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FIND YOUR DREAM HOME OR APARTMENT

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Feb 5, 2014 8:26AM
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I'm in the process of purchasing my first home.  I plan on paying cash.  There aren't many people who do this in Cleveland nor in my family.  I feel that this is one of the best purchases I've made.  (I also have a 2013 Kia that is paid off).  I look forward to living debt free.  
I am self employed, therefore my income what I make of it.  
While my banker feels that paying cash for my home will hurt my future finances, I believe that the future is now and I can always rebuild my portfolio, but this part, the car and the home is a done deal.  I'm grateful
Sep 21, 2013 4:08AM
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Nearly 1/3 of real estate transactions were cash (in April 2008)...what an incredibly irresponsible picture to paint !! How about for the year...or since 2008 until now ?? Using only figures containing those April 08 forclosure auctions, you have drastically skewed your numbers and given rediculously bad advice.
Sep 12, 2013 1:53PM
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It's great the economy is percolating if not perking, though not great for those in debt misery.

There are all kinds of economic predictions, and favorables & dissents  about almost everything

that's called "political economics" across the Atlantic pond. I'll further confuse the cash nissue

by boringly postulating, because I'm a milquetoast boar if not boorish. The likes/dislikes tell me so.

Because I can't stop with brief lines--I write for me not ye mutha- likers/dis-likers.  Of course I care

about evaluations, though my candid reaction is t.s. IAsk your gandpa privately what t.s. stands for Hint: It has something to do with Putinism. And if Shakespeare had posted

in his thoroughly modern 17th (whatever) century, would he be renowned? No, because

his ratings would be low, and altruistic commercial sponsors rare. Because who understands

sonnets, and especially John Milton's stuff. Not me, but if vous do, then great. I do not have

the intelligence to understand most poetry, allegories and symbols. 

My poetry is  delightful, if accompanied with glass of water in drought. Take Roger

Bacon, ditto. There is little better than a BLT and lime-aid, and we have Bacon to thank if

not Lettuce, Tomato, and Mayo on White. Tomato sandwiches without lettuce and bacon,

but on white enriched with high calorie and fat mayo do make me feel satiated but guilty for violating

the protocols, tenets, customs, folkways and mores of the prevailing mainstream Sandwich Culture.

On sandwich I shall never experience is banana peanut butter, though if this diabetic 2er

is starving, then bring it on. If your buyer is buying your '98 Civic in cash, then don't, because

 Ben Franklins and Andy Jacksons could be laser printed.

Aug 6, 2013 10:30AM
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Do you really need an entire article for this?  If someone brings me cash I will take it and run.  Why wait for the bank?
Aug 6, 2013 7:06AM
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We keep getting told that if you have a mortgage, you are paying all that extra money in interest.  But most people couldn't buy a house without a mortgage, so the home market would plunge.  In addition, when you have a fixed-rate mortgage, your payment stays the same for the life of the mortgage.  You are paying for your home with increasingly inflated dollars.  That $250 mortgage payment of 1975 would have still been $250 in 2005 when it was paid off.  The owner also got to deduct the interest.
Jul 30, 2013 9:45AM
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I just read an e-book on amazon that gives info about buying a house. Like how to know what you can afford, not what the mortgage brokers will approve you for. It's called "Stuff I told my kids about..buying your first house". No fluff. I liked it because it had info to help you when dealing with real estate people. Might be worth a look.

Jul 19, 2013 2:53PM
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How is no appraisal contingency a good thing?? You had better get that cash purchased house appraised because wouldn't it stink to pay more then it is worth??? I mean, I always feel like some of these things the bank makes you do are benefitting you... not just the bank. Like the title insurance (at least they admit that is still important). Lame.
Jul 19, 2013 8:01AM
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Only stupid people, that sell there homes and not put down all the earned  equity on there next house an pay them off earlier, so when they sell there owned home,they have the cash to bargain with. Not just Oh, I'll just put down a small deposit and go and spend the rest. These people don't understand that this cash is strictly for buying or building a house.
Jul 19, 2013 5:00AM
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Those cash buyers are members of the elite rich.
The rest of the 99 percenters have to suffer like always.

Jul 19, 2013 3:36AM
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You are a complete ****!!! Less than 1% of homes are purchased with cash!!! You need to

get a real job!!!

