What's new
Fantasy Football - Footballguys Forums

Welcome to Our Forums. Once you've registered and logged in, you're primed to talk football, among other topics, with the sharpest and most experienced fantasy players on the internet.

Personal Finance Advice and Education! (7 Viewers)

Sand said:
Mystery Achiever said:
RUSF18 said:
Appreciate it. A bit confused on something, but maybe I'm just not thinking about this correctly...

You can get turnover rates for ETFs just like funds. This one, MOO, is probably on the higher side, but shows 33%, so check all individually.

http://finance.yahoo.com/q/pr?s=moo&ql=1

I'm on Vanguard's site. The 1-year and 3-year returns before taxes for VOO (S&P 500 ETF) are 13.64% and 20.37%, respectively. Those same returns "after taxes on distributions" are 13.12% and 19.87%.

The Vanguard Admiral Shares index fund (VFIAX) has 1-year and 3-year pre-tax returns of 13.64% and 20.37%, respectively. After taxes on distributions...13.12% and 19.86%.

So off by a 1 bp on the 3 year, but otherwise the same. Is this just unique to the type of ETF/index fund or am I having a "Josh Baskin during the robot building" moment?
Click to expand...
I was just thinking of tax liability generated by portfolio turnover. If there are other differences, hopefully Sand or someone else can comment. VOO and VFIAX are based off the same index, so turnover would be the same.
Click to expand...
The way I understand things with ETFs they are allowed to perform stock swaps which don't trigger a sale, so no capital gains. Mutual funds do buy and sell, so there are capital gains distributions which will hit in a taxable account (in an IRA it doesn't matter). So ETFs tend to be a bit more tax efficient. Note that some funds are low turnover and some are shockingly high.

If I bought a Vanguard fund and the corresponding ETF in a sheltered account I'd expect they would be damn near identical in performance. It really just comes down to tax efficiency - that's all I was getting at.
Click to expand...
Appreciate the info as that particular tax impact wasn't something I was considering. Doesn't seem to matter with the funds I am thinking of, but it could in the future. :hifive:

ghostguy123 said:
RUSF18 said:
So "better" depends on what you're looking for...some global diversification that also comes with a bit of hedging through the bonds included or a much lower fee paid while still having the growth potential of US stocks.

I'd go for the Vanguard. While the Fidelity fund isn't what would be considered expensive, that's a LOT of money you're saving over the years.
Click to expand...
Was sort of contemplating putting half in one and half in the other. And just let em go and go and go
Click to expand...
Well...why? Just because it's easier to do that because you can't decide on either?

That seems sort of pointless. Not pushing one over the other but dividing your money makes sense when you're trying to diversify and you're not really getting that whether you're buying into one or both of those options. Seriously, run the numbers on what an extra 0.73% fee will cost you on your investment over 25 years and see if that makes sense. The Vanguard fund is a good option. If you don't want to go with that, I'd see if you have access to the Fidelity target fund someone else mentioned that had a comparable fee structure.

 
GM, you are almost blind in your support of home purchasing. Advising someone to buy with 3.5%? Why not 0%, bring it back to 2006?

Big picture stuff that many gloss over:

1. You will lose 6-10% between buying/selling. If you are counting on your home to appreciate, it needs to beat this. That is why people say you need to stay in your home 5-10 years to make the numbers work.

2. People overemphasize "building equity" and don't speak to the reality that for the first 10 years you are basically renting from the bank (paying mostly interest). Again, this applies more to short term owners <10 years.

3. People assume house prices will go up, when historically they have only kept pace with inflation (Google if needed). Home appreciation is a recent phenomenon and is not assured to continue.

4. Most get as much home they can afford, and only rent what they need. This part is big and often overlooked.

GM, you ask if I was burned, nope. Bought my first home 6 months ago and love it. I am a realist though...

 
Random said:
fatguyinalittlecoat said:
Random said:
fatguyinalittlecoat said:
Random said:
Ok, true if you move every five years you will get eaten alive by realtors. But could all of that added up to the amount you are guaranteed to "lose" in rent?
Click to expand...
Aren't you the guy who lives in a town where you can buy nice houses for $50,000?
Click to expand...
Yes, but I never paid that much for a rental.
Click to expand...
Yeah, I just don't know if we can really see eye to eye here. The numbers are just too different. I'm guessing if I lived where you do we would have bought.
Click to expand...
True. But the principals still remain the same. Its generally better to rent if the purchase price is more than 100x rent. So if you are renting a $200K house for more than $2K/mo, you would be better off buying. Again, this is just a very broad guideline. I know for my local, I would never rent houses for 1% of the purchase price. We get closer to 5%.
Click to expand...
?

Show me houses that rent for $2k/mo and sell for $200K and I'd buy several.

