The Complete Home Buying Do and Don’t List – Leaked

This is a list of the things to consider before you buy a home. I am an experienced Realtor and you will not find this list anywhere on the web.  It is the real deal. It is an insider’s leak of what really goes on in real estate.

The ethics of Real Estate

Fact: Real estate is regulated and Realtors have a code of ethics.

Fact: Caveat emptor – Let the buyer beware  – when buying you sign a series of contracts that waive your rights for legal recourse and put the responsibility on you. Realtors just ‘show the house’.  You sign disclosure forms that you understand the risks, take the onus, and we have no information. They can not mislead you , they are masters of the obvious, but it the unspoken things are the things that will bite you.

Attention, if you have an interest in buying a home

Read or print out my check list list rather than saying,’yeah I know that’.  I want you to be happy and have home sweet home, and not regret your purchase.

The List: Low quality house “Don’t” buy check list

Location hazards

1. Near train tracks – we live a mile from the train and still hear the whistle. I would say anything much less than mile is not good, if there is a whistle involved. You can buy wooden (i.e. non-toxic)  acoustical panels from a company like Rulon that can help.

   

2. Highway in the distance – listen to the noise, see if you can hear the road. Go during rush hour, not at 2pm on a Sunday.
3. Busy street – By this I mean you want to step outside you house and walk your dog or pull your kids in a red PF Flyer wagon and not have to dodge traffic.
4. Dangerous neighbourhood – Realtors say, look up the statistics, but crime does matter for home values.  Here is a good source for demographic information Demographics of real estate
5. Near an airport – besides the noise, increase rate of “C”.
6. Near power lines – People will say this is harmless. Get real, and really think about the human body. At the very least, others do not like it and this will dampen the appreciation value of your home.
7. Near community septic – most communities have these or anything that smells.
8. House too close to neighbours – I do not like looking out my bedroom window and seeing my neighbours bathroom.
9. People traffic – too close to a store or bar or anything that translates to people traffic, noise or lights.
10. Too close to a touristy street  – first month it is great, but do you want drinking people wandering around your area at night.

    

Location undesirable

1. Backing up to another house – Not a Thomas Kinkade, more like some builders dream to converse space and maximize profit, but why should you pay for this?
2. Neighbours that have junk in yard – Not a nice site, driving buy junky cars and stuff on their yard year after year. One guy has a permanent tent in his yard.
3. Everyone in the neighbourhood is selling – Why is that? The trend is your friend.
4. Plans for a new construction –  or road near the house or in the back yard. Even the potential for just beyond the  backyard to be developed.
5. House next door sketchy – or people you deem sketchy – This is your life.
6. Neighbours that hang out – and are loud.
7. Lights from the road – or cars that drive by shine lights into your house.
8. Schools are not good –  Even if you do not have school age children this is a sign that something else is wrong in the area and you will have a resale value issues.
9. Neighbour that would make the spouse jealous – for example, you do not want a neighbour who mows their lawn in a bikini. I know this seems trivial but man, do you want that everyday?
10. Drive time it takes to leave the community – Sometimes it takes fifteen minutes to leave the community with the winding slow streets. This gets old fast. Do go to the market it adds a half hour to your commute.
11. House with no elevation – Poor planning can lead to a number of issues.
12. Right of way or people that use part of the yard – you would be surprised, even if not on paper, people use other people’s yard and boundary lines are not marked. Parking issues are another issue.
13. Any neighbourhood that has rules – like you cannot have your garage door open. This is more a pet peeve. I like to work in the back and sometimes I do not close my garage. It’s clean inside but I do not want some old lady with nothing better to do than watch at other people, giving me a community ticket.
14. Corner house – traffic and crime.

Toxic – do not play games with your health

1. Did it ever have mold – If it had it once unless it is professionally treated with a certified person, it will most likely come back. In fact in most state you need to be certified. A guy from craigslist is not allowed. I know, sounds expensive, but the stuff it nasty and hard to get rid of. Indoor pollution is often worse the outdoor.

