Current Events > Just made an offer on a house for $1.7 million

(+) Yeah! (+)

What about my question, TC?

5000 sqft house
lot is about 0.75 acre

If a $1.7m property is expected to be $5.7m in 25 years... How the hell will people get their foot in the door in the future lol

Congrats btw. I'm looking to do something similar in Orange County

XxZiomaxX posted...

If a $1.7m property is expected to be $5.7m in 25 years... How the hell will people get their foot in the door in the future lol

You dont. Corporations price out the Everyman and the only people who own homes are the uber-rich or have family heirloom homes.

Im trying to sleep on which house to put an offer on.

house 1:
5,000 square feet, 2.5 acres, 8 bed, 8 bath, 4 stories, detached 2 car garage, under $750k. 1 good kitchen, 1 ok kitchen, all bathrooms small and suck, most bedrooms small and suck. Sounds like its mostly rented to visiting nurses $600 a month per bedroom, so $4200 per month.

no good living quarters for me.

House 2
3200 square feet, 5 bed, 3.5 bath, 2 car attached garage but cant enter house from garage. Asking under under $700k 2 really nice kitchens, bathrooms are really nice, each floor could easily be a living unit, studio above garage could be living unit with like $30-50k invested. Very nice and livable house.
I could live on bottom floor, rent out top floor for $1500-1800 a month, rent out studio for 800-1000 a month. Beautiful 180 degree views, close to work, close to down town.

I literally evaluated and considered every possible factor I could think of. I discussed the decision for hours on end with my most trusted people whose opinions I actually value. This was the most complex and toughest decision of my life. Since a day before I made this topic I could not sleep up until last night. I've been sleeping for 4 hours at a time then waking up at like 3am unable to fall back asleep cuz my mind would be racing with pros and cons and I flipped back and fourth all the time.

Now as the days go on I feel better and better and I went from being extremely nervous to very excited and can't wait to move.

I intend to live in this house forever. So I don't care if i'm buying slightly high. I might be overpaying by like 30k but fuck it because that is what it took to secure our dream home. And over the time frame that we'll own, the price will go up, inevitably.

In my experience its a very bad idea to become deeply invested in a significant transaction.

Sure do your research, shop around, etc. But the second you cant turn and walk away from the deal is when youre about to get screwed.

Glad it worked out for you.

Why do you care so much about the value going up if youre gonna stay in it forever?

FLAMING_EVIL_HOMER posted...

Why do you care so much about the value going up if youre gonna stay in it forever?

Because we sadly keep subsidizing home ownership in a way so that people want it to be an investment. Meaning they both want housing to be affordable, but also want housing to significantly keep increasing in price (once they buy the property of course).

FLAMING_EVIL_HOMER posted...

Why do you care so much about the value going up if youre gonna stay in it forever?

As a backup scenario if I have to sell it for whatever reason. I anticipate staying forever but at the same time I acknowledge that its impossible to know how I'll feel 20-30 years down the line or what hardships we'll face over that time-frame. So the value going up provides a safety net for alot of potential problems down the road.

Yeah i just moved into a house and im just happy to have one.
Couldnt care less about the value going up or down because we also expect to live here for a long time.

People thinking like that is what is making the housing market as toxic as it is anyway.

Its crazy I grew up in a 1000 sqft house built in the 1940s, shared a bedroom with my sibling for most of my childhood. Now I'm buying a 5000 sqft, 0.7 acre lot with all modern features, in one of the nicest neighborhoods around. My mom almost started crying when I showed her the house.

Apparently theres some dry rot and a small area of possible subterranean termite evidence, all section 1 stuff, we're getting quoted 7k to repair. The sellers seem like assholes who probably won't budge or offer to fix. Even their agent is an asshole.

Dan_Haren- posted...

Apparently theres some dry rot and a small area of possible subterranean termite evidence, all section 1 stuff, we're getting quoted 7k to repair. The sellers seem like assholes who probably won't budge or offer to fix. Even their agent is an asshole.

Was there an inspection contingency in your offer? If so did you have one done by an independent contractor prior to signing anything?

Honest question is it "Caveat Emptor" in America on houses, surely not?

TheSuperSilver posted...

Was there an inspection contingency in your offer? If so did you have one done by an independent contractor prior to signing anything?

No i didnt. Its "as is".

Dan_Haren- posted...

No i didnt. Its "as is".

For a $1.7 million dollar house? Why would you do that to yourself? Now you're on the hook for anything that may come up.

I don't know how you claim to have thought out this process for as long as you did and totally fail to throw in any contingencies in your offer. Who the hell knows what all else might be wrong with the house.

If someone was trying to sell me a house only to be sold "as is", I would be waving a big red WTF flag.

I just bought a house too but mine was 425k.