Not realistic.

 
chet said:
Random said:
fatguyinalittlecoat said:
Random said:
fatguyinalittlecoat said:
Random said:
Ok, true if you move every five years you will get eaten alive by realtors. But could all of that added up to the amount you are guaranteed to "lose" in rent?
Click to expand...
Aren't you the guy who lives in a town where you can buy nice houses for $50,000?
Click to expand...
Yes, but I never paid that much for a rental.
Click to expand...
Yeah, I just don't know if we can really see eye to eye here. The numbers are just too different. I'm guessing if I lived where you do we would have bought.
Click to expand...
True. But the principals still remain the same. Its generally better to rent if the purchase price is more than 100x rent. So if you are renting a $200K house for more than $2K/mo, you would be better off buying. Again, this is just a very broad guideline. I know for my local, I would never rent houses for 1% of the purchase price. We get closer to 5%.
Click to expand...
?

Show me houses that rent for $2k/mo and sell for $200K and I'd buy several.

Not realistic.
Click to expand...
How many would you like? I have plenty of houses that rent for $700-$800 I'd sell you for 70-80K each. I'll even manage them for you for a fee.

 
Random said:
chet said:
Random said:
fatguyinalittlecoat said:
Random said:
fatguyinalittlecoat said:
Random said:
Ok, true if you move every five years you will get eaten alive by realtors. But could all of that added up to the amount you are guaranteed to "lose" in rent?
Click to expand...
Aren't you the guy who lives in a town where you can buy nice houses for $50,000?
Click to expand...
Yes, but I never paid that much for a rental.
Click to expand...
Yeah, I just don't know if we can really see eye to eye here. The numbers are just too different. I'm guessing if I lived where you do we would have bought.
Click to expand...
True. But the principals still remain the same. Its generally better to rent if the purchase price is more than 100x rent. So if you are renting a $200K house for more than $2K/mo, you would be better off buying. Again, this is just a very broad guideline. I know for my local, I would never rent houses for 1% of the purchase price. We get closer to 5%.
Click to expand...
?

Show me houses that rent for $2k/mo and sell for $200K and I'd buy several.

Not realistic.
Click to expand...
How many would you like? I have plenty of houses that rent for $700-$800 I'd sell you for 70-80K each. I'll even manage them for you for a fee.
Click to expand...
There must be something else going on. Can you forward a link or two?

 
http://www.realtor.com/realestateandhomes-search/45365/type-single-family-home,multi-family-home/price-na-75000/sby-1?pgsz=3

Nothing there that interests me at the moment, but with a little TLC either of those first two would pull in $500+/half. The $20K sfh on Piper would rent for $700+ (I have 5 in that neighborhood). Now imagine its 2007-2013. We had our pick of houses for $15K that required very little work (carpet and paint for some, plumbing carpet and paint for others). These houses are all rented for $700-$800.

 
Last edited by a moderator:
Random said:
chet said:
Random said:
fatguyinalittlecoat said:
Random said:
fatguyinalittlecoat said:
Random said:
Ok, true if you move every five years you will get eaten alive by realtors. But could all of that added up to the amount you are guaranteed to "lose" in rent?
Click to expand...
Aren't you the guy who lives in a town where you can buy nice houses for $50,000?
Click to expand...
Yes, but I never paid that much for a rental.
Click to expand...
Yeah, I just don't know if we can really see eye to eye here. The numbers are just too different. I'm guessing if I lived where you do we would have bought.
Click to expand...
True. But the principals still remain the same. Its generally better to rent if the purchase price is more than 100x rent. So if you are renting a $200K house for more than $2K/mo, you would be better off buying. Again, this is just a very broad guideline. I know for my local, I would never rent houses for 1% of the purchase price. We get closer to 5%.
Click to expand...
?

Show me houses that rent for $2k/mo and sell for $200K and I'd buy several.

Not realistic.
Click to expand...
How many would you like? I have plenty of houses that rent for $700-$800 I'd sell you for 70-80K each. I'll even manage them for you for a fee.
Click to expand...
I have one rental...we bought for $126,000 (2013) and rent it for $1,375 :shrug: not sure why it's so hard to believe.
 
Last edited by a moderator:
xulf said:
Random said:
chet said:
Random said:
fatguyinalittlecoat said:
Random said:
fatguyinalittlecoat said:
Random said:
Ok, true if you move every five years you will get eaten alive by realtors. But could all of that added up to the amount you are guaranteed to "lose" in rent?
Click to expand...
Aren't you the guy who lives in a town where you can buy nice houses for $50,000?
Click to expand...
Yes, but I never paid that much for a rental.
Click to expand...
Yeah, I just don't know if we can really see eye to eye here. The numbers are just too different. I'm guessing if I lived where you do we would have bought.
Click to expand...
True. But the principals still remain the same. Its generally better to rent if the purchase price is more than 100x rent. So if you are renting a $200K house for more than $2K/mo, you would be better off buying. Again, this is just a very broad guideline. I know for my local, I would never rent houses for 1% of the purchase price. We get closer to 5%.
Click to expand...
?

