Jump to content

OT: Advice for a new homeowner


mhdousa
 Share

Recommended Posts

This is not about investing, but I thought I'd pose this question to the smartest, most practical group of people I know.

 

My wife and I are about to close on a house in the suburbs of New York City. We're in our mid-30s and have a toddler.  As many houses in this area are, the house is on the older side (built in 1952) but is in fantastic shape (our inspector thought it was really well-maintained).  Given the area, and the local property taxes, the payments won't be cheap, but we're well within our budget.

 

What's the best advice you can give a new homeowner?

 

Thanks!

-M

Link to comment
Share on other sites

learn some basics about house Maintenance. Basic plumbing and upkeep of the house like winterizing it, a bit of basic carpentry and painting. Save you a small fortune in call outs and keeping the place in good shape can prevent bigger problems later.

Oh – and put in a decent bathroom , keep the wife happy.

 

Then obviously set up a man cave…

 

Link to comment
Share on other sites

learn some basics about house Maintenance. Basic plumbing and upkeep of the house like winterizing it, a bit of basic carpentry and painting. Save you a small fortune in call outs and keeping the place in good shape can prevent bigger problems later.

Oh – and put in a decent bathroom , keep the wife happy.

 

Then obviously set up a man cave…

 

 

the KITCHEN! update kitchen

Link to comment
Share on other sites

Think of your house two ways. First, as a place to build a family, a community, and great memories. Second, as a source of large hidden liabilities like a new roof, new HVAC, new garage door opener, etc., that will pop up unexpectedly. In addition, there's the constant updating to keep the Mrs. happy. These are all bills that will come due eventually and you'll need a good cushion of cash to cover many of them.

Link to comment
Share on other sites

All good advice so far. The best advice I can give to any home owner is don't borrow against your house for anything other than money you need to spent on your house (like say a new roof).  So many people got into trouble borrowing for vacations, RVs, Christmas gifts, cars, you name it.  There are people who have lived in their house for 35 years and despite the fact that they originally paid a ridiculously small amount for their home (by today's prices) they still owe more than its worth and can't retire because they have a mortgage to pay.  30 years from now if you still live in that home you want it paid for.  Congratulations, btw.

 

Link to comment
Share on other sites

 

the KITCHEN! update kitchen

 

man cave is cheaper.

 

The kitchen I would make functional and then save up a fund for repairs and improvement. whne you have enough to do the kitchen properly then do it. Worth it if you intend to live there a while - not if you are going to move on in a few years.

 

 

Link to comment
Share on other sites

There is good advice here.  Houses are money pits.  Expect the unexpected with a house.  Understand that there will almost always be something wrong that needs to be fixed.  Make sure you have funds available to do what needs to be done.  I heard at one point that you should assume about 1-2% of your cost a year in upkeep, repairs, etc.  I have no idea if that is accurate or not, but over the longer term it's probably as good as anything.  The advice to learn a little home maintenance is good, but if you're like many of us and that is beyond you then make sure you find a good electrician, plumber, handyman, etc.  You don't want to be scrambling to find someone when you need a plumber quick, for example. 

Link to comment
Share on other sites

Houses are money pits.  Expect the unexpected with a house.  Understand that there will almost always be something wrong that needs to be fixed.

 

This is all very true.  I'd never go back to renting for the reasons I said here (mhdousa, you should read this thread as it is evolves to this topic), but it cracks me up when I hear people say that their house is an investment.  If I was analyzing my home as a possible investment I would absolutely never buy it.  I've spent so much time and money on my homes over the years it isn't even funny, and I'm someone that tries to do almost all maintenance/upgrades/repairs myself.  When I hire someone it is because something I tried to do went horribly wrong.

 

 

Link to comment
Share on other sites

 

  When I hire someone it is because something I tried to do went horribly wrong.

 

I've never paid anyone to fix something that I've done first.

 

 

(ok - I've only been in this house a few months so nothing has gone wrong that I've touched..... but it will :D )

 

 

Houses will cost you.you can mitigate some of the expenses - or at least postpone them...

Link to comment
Share on other sites

Stitch in time saves nine definitely applies.  Walk around once every few months and do an inspection.  Look around for major problems, or minor ones that may become major such as peeling paint, leaky roofs, plumbing leaks, foundation cracks or settling, gas leaks, etc.    You want the thing to stay plumb and dry. Problems occur when you have structural problems or water getting in where it shouldn't and you don't take care of it promptly.

