Homebuying horror stories: With problems like these, buyers should run
Readers share some of their worst encounters in the hunt for a home.
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Last month, we asked readers to share their real-estate horror stories: What had they seen at a listing that had made them run — not walk — out the front door?
In this installment of Buying Advice, we'll dish all the gruesome details about these houses and the problems that are just too scary for most buyers to take on.
We'll also check in with the latest sale and price statistics and examine the widening gap between buying and renting in most cities. (Bing: Checklist for first-time homebuyers)
Quite a fright
File this list under "five things you don't expect to see" at an open house or home tour:
1. A home with a criminal past? "Drug graffiti in the kids bedrooms" and "an automatic rifle in the corner of the master bedroom" certainly don't give most buyers a warm, fuzzy feeling. "No, thank you," said Irene Kreutzer, a Yelm, Wash., reader, after touring this scary house.
2. A death in the family. Note to sellers: Don't start a home tour with a look at the basement and the filthy mattress plopped down in the middle of the room under a bare light bulb. It's also creepy when you tell prospective buyers that your grandfather just died on the mattress, and that a mama cat had a litter of kittens on it. But what really killed the deal for reader Karen Vinson was the padlocked bedroom upstairs that no one was allowed to look into. "Talk about creepy," Vinson says. "I'll always wonder what was behind the door."
3. Call the exterminator. One cockroach might not be so bad, but a hundred? "Basschick," who replied to our online query, said she went out to see a condo that had been in disrepair, but was recently remodeled. It looked nice at first glance, she said, but while she and her husband were standing in the kitchen, a live roach landed on her husband's foot and scurried off. More inspection found dead roaches in the bathrooms, closets, living room carpet, kitchen cabinets and stove, as well as more than a dozen roaches in the dishwasher. "Our agent nicknamed it the roach motel," she says. "Basschick" checked in and checked out as fast as she could.
4. Misleading photos. "Kathryn" emailed Buying Advice with her memory of a listing that she couldn't wait to see: a neat home with a sparkling pool and beautiful landscaping — or at least that's what she saw in the listing photos. When she got there, it was a dead zone, complete with brown shrubs, a pool with just 2 feet of black water, a filthy interior and different flooring than in the photos. "It should be a crime to misrepresent something like that, or at least they should be required to note that the pics aren't current," she said. "What a waste of time!"
5. Unexpected guests. A homeless man had built a large fort along the back fence of a home that agent Mike Litzner of Century 21 American Homes showed to one of his clients in Long Island, N.Y. "Right next to him was his stash of alcohol," Litzner says. "My client asked, 'Does he come with the house?'"
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On a more serious note: Don't overlook these problems
However, what scares Litzner even more than impromptu homeless shelters are squatters inside the home, and bad tenants. These, he says, are thorny and often expensive problems to fix, so he advises his clients to stay away.
For Hickory, Ill., home inspector Jack McGraw, foundation issues are the real fright. "If your home inspector is recommending an inspection by a structural engineer," you might want to walk while you still can.
Walls that are bulging or that appear to be "pushing in" are another sign of major structural problems, as well as the vertical and horizontal cracks that accompany them.
Ditto for black, moldy walls and condensation that would require removal of a lot of drywall.
"That is a sign of a building having serious issues," McGraw says.
Damp insulation and rotting wood under the roofline are other signs of expensive roof damage that will turn your hair gray when you get the repair bill. Better to leave that home alone, he says.
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(House hunters: Are you putting your house hunt on hold for the holidays? If so, why? Or, conversely, do you think the end of the year is a great time to buy? Give us your opinion, either on Facebook or via email at email@example.com and we may include it in next month's column.)
Housing-market update: The recovery begins in earnest
Existing-home sales jumped 9.3%, to 4.82 million in August from 4.41 million a year earlier, and 7.8% from July, according to the National Association of Realtors.
Tight supply in many markets, including Florida and the West, and a declining number of foreclosure sales helped to push prices up. August's median home price of $187,400 was 9.5% higher than a year ago. The increase was the largest since January 2006 and marked the sixth straight month of year-over-year price increases, the last time that has happened since before the bubble burst.
- On our blog, 'Listed': Will the rise in home prices continue?
For-sale inventory continued to dwindle, reaching 2.47 million — or a 6.1-month supply — down 18.2% from last year, when there was an 8.2-month supply of homes available for purchase.
"The housing market is steadily recovering, with consistent increases in both home sales and median prices," says Lawrence Yun, the NAR's chief economist. "More buyers are taking advantage of excellent housing-affordability conditions."
According to the National Association of Home Builders, housing markets in most parts of the country are improving. The number of improving markets — as measured by upticks in housing permits, employment and house prices for at least six consecutive months — swelled to 99 in September from 80 in August. You can see how your metro fared here.
