check your profile to see where you are from, but remember that houses here in the midwest are far cheaper to buy and repair than those on the east and west coast.

[dysfunctional press]

35. i'm in chicago.

and i'm on my fourth rehab here.