Jul 18, 2013 12:27PM
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While the information provided is generally correct the conclusions provided (either implied or expressed directly) are as much 'generally' a bull...  Each single point stated (with one single exception) has as much 'positive' side to it as 'negative'. While currently there are corporate and some individual investors who are overfilled with cash they want to invest somewhere else (besides of what they already have invested) it does not mean paying cash is a good strategy for average people buying a house. Even if its second property for investment purpose. I never buy any consumables (like clothing or food, vacation, etc.) on credit - my Credit cards are simply charge cards I use to buy what I have cash for. But house? Always, and particularly now with todays interest rates the mortgage is actually a very good way to make some money. Not having a mortgage is a one big lost opportunity. Unless your goal is to get a house now and sell it at higher price within 2-12 months, what they call flipping. The interest you pay on mortgage is lower than almost anywhere else, plus its tax deductible, plus your monthly payment is efficiently getting less and less due to inflation. Even after ~5 years into mortgage you can already feel its easier to pay (unless of course you unwisely overextended yourself and simply dont have any money to pay).  The money you did not pay upfront for the house meanwhile can be used to generate income elsewhere. I could payoff my mortgage today but it would be really stupid - instead I just refied with more cash out so I can have cheap money to invest with higher interest.  Heck, I dont think even buying a car for cache is always a good idea. Actually, its very simple from the other angle - you can't buy house if you dont have ca**** too expensive. But you CAN buy it taking a mortgage. Because its cheaper that way. Then why do it expensive way even if you can? So of course all-cash offers rule the housing market. Or any market for the matter. Pay cache if convenience or imperative to just to nail particular deal is very important to you. But dont say that such a deal is more profitable in any way.  If you are not one of those sharks that are flooding housing market now with intention of short term investment then the prudent strategy would actually be paying as less as possible cache upfront and reducing monthly payments not by paying cache back to the bank but by reducing principal instead (like getting into 40 years instead of 30 years loan or even taking long term ARMs, etc.).
Jul 18, 2013 12:12PM
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I believe that cash is king, but...

We're talking about a LOT of cash... You're probly good if you're ready to show where it all came from....
but...

What about alternative places to put that cash that'll pay a better return than the house's appreciation? ... and the benefit of the tax break on the little bit of interest that the current low rats allow?

And the lines about 'no escrow' and '0 monthly payments' are misleading - even if there's no mortgage, the homeowner still has to pay property insurance and taxes, which can be as much as 40-50% of the the mortgage-holder's house payment. Assuming property taxes of $8,000 a year and taxes of 4,000 a year, it's still going to cost $1,000 a month to live in the house BEFORE utilities and other expenses...!

Jul 18, 2013 11:49AM
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Having been a Realtor in Las Vegas, NV, I can tell you your article is pure crap.  An assembly bill in Nevada stopped foreclosures, artificially raising prices by effectively reducing availability of homes for sale.  People who remained in their homes (and continued to skip making payments on their homes) used their money to bolster the local economy instead; buying new cars, blowing money on fancy restaurants, etc., so that the jerks who are running our country can point to the growth in sales of products, and the rise in housing prices, and say we are in an economic recovery, folks!  Things are booming again!  Really??  People are paying cash over list price, because they cannot buy a home otherwise.  Why?  The truth is that there are so many investors (mostly foreign, but some domestic) snapping up all the available inventory, that anyone trying to purchase with an FHA, Conventional or VA loan simply cannot compete with the cash buyers.  Homes at artificially inflated prices cannot stand up to an appraisal, and therefore, cash buyers are the ONLY buyers who are not bound by that constraint  They are not required to have an appraisal.  A fortunate few Buyers find help from "gift" money from family members so they can offer to pay the difference between the accepted grossly inflated offer price, and the much lower actual appraised value, but given a choice between accepting an offer contingent on a loan approval, or an offer for cash, most Sellers take the cash and reject all other offers.  They would be stupid not to.  Cash deals close, loans might never happen, "gift money" might not materialize.  I am sick of so-called "experts" who do not actually work with Buyers and Sellers helping the powers that be dupe the public into swallowing more nonsense.  The media is not reporting the facts in any sort of responsible fashion.  You're selling stories, not actual real estate.  The little guys are sitting on the sidelines while the sharks are gutting our country.  Sorry if you didn't want to hear it, but that's what's really taking place.  I feel sorry for our whole country, and all of our hard working Americans who once again are being flat-out lied to.  Bob Dylan sang "You don't need a weatherman to know which way the wind blows".  I say if it walks and quacks like a duck, it's a duck, not a freaking chicken. Print the truth, or keep your trap shut, okay? 
Jul 18, 2013 11:24AM
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i always said and believe, "Cash is KING" Save and pay for whatever you want in cash and what you do not have you do not need, except cash. If I can do it you can do it.  I am not rich but saved, saved, and saved. Then bought and paid for it. IN CASH.

 

Bingo

Jul 18, 2013 11:23AM
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I always said and believe, "Cash is KING" Save and pay for whatever you want in cash and what you do not have you do not need, except cash. If I can do it you can do it.  I am not rich but saved, saved, and saved. Then bought and paid for it. IN CASH.

 

Bingo

Jul 18, 2013 10:57AM
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It's funny, most countries would not allow us to purchase in their countries...cash or not. Yet we allow anyone and everyone to just move right in take our land, real estate and anything else they can get pushing our own out. America is a greedy place with no care about it's own people or futures.
Jul 18, 2013 10:34AM
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It seems that most lower end homes sold here recently are to investors/people coming from other countries.  They have the cash and know that if even prices remain flat for the next 10 years, They can still make a pretty good return on their investment by collecting rent.  What I struggle with is that they are driving the prices up and hurting the ability for 1st time home buyers. 