Show me houses that rent for $2k/mo and sell for $200K and I'd buy several.

Not realistic.
Click to expand...
How many would you like? I have plenty of houses that rent for $700-$800 I'd sell you for 70-80K each. I'll even manage them for you for a fee.
Click to expand...
I have one rental...we bought for $126,000 (2013) and rent it for $1,375 :shrug: not sure why it's so hard to believe.
Click to expand...
:D We're both in Ohio. Lol.

 
RUSF18 said:
Well...why? Just because it's easier to do that because you can't decide on either?

That seems sort of pointless. Not pushing one over the other but dividing your money makes sense when you're trying to diversify and you're not really getting that whether you're buying into one or both of those options. Seriously, run the numbers on what an extra 0.73% fee will cost you on your investment over 25 years and see if that makes sense. The Vanguard fund is a good option. If you don't want to go with that, I'd see if you have access to the Fidelity target fund someone else mentioned that had a comparable fee structure.
Click to expand...
In mine, the Vanguard definitely has lower fees. If they are a very similar performer, then obviously the lesser fees would be the best option.

That's why I asked which one is better. If they are even close, then the Vanguard would be the way to go

 
chet said:
There must be something else going on. Can you forward a link or two?
Click to expand...
I know where I live I can buy plenty of houses under $100,000 (including costs to have move-in ready) and rent for $1,000 or more.

Hell the house I am in the process of buying for my family right now I am getting for $115,000 and it would easily rent for $1,200 or more.

 
Actually the rental condo I bought was $40,000 (plus about 4-5 grand to get move-in ready) and it rents comfortably for $750.

Maybe some of you guys who dont believe you can get 10% (more really) ROI should come out this way :thumbup:

 
FUBAR said:
dang, some of your guys' rent is huge. We live in a market saturated with homes for sale yet pay around 0.5% ($1500 on a $300k home). Of course, that could be why nothing sells here.
Click to expand...
Yeah I would pretty gladly pay $1,500 in rent instead of paying $300,000 for the same house. Unless I was paying cash for the house I guess.

Between the taxes, interest, and maintenance it just wouldnt make sense to buy

 
Jebus. Renting a studio (~500 sq feet) in the Bay Area is around 1400. You guys are getting entire homes? Waaaaaah.

 
General Malaise said:
humpback said:
mquinnjr said:
humpback said:
mquinnjr said:
I think that's a big driver, whilst agreeing with all of your other points.
It's a savings/retirement account balance in the form of a building which you own, that people can see and where you live vs. an account balance in a retirement account or other savings account that you can only see online. It's not "sexy," or something people can show off to their friends or host parties in.

If it's the visual that gets people, I would bet less people would go buy vs. rent if you put next to the home they're thinking about buying a pallet stacked with all of their current savings in $20's. Add a compounded 7-8% of that cash onto the pallet - next to the house - 30 times. Now sure, homes can appreciate too. If you said, "Which would you choose if you could only have one?" I'd be interested to see that.
Click to expand...
This seems like a bad analogy to me. Where are you getting this pallet of money from?
Click to expand...
20% downpayment (to avoid PMI). I'm more looking at this glass half empty, or people that might be getting in over their heads just to have a home, to have a home. Not JB's situation, which is not like that it seems. Moreso following up on wilked's reply that it's not 0% downside risk in buying a house.
Click to expand...
Of course there isn't 0% downside risk in buying a house, and people shouldn't get in over their heads just to have a home, but I'm still not following the analogy. It generally isn't any cheaper to rent vs. buy an equivalent property, even factoring in the down payment, so the buy vs. rent and have a pallet of cash doesn't really make sense.
Click to expand...
I bought a house in 2001 for $185,000. I've paid the note down significantly and refinanced to take advantage of low rates. My mortgage with taxes and insurance is $1,110 per month. Today, I could rent my house for $2100 in a desired neighborhood. Even if I employ a management company at 10%, I'm coming out way ahead. I can also list my house today for $325,000. Wife and I are debating on whether or not we want to sell and capture the equity or have another person pay off our mortgage and have a house worth potentially $400-500K in 15-20 years (I live in an area of the country that is experiencing high population growth).
Click to expand...
So over 34 years the CAGR would be 3.05%. Not even taking into account time and expenses over that period. ??

 
While we're on homebuying talk, I have a really dumb question. As mentioned in a different thread, I'm in the market for a house. Great. Have some neighborhoods targeted, have a spending limit in mind.

So where the #### do I start?

