Please give me some house hunting advice - YouLookFab Forum

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Please give me some house hunting advice

elpgal

Veteran

Some background: we have been looking for a single family house for over a year in a tight market where houses are priced high and sell within 2-3 days of listing. Just today we were slated to attend an open house for a property that was listed yesterday evening and it is already off the market. Since last year, we have saved like mad and increased our budget by almost 20%. So far we have been unwilling to compromise on schools, sunlight in the house, a small backyard and a minimum of 3 bedrooms (DH works out of home). But as another hectic season of home buying comes to a close, we realize we have to make some compromises. I am constantly on the local real estate forums but decided an outside perspective from you wise ladies will be helpful.

So, tell me which of these matter least in the long run? We have been looking for areas where schools score at least an 8 on Greatschools. We did not grow up in this country and don't know how to assess the education system better than going by schools scores which I understand have limitations. Where I grew up, folk build their houses so this is all very new to me. Any other words of wisdom you have for me are most appreciated.

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16 replies

Latest reply was from Jules

carter

Veteran

Hi, elpgal. I am a real estate broker in Atlanta. Are you in the US? It doesn't sound like you are working with a buyer's agent? Or, if you are, she's not doing her job. A good agent can get you into new listings either before or immediately after they are listed. If you don't already have it, you should get a current pre-approval letter from your lender to submit with any offer you make. Don't be afraid to make back-up offers. Unless you live in GA, I can't give you any specifics about the process, the market or the role of your agent, but I highly recommend that you speak with an agent in your state (assuming you are in the US).

In terms of where to compromise...don't compromise on anything important to resale that you can't change personally. For instance, you can't change the location, the busyness of the road, or the school district, but you can tear down or put up interior walls, add windows or convert existing windows to French doors, finish a room in the basement, etc.

In a seller's market, even homes with "fatal flaws" will sell. Just don't be the one to buy it. When the market inevitably tanks again, fatal flaws (super busy road, next door to hospital or fire department, giant power line in the back yard, etc) will hurt you in resale.

elpgal

Veteran

Carter, thank you for your thoughts. I am in the US and we have an agent from a full service brokerage. We picked her because she is local to the area where we want to buy. She has set us up with alerts and software but I find that we are able to find the listing the minute it hits the MLS. We email her immediately to set up a time and also ask her to contact the listing agent to see how offers will be presented. Even so, we have missed out on several good listings in our price range. After I read your reply, DH and I have discussed the possibility of changing agents. Thanks for the tip about back-up offers, I didn't know that was a possibility.

We are pre-approved so that is taken care of. We also lost out on a couple of houses because were unwilling to waive the home inspection contingency. Ours is very much a seller's market and inventory is very low.

Kim

Veteran

Do not waive the home inspection, if they require that you'll be sorry down the road. I'd be highly suspicious of anyone who asked me to do that.

And remember that markets cool. In a year or two you may have a buyers market and you'll be able to purchase what you want, but you may have to be willing to wait til then if you aren't willing to move on your musts. (Which don't seem unreasonable to me at all.)

Can hubby build an office in a walk out basement (do they have them there?) or perhaps have a huge bedroom (or family room) professionally divided into two? Remember, that with a good contractor the only things that can't be moved, or knocked out are the load bearing wall, and the exterior walls (and they can be moved to for the right cash! LOL) so if you like the shell, and have the cash you can gut anything and renovate to your own needs (Not for the faint of heart though...)

Not sure what else might work there, because 3 bedrooms is pretty much what any house around here would have at a minimum.

I know nothing about school scores (I'm in Canada) so can't make any suggestions there.

I'm sure you've thought of all this before.

On the really crazy side, have you thought about buying something really really bad, tearing it down and building what you want on the space? (Is that even an option? Like I said, really crazy...LOL)

Try not to stress too much, as I said, markets turn, and then suddenly you have tons of choices, it's just a matter of time.

Thistle

Veteran

I can't ofer a lot of suggestions on the market.

What I can say is that a home purchase, for most people, is the largest single purchase you will ever make. None of your requirements seem unreasonable. Waiving a home inspection is never a good idea.

Worse than not getting a house is getting one over priced that requires a ton of work you didn't know about when buying. It can be financially and emotionally draining.

As for schools . . . Gosh, that is so tough. Yes, rating help, but they only tell part of the story - usually how good the school is at preparing kids for tests. I am not sure what part of the country you are in, but by me, the bad schools are so highly publicized. But then our bad schools are really bad, like bottom 10th of the country bad. It's a big reason why Milwaukee county struggles to bring middle class people back into the city.

Anonymous

Lots of good advice - especially about not buying a home with negatives you cannot change. The structure can be changed, granted it takes money. It can be a worthwhile process, especially if you plan on staying in the house for many years.

