We bought a house! Ha, yeah right, but as I see those interest rates continue to creep lower, the PF nerd in me says “Now, Ninja. Now!” Two years ago people were saying the market had bottomed, but here we are with sub 4% interest rates. Who woulda thunk it?
While I’ve shared many times before the reason renting is clearly the better choice for us, even in this buyers market, that doesn’t mean I haven’t flirted with the idea of becoming a homeowner. I play with mortgage calculators all the time. Crunching numbers at various mortgage amounts, down payments, and interest rates; doing my best to figure out what combination of the three makes the most sense for us.
I search Redfin and Zillow almost every day looking at what’s out there, seeing if anything tickles my fancy. Usually nothing does, but occasionally a few gems pop up. I love not only viewing what’s currently for sale, but looking back at “recently sold” houses to get a true understanding of a homes value. I’m doing everything I can to educate myself on local market conditions, and crunching all numbers possible so when the right house pops up, Girl Ninja and I can gobble it up quickly.
That said, there is one thing market research and number crunching will never be able to tell me; Who lives behind the doors in the surrounding houses.
The idea of committing to residing in a single location for more than 12 months is already scary enough to me, let alone thinking about living adjacent to people I might want to punch in the face.
Let’s examine a real world example, shall we?
My parents, and Girl Ninja’s parents both bought their houses around the early 1990’s. Both homes were new construction, in nice/new neighborhoods at the time. Fast forward 20 years later, my parents neighborhood has unfortunately gone to hell in a hand basket, while Girl Ninja’s parents neighborhood is as beautiful as the day they moved in. Over half the houses in my parents cul-de-sac are in foreclosure. Many of the neighbors are the epitome of white trash, frequently hosting bonfires in the middle of the street until 3am. Few neighbors actually care about the appearance of their lawns and homes. It’s sad.
This is no fault to my parents. They had no control over who moved in over the years (my parents are one of only two original owners). They can’t force their neighbors to mow their lawns, to not park 87 cars in their driveway/yard/street, to paint their house every 10 years, or to pay their mortgages and not get foreclosed on.
This my friends scares me. Even if we do find the right house, owning comes with the inherit risk that your neighbors could still be douche bags. When you rent, if your neighbors suck you simply move. Owning doesn’t afford one that same luxury. Heck, even if we get a great feel from the neighbors, there’s nothing stopping them from selling their house to a registered sex offender 2 years later.
Ugh.
deep down inside I want to buy a house. I know it’s a great time. I know there are tax benefits and it’s ultimately an investment, but until I can get past these psychological barriers, renters we shall remain.
Those of you that own, I’d love to hear your opinion on your neighbors (love em, hate em, or don’t know em)!? Anyone else seen a neighborhood with a lot of potential like my parents, take a turn for the worse? How does one adequately take in to account in the “neighbor factor” when purchasing a home?
p.s. I should be clear that my parents neighborhood is by no means a total dump and they have a ton of equity in their house, but even they would agree it’s not the neighborhood it was when they first moved in.
I could write way too much here. A “good” homeowners association can make a difference keeping the neighborhood up. There are a great deal of factors that would make a HOA “good,” be sure to do heavy research. A neighborhood with expensive homes makes a difference too. I hate to sound elitist but rich people tend to make better neighbors than poor people. And that is my dilemma. We want an expensive home to insure we don’t have investors dumping a section 8 renter next door. Remember, location, location, location because from there you can discover a great deal about how good a neighborhood is.
Oh, ask GN’s parents why their neighborhood stayed nice. Luck? Good location? Strict HOA? I’m curious to know because I wonder if I’m missing some big points.
We don’t know our neighbours too well, but they are friendly enough. I think your example of your parents neighbourhood is more of an exception than the norm.
We looks up our neighborhood in the sex offenders list and it came out clean, of course there are those who don’t show up though because they haven’t been caught. But I think we’re good. We almost bought a house where our neighbor was a rapist though. OF course we didn’t buy that one! I was terrified.
We moved into our neighborhood 6 years ago as of yesterday. We bought at the height of the housing market and our house is now worth about 70% what we paid for it. We were one of the first 10 people to buy a house in our neighborhood. 9 out of the last 12 houses sold in our neighborhood were foreclosures. Our builder went bankrupt several years ago and our neighborhood has been half way finished for about 3 years now with no one building in the vacant lots. Overall this really sucks, but luckily my husband and I don’t need to move.
We live in the very back of our neighborhood and almost everyone on my street is our original neighbor. In fact, everyone for about three houses on both sides and across the street are our original neighbors. We all get along fairly well and people do a good job of taking care of their yards. We have a Nazi HOA, which is good in some ways because people will get fined for not mowing, etc.
My husband and I have said we never want to buy in a brand new neighborhood again unless we are close to the last house. You never know what is going to happen. The only problem with that logic is that older neighborhoods can change too, just look at Detroit.
For the most part towns with good school systems stay good for a long time, but with good school systems you get higher than average taxes. As for sex offenders you can do a search but there is no guarantee they won’t move in later. You might not to hear this but if you buy a home and you notice things going downhill your only protection is to sell fast or use it as a rental and move on.
