Buying A Home
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
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1760s house -- worth it?
Hi all, First post on the boards, although I've been reading and enjoyed hearing all your advice. I wonder if you could help me...My husband and I checked out a 2800 sq. ft. home with an attached barn that was built in the 1760s. It's in a nice small town in the north shore of Boston. It is basically my dream house: tons of charm, period details, unique floor plan, nice town, good schools.It's been on the market for 500 days, and started at $465k, down to $400k at the moment. Our realtor told us when he set the appointment up with the owner (it's FSBO), he said there was room for negotiation, and emphasized this. Owner currently not living in home, and something about a divorce.The rub: It needs a new roof, probably within the next 2-3 years, maybe sooner. All single-paned windows which means expensive heating in the winter, especially with the size of the house. (And prob, eventually replacement.) The clapboard siding needs to be scraped and painted, maybe some replacing. And, when we went into the basement, there was some water. (Not sure yet what it was, but it could be as simple as improper drainage.) Interior needs some updating, but that could wait.I'm hoping that knowing the work that is necessary, we can negotiate a fair price that takes into account the repairs we'd need to do immediately. If we can get it down to $300K-$320K, we'd be able to save enough money every month to make necessary repairs, but things might be tight for a couple of years. I can see myself living there for the next 20-30 years. I feel like it's worth it to put the work in for a place we'd stay in for a long time, especially if we can get the mortgage down. Should I be more worried about the necessary repairs? Am I completely insane to assume the seller might compromise that much on their listing price?I'd appreciate your opinions! (And knowledge about potential costs...)
Re: 1760s house -- worth it?
Wow that is an old house! It seems you are serious about this so I would ask your realtor to get the utility bills from the house (from a winter and summer when the owners lived there). My concerns would be no insulation, old windows, electrical/plumbing and old roof. All of those are expensive fixes!
Also is the house a "historic" property? If so you are going to spend a lot of time and money fighting with the historic society to get your improvements approved an more money than normal on windows/roof/etc.
Make sure you get a great inspector- preferably one who inspects really old homes.
Thanks, Lil_Jen. It's actually not a historic house -- we looked at another one the other day that was built in 1700 and that one wasn't even one. I guess around here someone famous had to live there to qualify?
Realtor asked for utility bills, and also some dates on when the roof went on, when rewiring was done, etc.
I have to assume all other potential buyers are scared away from this house with all the issues. If we can get it at a good enough price, and don't mind the work, does that justify all the money spent fixing it up?
If you're really in love the house but are worried about where the money will come from for renovations, look into Renovation Loans, or FHA 203K loans. These mortgages can provide the money for neccessary renovations if warranted. The bonus, is that they will NEVER loan money above the market value. They require more up front leg work (getting a full inspection, contractor quotes for repairs and more paperwork to provide to the bsnk) but they normally approved work such as updating roofs and windows, mechanical upgrades, etc - repairs that bring up market value. Essentially, before you close you'll know if you're getting yourself into a money pit or not
This is also a good but not well known option financially if the idea of trying to save that much money for repairs seems too far off.
Married My Love on 6/18/2006
BFP#1 10/1/2011. Our perfect little girl, Her heart stopped @ 12w1d. D&E 11/23/11
BFP#2 3/13/12 Weird CP/Possible EP @ 6w0d
BFP#3 5/28/12 CP @ 5w0d
BFP/WTF#4 10/26/12 CP
BFP#5 12/10/12 EDD 8/23/2013
Chasing a Rainbow: The Chart/The Fruit
All houses eventually need a new roof -- that shouldn't make this a non-starter. See how many layers of shingles are on, and plan on doing a full tear-off when you re-roof, rather than slapping on another layer.
If the windows are original, DO NOT REPLACE THEM. Repair them where necessary and install wood-framed storm windows. Ask your power company about an energy audit; you'll probably find out you're losing more heat through a lack of attic insulation.
What does the breaker/fuse box look like? If it has fuses, the wiring probably hasn't been updated since it was first installed 80-100 years ago and you won't be able to have an electric dryer. If it is breakers, see if you have at least 200 amps. If so, it may have fairly modern electric.
Before you do anything to the house, research restoration techniques and talk to the local historical society. They'll have good information and maybe a list of contractors and tradespeople who specialize in old homes.
Above all, get a good, thorough home inspection done by an inspector who understands old houses.
It sounds like you've found a treasure and have the opportunity to increase its value substantially. If you don't mind having a third party in your marriage (the house), go for it! If it is truly a distress situation, you might get it for your price. Can't hurt to ask!
Thanks, Tootsie. It does have 200 amps and reasonably updated electric, which is good.
I'm not too worried about doing a roof, just doing it immediately. I'm glad Katharine brought up FHA 203K loans -- I was wondering if there were options like that, since our main problem is having cash left over after closing.
I believe there are already storm windows. Our realtor said the same thing you did -- he replaced all windows on an old home, and it didn't help his heating costs that much.