 

There are a lot of common sense things.  Too many to list them all here.  Find out where to shut off your water.  Put in smoke and co2 detectors and put it on your calendar to check them.  Try to get on friendly terms with the neighbors so that they'll help you when you need it.

 

If anyone tells you that ripping something out and putting in a newer and better version will make you money, be skeptical.

 

Don't hire a contractor off craigslist.  Get one that's highly rated on BBB, that's been around a long time,  that is recommended by someone you know.

 

Also,  make sure to not buy during the biggest housing bubble in history.

Link to comment
Share on other sites

Add 15% of the cost for the decorating, drapes, furniture, etc. that you do not know about yet  ;)

 

Estimate the replacement cost of your major outlays (car included), straight line over the remaining expected lives, & put the monthly depreciation (as cash) into additional mortgage payments. When the roof goes, borrow against the house to pay for it; but in the meantime your mortgage balance is declining & savings are compounding at your mortgage rate.

 

Live in the place, & close your eyes to it being an investment for a good 5-10 yrs. In most cases; legal fees, closing costs, agent fees, drapes, taxes, etc. will more than outweigh any gain from a quick flip.

 

Congratulations & good luck!

 

SD

 

Link to comment
Share on other sites

 

  When I hire someone it is because something I tried to do went horribly wrong.

 

I've never paid anyone to fix something that I've done first.

 

 

(ok - I've only been in this house a few months so nothing has gone wrong that I've touched..... but it will :D )

 

 

Houses will cost you.you can mitigate some of the expenses - or at least postpone them...

 

You must be a better plumber than I .  :)

 

Link to comment
Share on other sites

 

  When I hire someone it is because something I tried to do went horribly wrong.

 

I've never paid anyone to fix something that I've done first.

 

 

(ok - I've only been in this house a few months so nothing has gone wrong that I've touched..... but it will :D )

 

 

Houses will cost you.you can mitigate some of the expenses - or at least postpone them...

 

You must be a better plumber than I .  :)

Its in the genes!! My grandfather was a plumber!  Not that it helps – all I’ve done so far is get the garbage disposal working replace a couple of moen mixer valves for the shower bath units and fix  a leak in one of the toilets. Nothing that a bit of research on the internet won’t tell you and nothing major.

 

Theres no guarantee they will stay fixed!! It was worth doing as the work involved in the mixer valves was mainly grunt work and using the right tools to extract the old ones.

 

Do now have another leak on one of the toilets that I have to fix – got to work out where its coming from. I wouldn’t attempt anything too major though!!

 

 

Doesn't make me a plumber though - and certainly not better. I'm way slower than a qualified plumber would be!

Link to comment
Share on other sites

If anyone tells you that ripping something out and putting in a newer and better version will make you money, be skeptical.

 

Don't hire a contractor off craigslist.  Get one that's highly rated on BBB, that's been around a long time,  that is recommended by someone you know.

 

I build custom homes for a living and I say the best recommendation is one from a friend or family for contractors. The best and most reliable contractors I've found in my years don't advertise and are usually pretty busy.

 

And yes, that kitchen renovation that will increase your home value by $40k as claimed by the realtor, never includes the upfront cost of doing the job in the first place. Those costs are usually a wash for kitchens and bathrooms.

Do the renovations and upgrades for you and your family not for a possible buyer in the future.

Link to comment
Share on other sites

In old house there are some opportunities for a decent ROI, for example I just replaced my heat pump myself. Total cost was 6000$ including a new electrical entrance (that I could not do). Estimated savings should be about 800 to 1000$ a year because I was initially using oil for heating. Other nice ROI also include windows or insulations in very specific cases.

 

Also, know your strength, if you don't like working with your hands don't do tasks that are technically difficult. Here a list of tasks/difficulties I estimate:

 

Everybody motivated can do it

Paint

Plaster (3cm or less)

Simple electrical (know your electric code first)

Floating floor

Moldings

Changing doors

Roof patch

Chimney cleaning

 

Fairly handy people's can do it

Plumbing

Wooden floor

Ceramic tiles

Windows

Roof Shingles

Dryboard and plaster

New walls

 

Don't try this unless you have patience, skills and tools

Kitchen Cabinet

Cutting down trees more than 30 feet high

 

BeerBaron

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...