   

2. Granite – bathrooms and kitchen counter tops often means radon. Some people say it is not much but I do not like the exposure. I know someone who never smoked who checked out because of “C”.
3. VOC paints – can gas off for years. This includes floors or almost anything you buy at Lowe’s or Home depot or is used in building material.
4. Chinese dry wall – black copper in garage could mean Chinese drywall. Big in the mid 2000s, will cost you a fortune if you do not look for this.
5. Popcorn ceiling pre-1980s – used asbestos.
6. Any home before 1980 – asbestos, other toxic substances. Even though Asbestos was banned in 1977 existing inventory was still used everywhere.
7. Homes built before the mid 70s – as there is no guarantee lead pain is not somewhere in the house.
8. Random fresh paint – on an area of a wall or one wall.  What is it covering up?
9. Glad plugin or candles – this is a sure sign something might be stinky. It amazes me people will just buy plugins and think people do not have a brain.
10. EMF– If you want you could take an EMF or EMI reader though the house if you care about such things, I do.
11. Strange smells – in the house, mildew, cigarettes and animals.  Not toxic per say but we had to replace a floor because of a smell we could not identify. Even subtle smells will drive you crazy after a while.
12. Smells after rain – go to the house right after it rains and you can determine more issues, than on a sunny Sunday afternoon.

    

13. Solar panels – on the roof. DC to AC creates dirty energy and unless this is mitigated this could have a negative impact on your health. I will put solar in myself but I will do it right.

Negative energy

1. Home that has had a bad event – I know this is superstitious, call me crazy, but, I knew a friend that bought whose previous owner was a seasoned criminal. They bought it at a big discount, and were thrilled. Yet subsequent to the purchase only a series of tragic events befell them, one after another. If there was some crime, on the web will always have this street address associated with your home sweet home. You make your own decisions but this is mine, to do the research.

Fee problems – Fixed cost add to your life stress

1. Flood zone –  increases your insurance by a lot. Do not assume anything about flood zone, ask for the map and call your insurance agent.

   

2. High tax area – money out the door, even in the county the area have varied mill rates.
3. HOAs homeowners association – essentially a local tax for nothing. You could send your kids to the top private school or take vacations in Europe for the cost of HOA fees. HOAs are often involved in legal battles and nonsense. How do you feel about perpetual nonsense?  I know some places if you add all the fees up CCDs and HOAs and other they are 1k a month.  To me that is rent. Oh and if you do not pay the HOA can take your home faster than the bank. If you are getting foreclosed it might take years before eviction. You could live rent free, as long as you pay your HOA. If you do not pay that, that is trouble.
4. CCDs community development fees – a builder’s way of hiding the initial upfront cost of development. You will pay these like your mortgage for many years.

Price considerations

1. Buying too much house – My father told me this was the biggest mistake people make. It’s true. Why are there so many short sales and foreclosures? People buy large homes and pay too much and get into trouble. Read my lips, buy something that you can afford. The average home in the 1950s was 953 square feet. Today it is 2,678 square feet.  In the 50s people had larger families. And with a large house comes, taxes, utilities and cleaning. I lived in Europe and you do not need that much house to raise a family. My friends that are PhDs and MDs grew up with a family of four in a 500 square foot house or apartment. This was normal. However, if you can not make all the payments for a house and get evicted and raise a family in an apartment with various people around, that can affect your family. Better is get a lower cost house.  Unless you are a multimillionaire, the you can do what you want, and call me, I can help.

   

2. Too many people bidding and interested – unless you are a real shark with an inside track you are not going to get a deal.  In Saint Augustine the way it works is a Veteran knows a sheriff who knows a banker who knows a Realtor who lived here their whole life and they get the insiders deal. Everyone else is bidding in a competitive market and home value are subjective and the market is not perfect. So zig when others zag in the bidding and negotiation process.
3. Don’t buy as an investment – Real Estate after inflation does not give a good return historically. You can make money on the boom and bust cycle and flip homes after revovation for a windfall, but appreciation is more speculative. Do not believe me?  Look at the Case Shiller index in the USA over many years.