Thanks for your advice. I'll definitely check out the historical society and read some books before doing anything...if we buy the house!
There are 2 types of 203k's - one is a short type that allows up to a certain $amount (I think it's $35k??) and more involved that are "unlimited" (up to market value), I did the long form, not FHA (we out down 20% to avoid all the FHA additional interests they tack on on all FHA's) but esentily the same thing. It's not easy and construction itself is a stressful process, but it's an amazing loan option.for the diamond In the rough house. Google 203k and you should find the basic info.
In regards to heating loss, if you pursue this house, make sure you look at/ask about insulation- that's the hidden heat killer. Updated electrical is a good sign! And as the PP said, make sure you restore and not remodel - that is the beauty of any old home.
Married My Love on 6/18/2006
BFP#1 10/1/2011. Our perfect little girl, Her heart stopped @ 12w1d. D&E 11/23/11
BFP#2 3/13/12 Weird CP/Possible EP @ 6w0d
BFP#3 5/28/12 CP @ 5w0d
BFP/WTF#4 10/26/12 CP
BFP#5 12/10/12 EDD 8/23/2013
Chasing a Rainbow: The Chart/The Fruit
You'll never know if you don't try!
I don't expect that the seller will be willing to offer credits for everything and you'll want to be selective in what or how much you ask for. Research the comps: is it priced well based on its condition? When I do my research, the condition is certainly a major condition in determining a price. So, if it is priced well for the condition, there may be less room for negotiations. That being said, it may be worth a try: often sellers can't afford to pay out of pocket for repairs but there may be ways to arrange a credit that the seller would agree to and he doesn't have to pay out of pocket. Anyways, give it a try.
Also, a home of this type will not be for every buyer, adding to the days on market. Many buyers wouldn't be willing to take on a home that is 250 years old (so cool!!!). It will require a higher level of attention than a newer home and you can't make repairs 'blindly'. The home requires an owner who will love it and take the time to make conscientious repairs. Sounds like you may be that person
It's not your typical property, do you research and make an offer. It may just work out. And, by the way, I am totally jealous! Sounds so cool!
Good luck and have fun!
Lighthouse State Beach, Santa Cruz.
Lighthouse State Beach, Santa Cruz.
Honestly this sounds like more of a personal decision than a financial one. There is the potential of much stress to add to your relationship (family?) that would not be worth it IMO. We love the charm of old houses too, but we also do not want to invest most of our income/energy into one house. The thought of renovating with a baby/toddler/children would also be a factor for me.
Having said that, it is for some people. And if you are one of those people that enjoys spending your time/weekends/money on a house, then you should seriously consider it. I have coworkers/friends that actually love doing this!
I work in the historic house field. If you want to preserve those repairs to look authentic it can be very costly but worth the dedication. I suggest contacting a preservation contractor or firm to have a better understanding of the cost. Also does this house have specific obligations to a historic preservation either city or state. Every time you do something to the outside would require you to submit paperwork and plans o a council.
car_ramrod: It's not that we'd have no money, it's just that after closing our cash reserves (other than our emergency fund) would be tapped out. If we bought this knowing we'd have to put a lot of $$ into it, we'd probably reserve money we'd have otherwise put into down payment. The seller has also said they'd put money in an escrow account for repairs, which we could negotiate.
We'd still be able to save money every month, just not as quickly as we can now as renters. My definition of "tight" is only being able to save $1000 a month, while still contributing to 401(k), allowing a decent budget for clothes and food, etc. We're also both in our 20's and have a lot of room for our salaries to grow.
Is that unreasonable? I am trying to be realistic about costs.
As a lover of old homes, it would be worth it to me if you can negotiate a fair price that takes into consideration the things that need to be replaced right away.
We had, until 18 minutes ago when we had to revoke (see above post), a contract to buy an 1890 Queen Anne Victorian. We got estimates to insulate and paint because we knew those would be the two things we would need to do the first year. After the inspection, some of the other things that came up: sewer line damage, minor leaks in the new roof, minor plumbing, whether or not to decommission the underground oil tank, were things we asked that they replace or provide an allowance for since we knew how much we would need to spend on insulation and paint.
But like you we knew this could be our forever house. Old houses are becoming fewer and farther between. As long as you know and are prepared for the maintenance required in being the house's new caretaker, I would move forward.
north shore of boston here.
watch out, I don't know what town this is, but in my town, the historical commission is NOTORIOUS for sending out random "congratulations! you're a historic home!" letters to people which basically backs them into a corner with regards to making ANY changes. they have to go through hell to get even the simplest things approved at that point. and god help you if you don't wait the required amount of time berfore proceeding - they put you on the permit blacklist and you can't pull any permits for 2 years.
I don't want to scare you but this is the extreme side of things, so even if your house doesn't have a cornerboard that says "Birthplace of Nathan hale" or whatever, you may still be declared historic by virtue of the house's age.
welcome to new england right;)