Where is buying better than renting?
With mortgage rates hovering around record lows, owning a home is now cheaper in all of the 100 largest U.S. markets, according to a report released recently by Trulia.
Looking at the average cost of homes for sale and for rent between June and the end of August — and assuming a 20% down payment, a mortgage rate of 3.5% and itemized tax deductions for mortgage interest, etc. — owning really trumped renting in some areas, such as Gary, Ind.; Oklahoma City; Lakeland-Winter Haven, Fla.; and Toledo, Ohio.
In each of these areas, the monthly cost of homeownership — including closing costs, maintenance, insurance and property tax — was more than 60% less than the monthly bill for rent, security deposit and renters insurance. In foreclosure-riddled Detroit, owning was 70% cheaper.
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Even in expensive markets such as Los Angeles, New York and San Jose, Calif., owning was 32%, 31% and 28% cheaper, respectively.
"Despite the recent price rebound, rents continue to rise faster than prices, and mortgage rates are near record lows," says Jed Kolko, Trulia's chief economist.
Of course, that spread thins if you look at buyers getting a 4.5% mortgage, who fail to itemize tax deductions and plan to stay in a home only five years. In Los Angeles, for instance, the cost of owning is only 1% cheaper. In New York, it's 3% cheaper to buy, given those factors.
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Of course, not everybody can afford to take advantage of these for-sale bargains. There's still the down payment to come up with, and buyers must have a good credit score — think 700 or more – to get access to these great mortgage rates.
Buyers can look at a full list of rent-versus-buy comparisons here.
We want to hear from you: As always, we welcome your questions. Submit them either in the commentssection below or on Facebook, or email firstname.lastname@example.org. Brief questions have the best chance of being answered.
As first time home buyers in our mid 20's, me and my husband were trying to find the nicest cheapest house we could. We saw ALOT of houses in disrepair an weren't afraid to get our hands dirty-to an extent. One looked really nice out on the outside, it was built in 1993 but looked like it was built in 2010 because of the design. I got excited. We walk in and it was a complete disaster. It was a foreclosure and there was holes in the walls. The previous owners ripped ALL of the appliances out, including breaking 3 floor tiles to get the dishwasher out. All the carpets were stained. There was writing all over the walls. The toilets? Don't get me started. All of them filled with you know what. The master bathroom had old vinyl flooring that was curling up at the edges and stained. The master shower was basically caving in. Also a film of brownish orange covered most walls in the house and you could see drip lines from it. The sliding doors to the porch had a broken lock on it and my realtor said there must be squatters that come here. I immediately left house. We looked at a dozen more and then I came back to that house. What I noticed about it was that it had good bones. It had an open floor plan and vaulted ceilings which was rare for the year that the house was built. Most imporantly the house was really cheap. The bank was asking 89k for it. We got it for 77k which included the 5k in closing costs that WE had to pay b/c the bank didn't want to put forth any money. We ripped all the flooring out, replaced the 3 broken tiles, bought all barely used appliances, fresh neutral paint everywhere, put down laminate hard wood flooring in living room. It is like night and day now and I would estimate we maybe spent at max 4-5k for all the repairs. Our entire mortgage payment is $650/month and everyone cannot believe that is all we pay for this house. Even right now in this crappy economy we could easily rent the house for $850/month.
To anyone looking at houses I would say don't be afraid to get your hands dirty. If you can see past all the grime and filth, you could turn that house around and make it amazing for yourself.
After my post, I began reading the posts of other bloggers....
This is one of the most interesting batch of posts that I have read in a long time. Great stories to tell here. Thank you all, for your honesty and experiences.
In this market more & more people are facing foreclosure or in a distressed property they cant sell. With all the House Flip reality shows there are more individuals trying their hand at real estate as a source of income. Brock & Davis REI works for both the seller & emerging buyers.
We work with motivated sellers, whatever the reason, to match them with our network of buyers.
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My apologies for the long post, but this will take more than a couple of lines......
My previous home was a foreclosure. The homeowners were forced to sell by the bank. Not my fault. But guess what? The owners didn't see it that way. And they had some skeletons in the bedrooms, too.
Before I took the keys, the previous owners trashed the house. Food on the walls, open fire barbeque in the game room, marked up walls, etc. But the oddest of all, were the bedrooms.
Each room had a padlock on the outside. And the rooms appeared to have been used to sleep more than a couple of kids. I was concerned.
After some several mail deliveries, I found that the previous owners were clothing mfgs. from Korea. They had a shop in the city, too. After talking around, it became clear to me that they had been keeping slaves in the bedrooms. People brought from Asia to work for their freedom by producing clothing at no charge, but food and and a spot on the floor to sleep. Makeshift beds were everywhere.
