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What would you do?
We have 2 houses that we like but they are both very different. Any and all thoughts welcome.
House 1- 2002 home, right next to my school. Had 1 owner and hasn't had too much done to it since it is new. 4 bedroom 3 bath. It is located right door to my work. It is not in the floodzone so we do qualify for a USDA rural loan on it. Concens is that it does lack character, and has a small kitchen. Also H is worried it is a bit much upfront with little extra. It is 185,000.
House 2-1970s house. It is located in the flood zone, we would do not qualify for the USDA loan, but we could do FHA. We would have to pay flood insurance every year (about 1,200/yr). It has more character than the other one, but would need work on the kitchen and bathrooms. They are functional and we could upgrade as we go. We are willing to do some work but would mainly have to hire out. It is 4 bedroom and 2 bathroom. It is about 7 blocks from my work. concerns-resell value since it is in a flood zone, and uncovering more problems once we start construction. It is 130,000.
Thoughts?
Re: What would you do?
We've owned 5 homes, both old and new. The biggest thing about an older home is how "used" it is. By that, I mean, have the current owners "used up" the house and they're selling you a shell that needs completely new guts? Does it need new HVAC, new roof, new hot water, new baths, new floors, new windows? Or has the home been continually updated and maintained over the years so there's little you need to worry about? Look at the ratio of original to replaced - a new roof when everything else is worn out really won't get you far. Most major house parts have a 25-35 year lifespan - so a house built in the '70s should have completely new guts - if it doesn't, run away if you don't have $20-40k sitting liquid in the bank right this minute.
There's very little on this planet more annoying than every time you turn around finding something's broken in your home. It will eat up all your discretionary cash in the blink of an eye. (Check the link in my siggy for dollar amounts.) For that reason, we vastly prefer newer homes. It's possible to find older homes that are well cared for, but the majority of America just doesn't do what they should and will happily pass off problems to the next owner.
You can add character - the internet is full of ideas.
The math here seems pretty simple to me too. At 4% interest, House 1 is $883 per month and House 2 is $620. But with the flood insurance, House 2 is really $720. For $150 more per month, you get a house that doesn't need much from you.
My Pinterest
The Googlesites Paint Bio
Thinking of doing cosmetic updates to a dated home? These were our costs.
But it did flood. It can again.
I'd go with the non-flood zone home (resale, peace of mind, less costly for insurance, etc.). Add your own character along the way.