OT: First House

[jethreauxdawg]

All that said, never spend more on upgrades than your price per square foot.

So if your house values at $150k for 1500 sq ft that is $100 per sq ft. No matter what upgrades you do, if the whole neighborhood doesn't increase you won't make money unless you add sq. Footage. Expensive bathroom and kitchen upgrades are only for undervalued or long term homes. Too easy to get the bug and get burned if work moves you. I lost $12000 over this about 10 years ago.

Preach. Any upgrades done to the house need to be done only for your personal benefit. Just assume you will never recoup those dollars. I thought I was going to be in my previous house for a long time. Spent a lot on interior and exterior improvements. Things changed and we decided to move. Those things may have helped catch potential buyers eyes, but my house actually sold for slightly less per sqf than my neighbor who had a very similar house and did absolutely nothing to it. I don’t really regret the work we did, because I enjoyed it while living there, but banks doing appraisals for potential buyers only see the price/sqf of the houses around you.

 

[dorndawg]

Obviously.

 

[johnson86-1]

What he said, plus risk. Nobody ever factors in risk.

You could just as easily say that about the people talking about paying down a 30 as a 15 or just going with a 15 in general.

A 30 year fixed mortgage is a fantastic inflation hedge and if you drop the difference between a 15 and a 30 into an index fund, even if you don't beat your interest rate, that's still a nice cushion to have in case something goes wrong. If you are on a 15 year note, you can't easily tell your bank you'd like to pay a couple of hundred less if you have an income shock. If you are paying a 30 like a 15, you can pare your payment back to the 30 year payment, but you can't easily get back all the extra payments you've made if you need the cash.

On the flip side, if you finance for 30 and put the difference into an index fund, you have access to that cash and a lower payment and then when you get enough money to pay off the note completely, you can pay it off and then you really have reduced your risk by eliminating that monthly payment.

 

[MSUDAWGFAN]

If you plan on making any upgrades or any work - flooring, cabinets, painting - do it now if you can afford to. Don't say you'll do it in a few years. Much easier to do before you move in. It's a real pain to have your kitchen out of commission for a month or longer while you're remodeling it.

Does it really take that long? I just bought in December and its our forever home so I want to eventually remodel the kitchen with Subzero Wolf appliances, but need to redo the cabinetry to do so. Its going to take several years to save up enough to do this, but its something I've wanted to do for a long time.

 

[patdog]

You would think. But a lot of people make that mistake.

 

[msualohadog]

One thing nobody has mentioned yet are the schools. Check the ratings of the high school. Real estate value follows high school ratings almost dollar for point. You may not have kids, but most people do...

 

[Dawgtruc]

Better off renting and investing your money in growth stocks.

I beg to differ.

Equity in a home that is in a rising property value market is like gold.

 

[horshack.sixpack]

No, the point is that you CAN afford a 15, however, should you get somehow displaced from work, like say...a pandemic that shuts down the country; well then you'd only be on the hook to come up with the lower payment. It's about risk and cash flow management and if you are paying at a 15 yr clip on a 30 you are giving up very little extra interest to have that security.

 

[garddog]

Does it really take that long? I just bought in December and its our forever home so I want to eventually remodel the kitchen with Subzero Wolf appliances, but need to redo the cabinetry to do so. Its going to take several years to save up enough to do this, but its something I've wanted to do for a long time.

Make sure if you buy SubZero that the place you buy from has a tech to work on them. Do not buy anything that can't be repaired locally. I have seen houses in rural areas where those big, built in units just end up dry storage because there is no one to fix them locally.

 

[dorndawg]

Are SubZero's that unreliable? I've never had one, but I have seen the price tags - I'd be right salty if I bought one and it didn't last a long-*** while.

 

[garddog]

Are SubZero's that unreliable? I've never had one, but I have seen the price tags - I'd be right salty if I bought one and it didn't last a long-*** while.

I was in the appliance sales, installation end of the business for 10 years. Refrigerators across the board avg 10 years life expectancy. That is from the old top freezer units to the high end subzero units.

Inflation in appliances was non existent for 30 years, then the price of steel went up about 5 years ago and there was a price increase especially in the lower end. If you don't have the inflation in price then you have cheaper parts used. Amount of metal way down. Ice makers are the bane of this because they are 90 percent plastic now, even the gears.

Subzero is just hard to get repaired outside of a metro area.

I would suggest to anyone in a rural setting to look at KitchenAid, owned by Whirlpool, which you can get worked on.

 

[thatsbaseball]

Will there be a police dept. where you live ? **

 

[doglegs]

Don't get a warranty through America's First Home Warranty. Kept it going on our house just waiting for the old AC to go out so they would have to replace it. After 5 years of little patch jobs it finally bit the dust and they agreed to replace it. However, we're now on week 3 without AC and not scheduled until next week. They have been absolute tornado of cheapskates and red tape. I can't imagine any other warranty company being this bad.

 

[dorndawg]

My guess is they are all about the same. Simple math dictates they aren't replacing many expensive systems.

 

[My Bru]

Don't get a warranty through America's First Home Warranty. Kept it going on our house just waiting for the old AC to go out so they would have to replace it. After 5 years of little patch jobs it finally bit the dust and they agreed to replace it. However, we're now on week 3 without AC and not scheduled until next week. They have been absolute tornado of cheapskates and red tape. I can't imagine any other warranty company being this bad.

Nope they are all that way. 5 years of 500 bones for the warranty, you'd have $2,500 saved now for it. And you'd get exactly what you want, rather than have to do what they tell you.

 

[My Bru]

A 30 year fixed mortgage is a fantastic inflation hedge and if you drop the difference between a 15 and a 30 into an index fund, even if you don't beat your interest rate, that's still a nice cushion to have in case something goes wrong.

I understand math. The problem is reality. Nobody is going to do that. 80% (probably much higher), that money will simply be spent on crap that doesn't build equity.

And if a 15 year note is 25-30% of your take-home pay, you won't have that problem you speak of above. It'll be easily affordable for you.

 

[doglegs]

Definitely wish I had just saved for it instead now. I get that they're going to patch up whatever they can. Although $2,500 ish in premiums is still saving me a few bucks against the quotes I got for replacing it myself.

But taking a month to replace a unit they agree is done, in June, in Mississippi, is ridiculous. It's the service side of it that should be better and probably is at most other warranty companies. Certainly can't be any worse.

 

[garddog]

Definitely wish I had just saved for it instead now. I get that they're going to patch up whatever they can. Although $2,500 ish in premiums is still saving me a few bucks against the quotes I got for replacing it myself.

But taking a month to replace a unit they agree is done, in June, in Mississippi, is ridiculous. It's the service side of it that should be better and probably is at most other warranty companies. Certainly can't be any worse.

It is the same at all warranty companies. They pay the worst to the contractors, so the contractors consider it side work. Basically they pay just enough to keep the worst contractors on the line. The good ones won't take the work because they are too busy. Even the bad contractors are going to relegate your priority down because of what they make from doing home warranty work.

 

[jethreauxdawg]

Subzero refrigerators should last 30 years.

Are SubZero's that unreliable? I've never had one, but I have seen the price tags - I'd be right salty if I bought one and it didn't last a long-*** while.

I believe they are the only brand to have two compressors, one for fridge and one for freezer on a split system. That really helps the reliability.