Home problems

1. Rooms with no or little windows – you can add sunroofs.
2. Not enough natural light – unless you live in Florida this can be an issue and will affect your happiness.

   

3. Additions to the house – that do not flow with the rest.
4. Uneven floors – or floor moving when you walk.
5. Insects – Termites are a deal breaker as they damage the wood. You can buy basic test Ants – you can use borax, cockroaches you can use essential oils and sticky strips.
6. Age of roof – metal roofs will last a hundred years but shingles have to be replaced and this costs. Consider the age of the roof.
7. Age of heating and air –  (HVAC).
8. A/C unit too close to the bedroom – Can be moved but it costs.
9. Low water pressure – not a deal breaker but an annoyance. I want a shower not a drizzle.
10. Cracks in the structure – as a corollary to this is sinkholes and erosion and other things that cause shifting. Determine what the house is build on.
11. Flickering lights – or tell-tale signs of old wiring, or burn marks near the outlet. Look at the outlet are the two or three prong.
12. Small backyard – don’t you want freedom? a garden? You do not have to have a few acres which you will cut all the time, but you want some yard for outdoor fun like croquet in the summer, or lawn chess.

    

13. Strange shape of the house – Each person has their own preference. For me the ideal is the kids bedroom near the parents.
14. Space that can not be used – we have a perfect house except for one dining room that does not fit well. When we have money we might expand the kitchen.
15. High utility bills – Rates vary from either high rate in area, rates vary even across small locations. We were paying a fortune in a small apartment, yet in our house we pay less and use more. Fixed cost add to your life stress.
16. Visible ducks – Ventilation pipes for A/c heating outside the interior walls.
17. Bathroom too close to living areas – Yeah I like a family bathroom next to living quarters, especially when you have guests over, for example, in the kitchen or living room. You will be play chess quietly and painfully wait for an unusual sound to echo through the house then your memory every time you see that person.

Less important issues that can be fixed with green stuff

1. Paint – buy non VOC paint, we used clay, has a cool texture and natural look.
2. Bathroom – needs remodelling in most cases.
3. Kitchen – Always can be improved, do you not want HDTV?
4. Landscaping – often people have no conception.  Put red roses and this alone will increase the value of your home.

   

5. Carpets often need replacing – Unless you do a deep chemical clean (I am not an advocate of chemicals), rugs are often have inhabitants, which are unseen to the human eye.
6. Mismatched floors – this could be fixed.
7. Anything not beautiful – think light, natural and healthy, I recommend Green Building supply if you are a do it yourself-er.

How people “play dumb” in three example

Realtors and sellers often simply ‘play dumb’ or stay silent, as they do not want to blow the deal.  They wait for you to figure out what is wrong with the house. They recommend you get an inspector.  The inspector gives an inspection of the obvious things (roof and HVAC age), but it is the non-obvious things that will zig you. Read my lips and my list, and use your own powers of deduction.

Example one – A person I know bought a house and it was filled with toxic Chinese drywall. Over fifty thousand dollars  latter, he tried to go after the seller and builder and others. However, the rule only applies if they ‘knew’ it had that.  They played dumb. An inspector will not tell you about Chinese drywall as this as it is not in his scope.  However there are tell tale signs I mention below.

Example two – Our friends bought with some shady neighbours next door. Realtors will basically say call your local police for crime statistics and research demographics on the US census beau website.   They do not want to violate the fair housing act by steering people. They basically can just ‘show the house’, everything else is up to you to figure out.

Example three –  I have scores of friends that did not understand the cumulative costs of CDDS, HOAs, insurance and taxes other in the home price, cash flow calculation. They have lost their homes because they did not understand this.

Did I depress you? I did not mean to, I just want your home experiences to be positive and wanted to give you my list of red flag homes I look for when I X-ray a home I am showing.

If you are looking for a home anywhere in the USA, contact me or leave a comment below and I can answer your questions.