You don’t really believe that a home is an investment do you? Its an investment in the sense that you take out your net worth and apply it towards an asset, but I don’t think anyone can reasonable expect a home value to grow at a typical rate every year, etc.
We moved into a very established neighborhood, with excellent schools, and a great voluntary association (most people are involved in it though). Our area is also one of the most highly sought after neighborhood in our city. Our realtor also knocked on the doors of our neighbors and met both of them and then reported back to us–I love that she did that for us! I know they could move, but our city is growing at an alarming pace and property values are going up so we’re hoping “riff raff” can’t afford our neighborhood.
I have been feeling less and less drawn to purchase a home. The huge financial burden of home ownership, maintenance, and all consuming time is not attractive. The idea that the house you buy, you need to stay in for 30 years is a scary committment as you mention, life changes. In the long haul, owning a home is a smart investment, but until the kids on our on their way, I am staying put.
We purchased the house my grandfather built. When it was built in the 1950s it was a typical suburban neighborhood. Today is pretty much the same. It isn’t as desirable as some of the other areas of town, but location-wise it is 15 minutes from many of the major “cultural” hubs in the city. The only real change is, the neighborhood is a little more working class or right in the middle of the middle class. Which is fine. There are plenty of young families that are moving in along with people who have lived there for years.
You can’t tell what will happen to a neighborhood in the future, but I do know all the houses in my neighborhood are solid construction and most everyone has pride in their homes.
Research your state’s “child safety zones”. It will define the minimum number of feet that a sex offender convict or parolee can live near “places where children congregate”, which is usually defined as schools and parks and sometimes other facilities. The closer you live to these defined places, the further away the convicted sex offenders should be.
Some cities have been accused of ‘stacking’ these facilities so that sex offenders are essentially blocked out of huge areas. … They put a 75,000 square foot school on a million square foot lot, then build a city park or other defined facility centered every 4000 feet until they reach the boundary of the next school. I’ve seen maps of Dallas Texas suburbs with child safety zone circles that overlap each other for miles. If you can find one of these areas, you may not have any sex offenders living nearby (except the ones that already lived there prior to conviction (they usually don’t force them to move) and the ones that haven’t been caught yet).
If you’re looking for safety zone stacking, you’re more likely to find it in a Red state with right wing city planners. .. ie, many growing North Texas suburbs, but maybe not so much in Seattle.
Jeez, knowing all that looks like I must be a sex offender! Actually I happen to live in one of these ‘stacked’ areas. I’m not sure it makes it any safer, but it certainly looks interesting on a map.
LOVE my neighborhood. We got lucky because we bought our house FSBO, and they had lived in the neighborhood for 40 years (still do – they are our across the street neighbors!) so they could tell us a lot about the neighborhood. Many of our other neighbors have lived there for 20-40 years as well, including one man who grew up in the home he is raising his family in now. All in all, I’m confident it will stay that way 🙂 we are in a great school district, short walking distric through neighborhoods to the elementary school, and 1/4 mile for a small shopping center. Just outside of Seattle too, so they do exist! I would suggest going outside of the Seattle city limits though if those are your kinds of worries, as the Seattle neighborhoods seem to change more significantly over time.
I worried about the neighbor factor when I moved into my new place. But I drove by a couple times throughout the week to get a sense of the place. I definitely lucked out, minus one neighbor (renters) who have an out of control blackberry bush I’m really lucky. Worse case scenario I can always rent this house out (right by a local college) and find a new place to live.
My mom’s in a predicament like your parents. She bought a condo on the edge of our small-town with fields in front and back of it. It was near some low-rent apartments but nicer apartments were on the other side. In the past ten years, all of the fields have been turned into ugly apartments and the number of juvenile delinquents roaming the neighborhood has soared. She’s been robbed several times, including twice inside the home. I worry about her all the time, especially since the rest of our family has moved to other towns in the area.
I have lived as a shareholder for 22+ years in an apartment complex that is part co-operative, part rental. The original intent was to sell the entire complex (200+ units) so that it would be an entirely self-governing co-operative, but that never panned out nor is likely to. As a shareholder, I have an 800 sq ft upstairs unit with my own mortgage (nearly paid off) and get the same tax breaks as a homeowner would, but as for neighbors, they have their highs and lows. Nearly all the shareholders are excellent neighbors because they have an investment in the place and take good care of it. The renters are variable, and one couple living beneath me for 5 years were extremely unpleasant people; I finally had to turn to the apartment management to resolve the problems they were causing me. But because the complex is fairly well managed and has some strict rules, the immediate neighbors have never become a major concern.
The immediate area outside the complex is a somewhat different story. It’s all standard detached houses and I live within a 20-minute walk from a large shopping mall (the usual Macy’s, Sears, and so forth). Many of the houses in the area look well-maintained, but until a year or so ago there was one run-down looking house with a large badly kept yard. I used to pass this house on my evening walks to the mall, and the 20-year-old who lived there was always very polite and friendly. Too polite and friendly, I thought. He had no obvious means of support, the house actually belonged to his mother who lived elsewhere with her boyfriend, and there were often lots of kids congregating around the property. Sometime in 2007, there was a news story that this polite and friendly kid had shot and killed an intruder, and that he was a small-time drug dealer himself. I didn’t see “Billy” for a few years after that, and last year, his house was apparently condemned and razed; it’s now an empty lot. ‘Bye, “Billy,”
The issue is not the enticing interest rates, but the price of the homes. The interest rates only make it more affordable. Watch the home prices and find your own deal. If the house you want comes along at a rock bottom cost, jump on it.