Hire a realtor? Go to a bank and get pre-qualified before getting a realtor? Which bank, the place where I have my checking account? Some online bank? Aren't pre-qual letters kinda meaningless and non-binding? Do I just walk into the bank and go up to the teller like "uh I want to talk about getting a home mortgage"?

This feels really dumb, but I've tried researching this with no real solutions, and people I've asked have given me answers all over the map.

 
Last edited by a moderator:
Banks will help you figure out I'd you qualify for the amount you want. I'd guess you want much less than the amount you could qualify for. No advice on how to find a realtor, mine sucked. You can use realtor.com and just browse open houses if you're in the early stages though.

 
Sand said:
Mystery Achiever said:
RUSF18 said:
Appreciate it. A bit confused on something, but maybe I'm just not thinking about this correctly...

You can get turnover rates for ETFs just like funds. This one, MOO, is probably on the higher side, but shows 33%, so check all individually.

http://finance.yahoo.com/q/pr?s=moo&ql=1

I'm on Vanguard's site. The 1-year and 3-year returns before taxes for VOO (S&P 500 ETF) are 13.64% and 20.37%, respectively. Those same returns "after taxes on distributions" are 13.12% and 19.87%.

The Vanguard Admiral Shares index fund (VFIAX) has 1-year and 3-year pre-tax returns of 13.64% and 20.37%, respectively. After taxes on distributions...13.12% and 19.86%.

So off by a 1 bp on the 3 year, but otherwise the same. Is this just unique to the type of ETF/index fund or am I having a "Josh Baskin during the robot building" moment?
Click to expand...
I was just thinking of tax liability generated by portfolio turnover. If there are other differences, hopefully Sand or someone else can comment. VOO and VFIAX are based off the same index, so turnover would be the same.
Click to expand...
The way I understand things with ETFs they are allowed to perform stock swaps which don't trigger a sale, so no capital gains. Mutual funds do buy and sell, so there are capital gains distributions which will hit in a taxable account (in an IRA it doesn't matter). So ETFs tend to be a bit more tax efficient. Note that some funds are low turnover and some are shockingly high.

If I bought a Vanguard fund and the corresponding ETF in a sheltered account I'd expect they would be damn near identical in performance. It really just comes down to tax efficiency - that's all I was getting at.
Click to expand...
Thanks for the explanation. :thumbup:

 
Steve Tasker said:
While we're on homebuying talk, I have a really dumb question. As mentioned in a different thread, I'm in the market for a house. Great. Have some neighborhoods targeted, have a spending limit in mind.

So where the #### do I start?

Hire a realtor? Go to a bank and get pre-qualified before getting a realtor? Which bank, the place where I have my checking account? Some online bank? Aren't pre-qual letters kinda meaningless and non-binding? Do I just walk into the bank and go up to the teller like "uh I want to talk about getting a home mortgage"?

This feels really dumb, but I've tried researching this with no real solutions, and people I've asked have given me answers all over the map.
Click to expand...
1) You don't hire a realtor. The seller should pay the realtor expenses. If you want your own realtor they will split the commission with the listing agent.

2) Getting pre qualified is a great start. Shop banks, look for the lowest closing costs, land lowest rate.

3) I would find a few homes on realtor.com and call the listing agent. Some will recommend using your own agent, but if you find the house you want on your own using the listing agent has some perks (they will really want the sale and can use commission to bring down the price).

 
Bucky86 said:
Random said:
Here's one. $20K list (been listed for 6+months, we could probably get it for $15K). Probably needs $5-$10K tops in work to get it rented, we would rent it for $700-$725. I might go look at it today.

http://www.realtor.com/realestateandhomes-detail/133-Piper-St_Sidney_OH_45365_M44117-59278?row=3
Click to expand...
What's your monthly expense on one of these? Are these declining neighborhoods? Do you ever sell these properties or just rent them out?
Click to expand...
About $100/mo once its rehabbed. Neighborhoods are blue collar but not drug/crime infested. Most properties in our neighborhoods sell for $60-$80K (this one has a zestimate of $80K). We flipped the first two we bought (made a little on one and a lot on the next) but have kept everything since.

 
Random said:
Steve Tasker said:
While we're on homebuying talk, I have a really dumb question. As mentioned in a different thread, I'm in the market for a house. Great. Have some neighborhoods targeted, have a spending limit in mind.

So where the #### do I start?

Hire a realtor? Go to a bank and get pre-qualified before getting a realtor? Which bank, the place where I have my checking account? Some online bank? Aren't pre-qual letters kinda meaningless and non-binding? Do I just walk into the bank and go up to the teller like "uh I want to talk about getting a home mortgage"?