I was too frightened to report it to the authorities then, but since moving away, I've taken every chance to bring this issue to light. Who needs horror films, when genuine horror is real, here, and now?
Let it be known that slavery is alive and well, not only in the world at large, but in your own neighborhoods, maybe right next door.
Another thing that helped was riding bicycles around the area. We really got a feel for things, the neighbors were not suspicious of us, as they would be with a strange car, and we learned a great deal.
As for being denied on the bank loan, while having a 700+ credit score....it has been several times we have been denied now...for the same reasons.. I was denied because I get back most of my taxes at the end of the year, due to write-offs from having to travel so much for a job, which makes me look like to the loan officers, or brokers, as if I make next to nothing. I actually asked the last broker I dealt with..out of Charlotte...' I made $43,000 last year...um...So, IF I let the government steal my money at tax time...which isn't theirs to begin with, THEN the banks will give me a loan? But, since I keep my money to buy groceries for my family, pay off my bills, and fix my old vehicles, you won't even give me $5?' She said, 'Well...uh...yes.'
Sure seems like a great scam for someone...
I bought a house looonggg before becoming an atty later in life to help, esp 4-legged underdogs, and long before the internet became the norm. We were fairly young, it was our first house but countering our naivete was our parents, who taught us a lot. We also read every newspaper article we could find on home buying, and followed all their guidelines.
We hired an indep, certified engineer from a neutral source (ASHI), but even he was no match for some of the FSBO owners trying to cover things up. Dad was as good as an engineer and insopected each finalist. Then, it was down to one in NJ.
Dad got out of the car and immediately saw that one outside wall looked bowed. He went into the basement, where we could smell the new carpet, drywall, paint and celing tiles (we knew that was always a red flag). The engineer asked if he could remove a panel and look and the h/o said no! (this was 5 minutes after he bragged about moving to a very expensive town). So, Dad, a Marine and police officer, asked the h/o if he would do anything to protect his daughters, and h/o said yes. Then, as Dad removed the pinball machine and stuffed animal heads the h/o had blocking the area where he just KNEW there was structural damage in the sill plate, Dad said "So, you understand what I have to do now to protect one of my daughters". H/O picked his cuticles until they were bloody and glared as Dad did this.
When we saw what was behind the wall, Dad told us privately if we wanted to go ahead, he could get it fixed for about $5K (but normally, would cost $20,25K)-involved structural damage and he would have to bring in guys to work on it-he couldn't do it alone and even if he did, there were a lot of supplies needed . Owner refused to take a penny off and we left. Later, we found out the house eventually sold for $25K less and after he spent a fortune on a bridge loan-at that time, 16%.
I nixed this one house, although husband loved it (gorgeous house) because it was too close to a farm and the LIRR. LI, like many other areas, has a high breast cancer rate, probably from pesticides, and other chemicals leaching into water supply (aquifers supply water out here, unlike NYC). One day, I turned on the local news, saw the new owner complaining the adjacent RR area was overgrown and dry, so the trains started fires! He said he has to keep running the sprinkler back there to keep his yard and the RR property moist. Then, I went to a zoning board meeting and there were the people who bought the house and 20 neighbors, complaining about the chemicals and stench from their new line of business making compost. If it is warm out, and especially if muggy, the stench was unbearable. Add in the big trucks, vermin, flies... I resisted the urge to come home and say "told you so".
Now, I know it is worse-meth houses, copper pipe and other stripping by tenants, angry people getting foreclosed upon, vagrants, all the things people on this board mentioned, etc. I dread moving but it is very expensive here (taxes) so something to consider-bite the bullet and do it. Thanks to all who shared their experiences-we all can learn a lot from them.
I live in a 1950's neighborhood. We have spent a ton of money updating and maintaining our home. All of our neighbors have done the same......except that one house directly across the street from us. They have crap galore all over. They have 8 children who are absolutely filthy as are the parents. There is a smell that drifts over once in awhile. Numerous e-mails, phone calls to the city have yeilded nothing. The house next door to them has been vacant and for sale approximately 2 years and the listing price keeps dropping. It started at 200K and is now under 100K. I have seen prospective buyers pull up in the drive way, get out of the car and look over at the neighbors and get right back in car. LOL...they are the smart ones. Some will actually humor themselves and take a quick 3 minute tour. We would sell our home to get away from this, but who would buy our house having to look over at that crap? We sit on our hands and hope they will leave soon. They don't own the house and we have no idea who does. So the moral of the story is not only do you need to be wary of the house your buying but look close and often at the neighbors. I know when I buy again, I will puruse the neighboorhood at all hours before buying.
A couple of years later, after major repairs, I still live in the house because I would not be able to find another place that is pet friendly and has a washer and dryer and central air for the same low rent. But recently I've noticed a wall curving in the basement...