Decent house/neighborhood in one of the cheapest areas of So Cal.

Thats a good price now days actually

Some houses in Wisconsin can for 10-20 million just for basic two or three story homes. Cheapest was about 60,000 - 100,000 for a tiny home with a big yard something that would do 1-2 people good.

I estimate total repairs of the house are going to be about 10k, and its going to cost another 5k for our personal modifications before we move in. I can live with that. Its a hot market and there were 2 other offers and they just had open house. So we wanted to jump ahead and made a decent competitive offer. In retrospect yea that would've been smart but I'm not losing sleep over 10k for my dream house.

Dan_Haren- posted...

I estimate total repairs of the house are going to be about 10k, and its going to cost another 5k for our personal modifications before we move in. I can live with that. Its a hot market and there were 2 other offers and they just had open house. So we wanted to jump ahead and made a decent competitive offer. In retrospect yea that would've been smart but I'm not losing sleep over 10k for my dream house.

Yeah I mean if you afford to pay that then it's no issue. I just know that a home sold "as is" is done for one of two reasons - to save money and/or to save time.

For my house, we made sure to lock in both an appraisal and inspection contingencies. The appraisal would have allowed us to walk away if the appraised value came less than our offer and the inspection would have given us a lot of leverage to negotiate (or walk away from the deal) if there were serious issues with the house.

TheSuperSilver posted...

Yeah I mean if you afford to pay that then it's no issue. I just know that a home sold "as is" is done for one of two reasons - to save money and/or to save time.

For my house, we made sure to lock in both an appraisal and inspection contingencies. The appraisal would have allowed us to walk away if the appraised value came less than our offer and the inspection would have given us a lot of leverage to negotiate (or walk away from the deal) if there were serious issues with the house.

tbh in retrospect yea i should've done that but it is what it is. We have some suspicions now on their selling plans...they have a new property lined up for early May, so they probably did want to save time. And they had this property listed for almost a year and they kept slowly cutting the price and even then it was overlisted up until now. We big about 50k under asking and it got accepted and even then I think we overpaid by about 20-30k. All in all if I did everything right I probably would've saved like 40k but if I went that route I might not have even gotten this house. And inventory is so dry right now, this is one of the hottest neighborhoods in sacramento metro which includes about 2.5 million people. And I think theres some human bias in what we valuate houses at. You almost have to bid above what you think its worth because otherwise there will be multiple offers for what the census is for its actual value.

Property listed for almost a year and nobody bought it in what you claim is a hot neighborhood? Did you ask the owners about that? Or even your realtor - a good realtor should know what's what on the homes in his/her area.

I dunno this seems fishy to me.

CA CE meetup at this guy's house.

TheSuperSilver posted...

Property listed for almost a year and nobody bought it in what you claim is a hot neighborhood? Did you ask the owners about that? Or even your realtor - a good realtor should know what's what on the homes in his/her area.

I dunno this seems fishy to me.

It was way over listed and the winter months were slow. It was disproportionately overlisted for how high rates were. I think now it's coming back down to a reasonable number

[LFAQs-redacted-quote]


~170,000

10% down with a physician's loan, no PMI

Just sent them a request to pay for the repairs which are about 10k. We'll see what they say.

Went for another look at the house again and I'm more sure than ever this is the right decision.

They agreed to all repairs. $5k credit for some things they cant do in a timely fashion and they will cover all of section 1 and 2 which is about 7.5k and they'll cover some other things like roof repair and cleaning, chimney was cracked, ac/heater vent not working in 2 rooms, etc, so all in all probably saved about $18k in repairs at least, if not more cuz I hadn't gotten roof or chimney estimates. It also saves us a huge headache not having to shop around for estimates to get these repairs done. Now we only have to worry about little things to customize to our liking.

Dan_Haren- posted...

cuz I hadn't gotten roof or chimney estimate

... right

MrResetti posted...

... right

The roof inspection guy only did a visual with a drone because the pitch was too steep. He listed off what needed to be fixed but couldn't give a proper estimate since he said he doesn't do that steep of a pitch.

Once all this stuff settles my next mission will be the research trusts, pros and cons, and how to set one up potentially. Ideally I put all my investments and assets (including house) into the trust. So if something happens to me it can easily be passed on to my kids and/or if I become liable or bankrupt or whatever the trust would protect my assets.

Dan_Haren- posted...

The roof inspection guy only did a visual with a drone because the pitch was too steep. He listed off what needed to be fixed but couldn't give a proper estimate since he said he doesn't do that steep of a pitch.

Is the roof ideal for solar? Have you given any consideration to solar?

Dat_Cracka_Jax posted...

Is the roof ideal for solar? Have you given any consideration to solar?

It has solar, we would have to take over the lease, which is annoying because it's expensive and we don't get the tax benefits of it