This feels really dumb, but I've tried researching this with no real solutions, and people I've asked have given me answers all over the map.
Click to expand...
1) You don't hire a realtor. The seller should pay the realtor expenses. If you want your own realtor they will split the commission with the listing agent.

2) Getting pre qualified is a great start. Shop banks, look for the lowest closing costs, land lowest rate.

3) I would find a few homes on realtor.com and call the listing agent. Some will recommend using your own agent, but if you find the house you want on your own using the listing agent has some perks (they will really want the sale and can use commission to bring down the price).
Click to expand...
Good info.

When you say "shop banks"....you mean just shop locally? Online?

Would there be a benefit to me hiring a real estate agent considering that I don't know the ins-and-outs of the homebuying process? I understand why someone like you who owns a bunch of properties wouldn't need one, but I don't want to just walk into something that I'm unprepared for and get swindled.

 
Steve Tasker said:
Random said:
Steve Tasker said:
While we're on homebuying talk, I have a really dumb question. As mentioned in a different thread, I'm in the market for a house. Great. Have some neighborhoods targeted, have a spending limit in mind.

So where the #### do I start?

Hire a realtor? Go to a bank and get pre-qualified before getting a realtor? Which bank, the place where I have my checking account? Some online bank? Aren't pre-qual letters kinda meaningless and non-binding? Do I just walk into the bank and go up to the teller like "uh I want to talk about getting a home mortgage"?

This feels really dumb, but I've tried researching this with no real solutions, and people I've asked have given me answers all over the map.
Click to expand...
1) You don't hire a realtor. The seller should pay the realtor expenses. If you want your own realtor they will split the commission with the listing agent.

2) Getting pre qualified is a great start. Shop banks, look for the lowest closing costs, land lowest rate.

3) I would find a few homes on realtor.com and call the listing agent. Some will recommend using your own agent, but if you find the house you want on your own using the listing agent has some perks (they will really want the sale and can use commission to bring down the price).
Click to expand...
Good info.

When you say "shop banks"....you mean just shop locally? Online?

Would there be a benefit to me hiring a real estate agent considering that I don't know the ins-and-outs of the homebuying process? I understand why someone like you who owns a bunch of properties wouldn't need one, but I don't want to just walk into something that I'm unprepared for and get swindled.
Click to expand...
would you be willing to read a book like homebuying for dummies

 
Steve Tasker said:
Random said:
Steve Tasker said:
While we're on homebuying talk, I have a really dumb question. As mentioned in a different thread, I'm in the market for a house. Great. Have some neighborhoods targeted, have a spending limit in mind.

So where the #### do I start?

Hire a realtor? Go to a bank and get pre-qualified before getting a realtor? Which bank, the place where I have my checking account? Some online bank? Aren't pre-qual letters kinda meaningless and non-binding? Do I just walk into the bank and go up to the teller like "uh I want to talk about getting a home mortgage"?

This feels really dumb, but I've tried researching this with no real solutions, and people I've asked have given me answers all over the map.
Click to expand...
1) You don't hire a realtor. The seller should pay the realtor expenses. If you want your own realtor they will split the commission with the listing agent.

2) Getting pre qualified is a great start. Shop banks, look for the lowest closing costs, land lowest rate.

3) I would find a few homes on realtor.com and call the listing agent. Some will recommend using your own agent, but if you find the house you want on your own using the listing agent has some perks (they will really want the sale and can use commission to bring down the price).
Click to expand...
Good info.

When you say "shop banks"....you mean just shop locally? Online?

Would there be a benefit to me hiring a real estate agent considering that I don't know the ins-and-outs of the homebuying process? I understand why someone like you who owns a bunch of properties wouldn't need one, but I don't want to just walk into something that I'm unprepared for and get swindled.
Click to expand...
I don't know. I'm a DIYer. I found our first house by myself and called a relative to do the paperwork. I don't see the downside to shopping online banks either.

 
Last edited by a moderator:
Steve Tasker said:
Steve Tasker, on 04 Mar 2015 - 09:19 AM, said:
Random said:
Random, on 04 Mar 2015 - 06:48 AM, said:
Steve Tasker said:
Steve Tasker, on 03 Mar 2015 - 11:26 PM, said:While we're on homebuying talk, I have a really dumb question. As mentioned in a different thread, I'm in the market for a house. Great. Have some neighborhoods targeted, have a spending limit in mind.

So where the #### do I start?

Hire a realtor? Go to a bank and get pre-qualified before getting a realtor? Which bank, the place where I have my checking account? Some online bank? Aren't pre-qual letters kinda meaningless and non-binding? Do I just walk into the bank and go up to the teller like "uh I want to talk about getting a home mortgage"?

This feels really dumb, but I've tried researching this with no real solutions, and people I've asked have given me answers all over the map.
Click to expand...
1) You don't hire a realtor. The seller should pay the realtor expenses. If you want your own realtor they will split the commission with the listing agent.