The List: Low quality house “Do” buy check list

I had one month to find a home. I was relocating to another city because of my job.  I do consulting for banks and insurance companies. In a matter of four weeks I looked at over fifty homes. I closed and moved in.  It was one for the record books.

The question is, how did I find a home fast?

My ranking was in this order:

1. Lifestyle –   Lifestyle is the most important as life consists of everyday events. Close to my daughters school.   Access to I-95, so I could commute to work,  I did not want to spend twenty minutes just leaving a housing community.  Also proximity to the beach and hiking trails.  Shopping, I did not care about as we shop Amazon or Whole Foods once a week.
2. Peaceful – You need to be near nature. No noise, no traffic, space in the back for a garden.
3. Price – In a range but I was not looking for the all time bargain. If I wanted a bargain, that would be for investment property rather than a place to raise my family.
4. Beauty – Every house is a fixer upper. Every house can be improved and beautified with imagination.  So this was the least of my concerns.

Lifestyle Location – Nature is better than any shopping mall

1. Near beach – If you are on in a coastal area you want to be twenty minutes max. You do not want to be on the beach as you will pay to much. Forest – The forest produces oxygen and the smell of pine is uplifting.

   

2. Hiking trails – Like Henry David Thoreau – if your update, consider Lyme disease.  We make our own  natural tick repellent.
3. Parks – If you have children or pets these are essential.
4. Private school – Find a lower tax, no HOA and invest the difference in a private school. We send our daughter to an Classical private school and it is $500 dollars a month. This is the price of many HOAs and CDDs.
5. Good public schools – They should be ranked at least a 8. Even if you do not have school age children they are a good general quality indicator.
6. Near Starbucks – this company researches desirable areas and home values tend to be better here.
7. Near fun stores – Ikea, Whole foods.
8. Nice view – Nature rather than people.
9. Short commute – Every minute in your life count.
10. Safe – I would rather have an apartment in a safe neighbourhood than a house in a shady neighbourhood.
11. Walkable – Some exercises opportunity, park or swimming pool (preferably not chlorine).
12. Historical basis – Better than some developer developed the city, you want cultural.  In Florida there are entire cities just constructed.

    

13. Good health care facilities – nearby and easy to drive to and low wait time.
14. Getting to your house – To get to the community you have to get off the main road but not too far from the main road.  Just enough so there is no traffic.
15. You do not want to be in the centre – If your are in a community you want to be at the end where you have privacy or at the start where you have easy access to the main road. The centre just means all community traffic will pass by you.

Price

1. Resale value – in one year can you get the resale value?
2. Price is subjective – Value is always subjective, research the diamond water paradox. Water is essential but cheap, diamonds have little practical value but expensive. You can find deals based on trends in neighbourhoods.  That is transitional areas  or taken over by hipsters. Tech savvy hipster approve will find you homes. You will find a better value here than going to a place people already deem as real estate desirable.
3. Fewer people are bidding on – Often when it just hits the market you have a lot of interest. Better is to look for homes on the market for a while.
4. 200 day moving average of price – The trend is your friend –  User tools like Realtor.com to help map out price trends on a moving average basis. Consider supply and demand factors when looking at price. Are you buying a home that others producing, in the county en masse?
5. House was maintained and essentially move in ready – Fixer uppers are not the best deal. Better is to get a home that needs a little work and take it to the next level.  Either way you will add value, but one you can live in while you work.  A true fixer upper, is fun to work on, but you have to have time and resources, as many have environmental issues like mold or asbestos which are a pain to remediate. Better is a house that just needs things like paint and appliances. You can still get value but less effort. If you are going to sink tens of thousands in a fixer upper, instead you could build a brand new HDTV looking cordwood house for that price. Condition of the house is important you do not want to perpetually renovating.

   

This is the complete list for a first time home buyer, a new home buyer, or an experienced person in Real Estate. Anything you need to know is here. If you feel there are other ideas leave a comments. Please like this list to help increase awareness.  Contact me if you are looking for a home. mark@lafloridahomes.com