School scores can be a bit misleading. I think the scores are good at identify the schools that are failing but I think they do not tell the whole picture for most schools. We have very highly, 9-10 rated schools in our area with a few 7-8 rated schools. The real estate prices follow the school ratings very closely. I know a few families that have kids in the schools in the 7-8 range that are over the moon about their schools. They have found a very involved community, dedicated teachers, and families with a like-mindedness on education. Whereas, I have another friend who teaches at one of the most prestigious public grade schools on the peninsula and she isn't impressed with the school at all. She feels that the high rating is due to the demographics of the school and parents sending kids to after school academic classes. She feels the school does not push the kids, takes the easy route if you will.

Is there a moms group in the area you are looking at? Join the group and start asking questions. Most moms are either trying to figure it out just like you or have kids in the school already. They can be a great source of information on schools. There is nothing wrong with calling/visiting the school and talking to the principal, PTA, or teachers. You may not get all the answers you want but you will become more familiar with the schools and be able to get a sense of what is right for your family.

N-Marie

Veteran

We are buying in a very similar market - houses sell in less than a week, often for all cash, 10-20% over ask and with all contingencies waived. We have done tons of research on school districts and have zeroed in on the areas of interest to us. Is Redfin (a free real estate website) available in your area? We use it to track new houses as they are listed- they have an iphone app.

You've gotten great advice so far- school rankings can be misleading and it may be more important that the school is a good fit for YOUR kids. Some of the most highly ranked schools in our area are extremely rigid and high-pressure and we would not want to put our kids in them despite their rankings. Some of the scores may also reflect demographics and the abilities of the kids going in to the system (ie English as first language or not) rather than the quality of the instruction per se. Some highly ranked school are better at serving high-achieving kids while leaving kids with learning disabilities or those with non-STEM strengths (artistic, etc) behind. So talk to parents, talk to teachers, talk to people with older kids who have gone through the system.

My only advice on houses is to try, even in a tight market, to not compromise on something that can't be changed in the long run (bad location or tiny lot).

Laura (rhubarbgirl)

(website)

Veteran

We are also in a pricey, tight market so I feel your pain. We looked at hundreds of places and made several losing offers before we finally got our place. In the end, we decided to compromise a bit on location so that we could get more space and a newer build, with less competition.

Are townhouses an option for you? They can be cheaper but have more room, including a yard, and are often newer as well.

We don't have kids but I've been told that the school scores are not all they are cracked up to be. In an area like ours the test scores are low in aggregate because there are so many kids who are English as a second language. That's not predictive of how a particular kid will do, especially with involved parents.

DonnaF

Veteran

Yes, yes, I highly agree with what has been said about schools and scores. I know a number of parents who sent their kids to highly ranked schools, and the schools did not work terribly well for their kids. High scores are also related to SES (socioeconomic status), and I've noticed that a number of higher income parents get tutoring and the like for their kids so the tutoring masks inferior teachers. High ranked schools, especially private schools, work very hard to avoid negative publicity or anything they regard as negative so you have to dig.

Engaged and active parents IMHO are the best predictor of a vibrant school as well as an effective principal. Schools can coast for a couple years, but a bad principal can be toxic. A great principal needs to be able to lead and mentor teachers and staff, work with the students and their parents, and know how to get what her school needs from the district administration.

Do you have kids? Keep in mind that school boundaries can change and that real estate agents don't always know the latest information so to be 100% safe, you need to do your own research.

elpgal

Veteran

I have been reading your replies and appreciate the advice. Thank you validating our reservations wrt waiving contingencies and buying houses with obvious flaws. I belong to some parenting listserves but will send in requests to join some in the areas we are considering.

Kim: Some houses do have daylight basements but a lot of them are the 'well' type. In our price range, most of the houses have a family room, a half bath and some unfinished sq. footage for storage, washer-dryer. Perhaps a workshop if you consider houses a decade older.

Laura, We considered townhouse but found to our dismay that in our area, they don't come with yards and have hefty HOA fees to boot. They are newer and have nice updates, so cost-wise they are right up there with the older SFHs we are looking at.

Donna: DS is 2, so we have a while to go but want to be settled in this area so we can find and build community. This is something that we have realized we are sorely lacking in our current rental situation with a highly transient population.

RB

I'm not in the US so won't comment on schools.

I do agree with Carter though, I don't think that your agent is doing a very good job. Again I know nothing about buying property in the US, but I don't consider setting you up with alerts and software particularly pro-active and it isn't going to help you access properties before they hit the market.

Personally I'd look at changing agents and find one who will take the time to understand your needs and wants (and who can then help you with compromises if you need to make them) and who will be proactive about seeking out that property for you including being able to access and locate properties that haven't come to the market yet - and who will call you to arrange viewings as early as possible rather than waiting for you to see something on a website and call them.