2) Getting pre qualified is a great start. Shop banks, look for the lowest closing costs, land lowest rate.

3) I would find a few homes on realtor.com and call the listing agent. Some will recommend using your own agent, but if you find the house you want on your own using the listing agent has some perks (they will really want the sale and can use commission to bring down the price).
Click to expand...
Good info.

When you say "shop banks"....you mean just shop locally? Online?

Would there be a benefit to me hiring a real estate agent considering that I don't know the ins-and-outs of the homebuying process? I understand why someone like you who owns a bunch of properties wouldn't need one, but I don't want to just walk into something that I'm unprepared for and get swindled.
Click to expand...
I don't know much about the online lenders but check with your larger banks, smaller local banks, and maybe some independent mortgage companies you have locally.

In your case definitely get a realtor, the seller will pay the full commission so its not out of your pocket. Ask around for recommendations instead of calling a random one.

 
Random, your advice might work in a very slow market but I wouldn't recommend it for most (my two cents)

 
Dentist said:
Steve Tasker said:
Random said:
Steve Tasker said:
While we're on homebuying talk, I have a really dumb question. As mentioned in a different thread, I'm in the market for a house. Great. Have some neighborhoods targeted, have a spending limit in mind.

So where the #### do I start?

Hire a realtor? Go to a bank and get pre-qualified before getting a realtor? Which bank, the place where I have my checking account? Some online bank? Aren't pre-qual letters kinda meaningless and non-binding? Do I just walk into the bank and go up to the teller like "uh I want to talk about getting a home mortgage"?

This feels really dumb, but I've tried researching this with no real solutions, and people I've asked have given me answers all over the map.
Click to expand...
1) You don't hire a realtor. The seller should pay the realtor expenses. If you want your own realtor they will split the commission with the listing agent.

2) Getting pre qualified is a great start. Shop banks, look for the lowest closing costs, land lowest rate.

3) I would find a few homes on realtor.com and call the listing agent. Some will recommend using your own agent, but if you find the house you want on your own using the listing agent has some perks (they will really want the sale and can use commission to bring down the price).
Click to expand...
Good info.

When you say "shop banks"....you mean just shop locally? Online?

Would there be a benefit to me hiring a real estate agent considering that I don't know the ins-and-outs of the homebuying process? I understand why someone like you who owns a bunch of properties wouldn't need one, but I don't want to just walk into something that I'm unprepared for and get swindled.
Click to expand...
would you be willing to read a book like homebuying for dummies
Click to expand...
I think that a realtor can be useful for a first-time homebuyer, or at a minimum, get a book like this. A lot of realtors are worthless, but I got a recommendation when I was a first-time buyer (at age 28), and she was a pretty big help. Helped keep track of all of the different aspects, of which there can be a lot if you've never gone through this process before. Like advice on inspections, financing options, closing day, etc. And she had a lot of different contacts to use, including an electrician and other types of laborers for a couple other things that needed fixing. And I have gone back to her for advice on a few things later, including walking through the house for advice prior to me renting it out (as she owns a few other properties). So she has turned into a useful connection.

Anyway, I do think that there are a lot of a little things to keep track of when you are going through it the first time and it can get overwhelming, so I don't think it hurts to have someone who can guide you. Just be smart if you feel like you are really not getting the help you want.

 
Random said:
Here's one. $20K list (been listed for 6+months, we could probably get it for $15K). Probably needs $5-$10K tops in work to get it rented, we would rent it for $700-$725. I might go look at it today.

http://www.realtor.com/realestateandhomes-detail/133-Piper-St_Sidney_OH_45365_M44117-59278?row=3
Click to expand...
I absolutely would invest in something like that.

Let's say $25k down, rent it for $700 with $100 off the top in property management fees. That's over $7k per year after fees, pays for itself even with expenses in less than 5 years. Compare that to the house I linked to above where you'll probably never break even.

 
Random said:
wilked said:
Random, your advice might work in a very slow market but I wouldn't recommend it for most (my two cents)
Click to expand...
I'm not disagreeing, but which part?
Click to expand...
skipping the realtor / calling your uncle to close the deal.

In my market (Boston) we would not have been considered for our offer. You absolutely need a realtor that can handle the 'list Wed / Open House Sat / Sold Tues' timeline and can advise on how much to overbid (since every house worth a damn goes over list). So we are on two extremes, and in the middle is a lot of ground too, but I would say the hotter the market the more a realtor is necessary.

That said, I highly recommend rebating realtors such as redfin and others, no way a realtor deserves the full 2.5%

 
FUBAR said:
Random said:
Here's one. $20K list (been listed for 6+months, we could probably get it for $15K). Probably needs $5-$10K tops in work to get it rented, we would rent it for $700-$725. I might go look at it today.

http://www.realtor.com/realestateandhomes-detail/133-Piper-St_Sidney_OH_45365_M44117-59278?row=3
Click to expand...
I absolutely would invest in something like that.