I feel the current home prices are “higher” than normal with low interest rates. If interest rates were higher I think home prices would have to drop. 🙂
Let me tell you a story about neighbors.
At my parent’s house where I grew up, one of our neighbors (married, 2 kids) started sleeping with the lady across the street (married to retired firefighter, 3 kids). Long story short, it ended with the retired firefighter shooting the other guy in the junk in front of the police (who had been called because the cheaters were caught and a fight broke out between the firefighter and the other guy).
That’s right. He got a bullet in his junk for cheating.
Those were my parent’s neighbors.
Oh thanks for reminding me! I just looked up all the registered sex offenders near us and….there are NONE!! (Well there are some like within a 5 mile radius but none in the nearby neighborhoods). Phew!
You buy into a neighborhood with deed restrictions and/or required homeowners association restrictions. The HOA will make sure the “trash” cleans up their act, or they will be fined and eventually sued.
Seems to me that this will be somewhat a function of the neighborhood you live in and the type of property you buy. You might buy a piece of new construction, but if it’s in an established neighborhood, the neighbors may be less likely to turn over quickly. However, if you’re buying in a new development or where zoning will make it likely that new development could occur around you, what that area will look like in ten years is much less certain. Of course, the opposite of your parents’ experience can occur too – gentrification. Seemed to me that lots of McMansions popped up around my parents’ suburban home in the late 90s-early 2000s, but the zoning was such that we didn’t know many of the neighbors.
Don’t look for the right home, look for the right neighborhood. And who says you have to stay in the same home forever? We have bought 4 houses in our 12 years of marriage. We moved out of our first home because we didn’t like the area. We moved to what we thought was a scary area to save money and be closer to work and school. It turned out that we absolutely loved that area and all our neighbors. But we moved to the area we wanted to be in “forever”. It is the richest town in our state I just learned. We bought the only house in the town that was under 300,000. There is rarely homes that go up for sale because no one wants to leave. We could have purchased much nicer homes just 5 minutes away in neighboring towns, but I insisted on living in this town. After living in that home for two years we had an opportunity to buy a home just up the street that had been vacant for over two years due to foreclosure and Bank of America’s incompetence to sell foreclosures. We ended up getting the house at a great discount.
Also, forget HOAs. I would never buy a home in an HOA. Who wants a bunch of snooty self-righteous volunteers to take away your property rights to enforce their opinion on what you should do with you home and property?
Houses are a poor investment unless you plan on renting them out. First you have to buy them, then maintain them. However, if you are looking for the comfort of home without the ability for someone to kick you out it is of great value. In your situation I would look into purchasing a condo that is highly rentable. This way if you find that you dont want to be tied down you can rent it out and generate some passive income.
That’s definitely a scary proposition, but there’s nothing saying you can’t check out the neighborhood first. There are websites that allow you to see if there are pedophiles in the neighborhood, even if it’s not perfect. Also, you can usually find out a few things about people in the neighborhood if you decide to talk to a few potential neighbors to find out what’s going on. Of course, if you have more money to spend you can afford a pretty nice neighborhood where those issues are minimized.
My current residence is sort of an agricultural community. All of the homes are on at least an acre and I’ve got a corn field on one side and an apple orchard on the other. I do have a couple of neighbors across the street. We wave at each other but don’t really “interact”. About once a year one of the neighbors has a party that knocks some fillings loose, but the rest of the year they’re quiet and tidy. It’s a hard neighborhood to get into. Usually the homes are snatched up by relatives of current owners before they ever hit the market. Unless we build in the future, we’ll probably be here awhile.
I’ve had some weird neighbors in the past but I find that nicknaming them funny names for private use helps ease the tension.
Gosh you think too much.
We rented for a bit between living in our co-op and buying our house. We hated it. It’s hard to find a 3-bedroom where the owners want kids there. Where we did find a rental, the neighborhood had terrible parking and we had to deal with neighbors below us and next to us on each side. We got all sorts of noise and smells. People were way too close. It was ok in the long run since we rented knowing we were going to buy a house. We have a beautiful home in a great neighborhood now and we’re real happy with it. We’ve also come upon all sorts of little expenses that add up ( I swear buying a home is like getting a line of credit to Home Depot).
when we bought our house, our LHS neghbours seemed awesome, destine to be our new best friends, our RHS neighbours seemed hellish, destined to be the reason we never got a full nights sleep on the weekend. Fast forward 3 years, the “good neighbours have installed 4 roosters and a horse in their suburban backyard and no longer speak to us, the RHS neighbours are pretty normal, and have only woken us up once, on a major birthday party. You can’t choose your neighbours, but you can buy a big-ass fence.