Now, we bought a $50k home in Sacramento, Ca. with cash by cashing in our IRA's and my wife's severance "bonus" when her company was sold.  The only reason we were able to get this home was because the Fed/lender(fannymae/freddymac) that foreclosed on it required that owner-occupied had first rights.  The 5 other offers were investors who had multiple properties when title searches were done.   All of those 5 offers ranged from $8k to $30k more than what we paid.  This place was a fixer with no kitchen(everything was stripped).  Many of these offers were trying to use other family members to purchase.  Btw, all of them were Asian or Russian/Ukrainian descent and from what agents have told me, it's all foreign money.   

So, basically, we were at the right place and the right time.  Too bad my kids will probably never get a chance like this.

Nothing is going to be done about foreign money flooding the market until the government and the banks are able to dump all of the underwater homes/foreclosures.  By then, if ever, it will be too late.

 

 

 

Jul 18, 2013 10:05AM
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Well no steaming horse manure!! Plunk cah down for anything and you are king of the mountain. What percentage of American's can "PLUNK" cash down to buy a home or vehicle. Those who are not living off of various government hand outs are streching paychecks (If they are lucky and have employment)  and increasing their credit card debts or borrowing or living with who they can to survive. The American dream?? Our Washington racialy biased politicians might print two trillion more dollars in paper money but will the middle class Americans benifit from it?? The way our seemingly on a conspiracy course Washington politicians are going there is going to be "Some Plunking Down alright" as Americans are waking up and it won't be money that they are plunking down. GOD BLESS AMERICA 
Jul 18, 2013 8:47AM
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A great deal of the cash purchases are coming from investors, or parents that have cashed in their investments to help the kids.

NAR (National Association of Realtors) recently released a statement saying a lot of the investment money is coming from China. There is no doubt in my mind (Realtor for 28 years) that foreign investors are taking advantage of a market where the possibility of getting higher rents is real. More renters, fewer owner occupants makes an increasing rental market. The unsettling part of that is in a few years, 20% and higher numbers in your neighborhood will be owned by people and companies out of our country. We, as a country are loosing control of the land in our country. Most malls and office buildings are not US owned either. We have to be cautious and see what can be done to fix that. This is frightening.

The problems are involved and go back to the easy money of the mid 2000's and the real estate crash, then the entire economy (part of the crash). I am not an economist, but a Realtor pounding the streets to find houses for my buyers. I see clearly the Dodd Frank Act was an over reaction and a reaction of our legislators thinking that fraud and poor investments on behalf of the lending institutions were the responsibility of the Federal Government and ultimately the US people. The Dodd Frank Act which is designed to tighten the lending rules perhaps had good intentions. But better intentions should have been what you tell your kids - you spend unwisely, I will not help - it is your problem. Rather now the regulations of that act are strangling the lending institutions as well as those who want to sell property with an "owner carry" loan. Yes, they are controlling your money as well!!

The theory that home buyers should have a great job of over a year, great credit and tons of cash is good in theory, but makes it impossible for the self employed and others to even think of buying - which makes renters out of a lot of us. If the building industry is getting better, it is for the few with a lot of money, those that have moved up in the house value chain or multi family housing. Example - John and Jane sell a house to an investor for $120,000, with multiple offers and an original asking price of $100,000 They move to a house listed at $200,000 where they compete on several properties and end up paying $230,000 for a property listed at $200,000. Those owners, Dave and Suzie move to one at $350,000 and on up the chain. The buyer occupant is priced out on the lower end which means fewer young people with families are able to buy. This opens up the market to those who have cash and ultimately foreign investors. If it were not for foreign investors, the market would do what it did in the past - values would go down with fewer qualified buyers.

 

Think seriously - we need to fix this in a real way. Tightening  the lending regulations and making it harder for you and your kids to buy a house was not even putting a finger in the dyke, it was pushing it down. Repeal of the Dodd-Frank Act could help.

Jul 18, 2013 8:32AM
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Although getting a mortgage today requires more documentation than the "warm-breath" procedures of 6+ years ago, the major point "cash-buyers" are missing is that "home equity" is NOT A) liquid, B) safe, or C) earning a rate of return!  Sure, the house may go up in value, but, under no control of the owner!  Investing "cold hard cash" into a liquid investment does create liquidity, safety (can be withdrawn on a moments notice) AND a rate of return.  There is a good possibility you could still out pace the cost of a mortgage with a diversified investment portfolio, growing 2 assets at once (house AND investment portfolio) instead of suffering from "depression era" thinking of "owning your home outright"!  Which you rather be in your old age, "equity rich and cash poor", needing to take out a reverse mortgage just to be able to live, or have a small mortgage and a bunch of cash?
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