Let's say $25k down, rent it for $700 with $100 off the top in property management fees. That's over $7k per year after fees, pays for itself even with expenses in less than 5 years. Compare that to the house I linked to above where you'll probably never break even.
Click to expand...
If those were real (I am still doubtful) I can't imagine not quitting your job and becoming a full time landlord. Buy 5-10 properties over the course of a year and take it from there

 
wilked said:
Random said:
wilked said:
Random, your advice might work in a very slow market but I wouldn't recommend it for most (my two cents)
Click to expand...
I'm not disagreeing, but which part?
Click to expand...
skipping the realtor / calling your uncle to close the deal.

In my market (Boston) we would not have been considered for our offer. You absolutely need a realtor that can handle the 'list Wed / Open House Sat / Sold Tues' timeline and can advise on how much to overbid (since every house worth a damn goes over list). So we are on two extremes, and in the middle is a lot of ground too, but I would say the hotter the market the more a realtor is necessary.

That said, I highly recommend rebating realtors such as redfin and others, no way a realtor deserves the full 2.5%
Click to expand...
The relative I used was a realtor. She just never found anything for us (and she was a very highly respected realtor). I would call her, she would get the lockbox code, and we would let ourselves in to inspect (all bank owned vacant properties). She would call us for advice on some of her listings, but I found every single house we own. Just using Realtor.com. Very rarely do agents have access to something the public doesn't. Something in house thats about to hit the market, but other than that, nothing.

Yes, they provide comfort and guidance but ultimately they just want to get a deal closed.

2.5%?? Around here they get 6%!

 
wilked said:
FUBAR said:
Random said:
Here's one. $20K list (been listed for 6+months, we could probably get it for $15K). Probably needs $5-$10K tops in work to get it rented, we would rent it for $700-$725. I might go look at it today.

http://www.realtor.com/realestateandhomes-detail/133-Piper-St_Sidney_OH_45365_M44117-59278?row=3
Click to expand...
I absolutely would invest in something like that.

Let's say $25k down, rent it for $700 with $100 off the top in property management fees. That's over $7k per year after fees, pays for itself even with expenses in less than 5 years. Compare that to the house I linked to above where you'll probably never break even.
Click to expand...
If those were real (I am still doubtful) I can't imagine not quitting your job and becoming a full time landlord. Buy 5-10 properties over the course of a year and take it from there
Click to expand...
What part is do you doubt is real? Just look the property up on zillow. Look at the rent estimate.

http://www.zillow.com/homedetails/133-Piper-St-Sidney-OH-45365/2105953894_zpid/

 
Random, the 6% (or 5%, which I believe is the new standard) is split between realtors... that is where the 2.5% comes from (Seller's realtor)

And yes, if you have a realtor uncle who will kick back the full commission to you, of course use him! That is probably not most people though. What is more common is a realtor friend. These friends might stop being friends if you explain that you want them to close the deal for you but kick you back the commission

 
wilked said:
Random, the 6% (or 5%, which I believe is the new standard) is split between realtors... that is where the 2.5% comes from (Seller's realtor)

And yes, if you have a realtor uncle who will kick back the full commission to you, of course use him! That is probably not most people though. What is more common is a realtor friend. These friends might stop being friends if you explain that you want them to close the deal for you but kick you back the commission
Click to expand...
I never asked for (nor got) any kick back. Thats my point, a realtor is a realtor, and you will come out ahead doing your own legwork and just having them push the paperwork.

 
Steve Tasker said:
Random said:
Steve Tasker said:
While we're on homebuying talk, I have a really dumb question. As mentioned in a different thread, I'm in the market for a house. Great. Have some neighborhoods targeted, have a spending limit in mind.

So where the #### do I start?

Hire a realtor? Go to a bank and get pre-qualified before getting a realtor? Which bank, the place where I have my checking account? Some online bank? Aren't pre-qual letters kinda meaningless and non-binding? Do I just walk into the bank and go up to the teller like "uh I want to talk about getting a home mortgage"?

This feels really dumb, but I've tried researching this with no real solutions, and people I've asked have given me answers all over the map.
Click to expand...
1) You don't hire a realtor. The seller should pay the realtor expenses. If you want your own realtor they will split the commission with the listing agent.

2) Getting pre qualified is a great start. Shop banks, look for the lowest closing costs, land lowest rate.

3) I would find a few homes on realtor.com and call the listing agent. Some will recommend using your own agent, but if you find the house you want on your own using the listing agent has some perks (they will really want the sale and can use commission to bring down the price).
Click to expand...
Good info.