Helena

Veteran

I'm not it the US either, so I can't say much, but I will echo the thought around sticking to your budget ... buy conservatively, so that you can sleep at night

kkards

Veteran

i don't have a ton of advice, but would second changing agents. before i bought my condo i actively went to open houses of all kinds to shop for an agent. i actaully found my agent about 6 months before i even started to look for houses. yes, there is so much you can do on line these days, but honestly, you are probably only going to buy 1 or 2 homes in your lifetime, and you want a pro who can help you thru the process.

Jules

Veteran

Just for context, I'm in a similar-sounding market and even 10 years ago we had to make an "unconditional" offer, not contingent on inspection or financing, to have any chance on a desirable house. At the time most people got inspections before they made their offer (even though chances were they would lose out in a bidding war), but sounds like you won't have enough time to do that before the houses sell. These days locally, I believe the sellers generally get a home inspection and provide the results (probably helps fuel the bidding wars!) so it's not as much of an issue here any more. Anyway, all this to say, no one will ever recommend that you buy a house without getting it inspected. It's not the smart thing to do. But in some markets, it does happen and does not necessarily indicate the sellers have something to hide. It just means it's such a sellers' market that they do not have to take any risks on your offer because there will be another offer that meets their demands.

As for schools, I agree that community is everything. Our local schools do not have great ratings, but people love them. We were priced out of the nearby areas with "great" schools and have absolutely no regrets. I would actually be around active involved parents who make their school great rather than "buy" themselves a great school district. However I understand my Toronto, Canada perspective might be pretty great relative to some other areas that have truly failing schools.

Gaylene

Veteran

I personally agree with Carter that a good location--meaning a location without fatal flaws--is major. Added bonuses like proximity to transit and shopping, good lot size, parking, and a commonality with your nearby neighbors are all added bonuses.

Lower down on the list would be the house itself because houses can be altered and repaired as long as they are structurally sound. House inspections are a mixed bag, unfortunately. Although they sound good in theory, in reality they are only as good as the inspector who performs them and even the best of inspectors can't see inside walls so forgoing an inspection in a hot market isn't always as crazy as it might seem at first. I actually think using your eyes, ears, and nose can tell you quite a bit--curling shingles on roofs, a musty smell in a basement, sloping floors, cracked foundation walls, tangled wiring in the basement, and cheap-looking renovations can all alert you to potential problems. A house that looks lived-in, but well-cared for, is probably a better choice so look beyond the current state to the potential of the property to fit your needs.

School ratings are volatile and, as others have pointed out, only tell part of the story. If your son is 2, he won't be looking at at academic career planning for another decade or so and a lot can happen in that time. It might make sense to expand your school scores to those schools in the top 50% instead of restricting your choice to the top 15%. My sister was the principal of the top-ranked middle school in her large city and had parents who bought in her neighborhood just so their children could attend her school. She often tried to tell them that, while her school had an excellent academic rating, there were many other schools in the city that were just as good, if not better, in other aspects. I don't think that choosing an area with a school that ranks in the top third is necessarily compromising.

cloud9

Veteran

I live in an area with high test score rating (in CA the government provides score for all public schools). In today's market, any house in decent shape/location is gone within days (for rentals too). The ones stay on market are ones with some significant flaws or asking way too much $. We also have lots of cash buys so very hard to compete. Seriously I've known people draft up offer not even seeing the house! So may not be the agents' fault.

Backup offer is good idea. Also maybe look at foreclosed properties. Warning that it will take longer to get seller bank approval, and watch out for back taxes.

Another thing is to buy off season. Spring/summer is usually hot seller market (esp for the good school areas).

Home inspection should not be waived. Esp if there is unpermitted work done in the house. Don't compromise on location (busy street etc). Just think about the reasons that you DONT want to buy a particular house. You will sell one day so avoid those traits.

Practice Angie's PPP principle.

Jules

Veteran

I like Gaylene's suggestions for checking out the houses yourself. Also, if the housing stock is all similar, by talking to neighbours, good agents and local contractors you can get to know the common issues that a home inspection might turn up, and the costs to re mediate them.
Full disclosure: we did not get a house inspection. It worked out fine for us, but there were some extenuating circumstances that made us more comfortable: we happened to meet the neighbours on the other side of the semi, who by coincidence were friends with our agent and chatted with us about the house. 10 years down the road, everything that turned out to be "wrong" with our house was highly predictable given some local knowledge of how our area's 100 year old houses work and age.The general ballpark prices to fix these issues are also well-known, our agent could rhyme them off and give us the names of good contractors her clients had worked with. I am personally more wary of older houses with more renovations because that is where unexpected problems seem to turn up. Some of the renos might look amazing and high end but lack hidden things like insulation or support beams. A house inspection may or may not turn up those issues either.