When you say "shop banks"....you mean just shop locally? Online?

Would there be a benefit to me hiring a real estate agent considering that I don't know the ins-and-outs of the homebuying process? I understand why someone like you who owns a bunch of properties wouldn't need one, but I don't want to just walk into something that I'm unprepared for and get swindled.
Click to expand...
I used a Realtor for my first home buying experience and it was a great experience. I had a good family friend who worked for a large agency (but wasn't an agent)....and blatently asked her who the best agent in their office was. She referred me to her, and I had zero regrets.

If you don't have that available, you can always ask friends/peers/collegues who they have used. I would avoid the posting on FB route, b/c evendently, someone always has a family member or whatnot and it could create an awkward situation. Worst case, interview a few agents from different firms and go with who you think feels right. You can always switch if it doesn't work out.

Your agent should be actively looking in areas that you are interested in, should be proactively making recommendations, etc. Go see lots of houses. A good agent will start to understand what you like/dislike about properties. The first home we bought was not one we originally looked at, it was a recommendation from the realtor based on previous homes we saw.

WRT "shop banks", look for mortgage brokers. In my experience, they all had better rates than local banks.

 
I'd start by going to Realtor.com, punch in your zip code, price range, bed/bath requirements, etc. Print off the list, scratch off the ones you dont want to see then drive by the others. Narrow down the list further from what you see. Then call a realtor to set up appointments to see whats left. Or use several realtors and pick the one you like best (again, I dont know how you shop for realtors).

 
Buck Bradcanon said:
Gamma1210 said:
Random said:
fatguyinalittlecoat said:
Random said:
So you're living in a $500K house for $1500/mo? I would rent as well. Or move.
Click to expand...
Our rent is $2188 a month. Zillow claims the house is worth $644K. :shrug: Those are the prices around here. Our house is tiny and old, it's the location that makes it cost that amount.
Click to expand...
I dont want to take this thread too far off topic, but do incomes support that?
Click to expand...
That ratio is probably any "nice" suburb in the northeast. Most rentals in my area look like they are around 0.5%. 5% seems crazy to me.
Click to expand...
:goodposting:

5%? Jesus. So rent in a $300k house is $15k per month? I'm missing something.
Click to expand...
A livable house selling for $20k. That's apparently what I was missing. $13/ sq ft on the one Random listed. My mind is blown.

 
I didn't mean to gloss over the fact that I'm sure it will need some work. The average is about $5K of stuff just to get it livable and somewhat nice. We are also able to get them because no bank will lend on houses in these conditions (most likely needs plumbing work, carpet, paint, possibly heat, maybe some cabinets). There is no chance it would pass a bank required inspection. These are not in livable condition as is. I have a very skilled business partner on these that can see/fix pretty much anything that goes wrong. We really only call repairmen for furnace issues.

 
Random said:
I didn't mean to gloss over the fact that I'm sure it will need some work. The average is about $5K of stuff just to get it livable and somewhat nice. We are also able to get them because no bank will lend on houses in these conditions (most likely needs plumbing work, carpet, paint, possibly heat, maybe some cabinets). There is no chance it would pass a bank required inspection. These are not in livable condition as is. I have a very skilled business partner on these that can see/fix pretty much anything that goes wrong. We really only call repairmen for furnace issues.
Click to expand...
Unless it needs 100K of work, it's just hard to fathom.

I currently pay .5% monthly rent (1600 on a 320K place) and to anyone in my position it's unfathomable that you can buy a place and make more than 10% of your purchase price back the first year of renting.

 
And so it sits. My guy drove by and from the sounds of it, we have no interest. It has tenants, is beyond run down, and looks like it would just take too much time to get it up to our standards. Maybe if/when we get caught up (we are still finishing up a duplex we bought in 2013 and have another house to do after that we bought in 2013 as well), but for now we have no interest. You guys make me feel guilty for not wanting that place.

 
So what about someone not as financially set up as JB, but is pretty set on staying in the area?

My job has a pension and I have an Roth IRA. In the bank I have enough to for a down payment (15-20%) on a condo. Larger size and mortgage+hoa would be about what I spend for rent right now.

Not married, don't have any kids. So this would be my permanent bachelor pad and I wouldn't mind keeping it long term to rent out once I out grow it.

Make sense to buy or keep renting?

 
Last edited by a moderator:
You must log in or register to reply here.

Similar threads

C
Credit Rating Question
Replies
8
Views
350
Juxtatarot
Juxtatarot
Statorama
Philly Travel Guys
Replies
18
Views
384
Statorama
Statorama
P
Audio advice. Replacing sub for old Polk satellite system
Replies
13
Views
217
Payne
P

Users who are viewing this thread

Total: 8 (members: 0, guests: 8)
Top