Saturday, April 10, 2010

Friends Don't Let Friends Get Screwed by the Real Estate Market

Dear Friends,

I'm trying to buy a house here in the Baltimore City. I've been shopping here for over a year and since I'm new to Baltimore, and new to the house buying process, I'm really confused... I need advice and it occurs to me that many of my facebook friends have some good advice for me about Baltimore real estate, Maryland real estate, and home buying in general.

Most of what I'm looking at are small, older houses (or row houses). All of them need a bit of work, nothing is great. All homes I'm looking at are at least 60 years old. My budget is about $200k (would prefer to pay less) and so many places need so much work that when I tour a house I see tens of thousands of dollars, if not a hundred or more, in remodeling & repair work needed. It's a bit insane.

The only homes that have been selling over the past year have been either "very nice" homes or "bargain priced" fixer-upper homes. But 98% of the homes listed are neither that nice, or that much of a bargain.

What's Confusing?
From all the research I've done about the Baltimore market, I think prices here are still too high. I think that house prices should be at or below 2004 levels. (note: I don't think this is necessarily true for other markets). But *everything* I'm seeing is not priced below 2004 levels... Unless you're some kind of insider... I keep hearing about "private transactions" which are about 25% less than comparable listed houses. And then there are the auction houses which are selling for %40-%60 below current comparables.

Furthermore, Baltimore City has a tremendous OVERSUPPLY of houses. There are potentially over a thousand homes I could be considering. So why do they seem so expensive? Additionally, the city will announce plans to deal with the 30,000 (yes thirty thousand) abandoned homes homes here.

Questions...

- Is the Baltimore market at it's bottom? Can it even go any lower?
- Maybe I should rule out Baltimore City altogether? Maybe Baltimore will slip backwards?
- Do any of my Baltimore friends have any advice on neighborhoods I should consider? Which ones I should be avoiding?
- Why can't I just make a lowball offer on something? (see below)
(My agent is not giving me clear advice on any of the above questions, especially the lowball question. She always says, "it depends on each seller's situation"  when what I really want to hear is "I think you can get away with THIS offer for this particular house". And she keeps mentioning how she is "really busy", I think she's sick of me.) 

I just want a decent, affordable home with a manageable mortgage, where I can be happy. I can not afford to overpay or fix problems. I need your advice.

Thanks,
Steph

1 comment:

  1. I would find a real estate agent that will make as many offers as it takes at 50% off asking price or run a classafued ad want to buy a (what ever Baltimore are) with minor repairs needed can paycash, will look at all 20 days to settlement

    find a lender that will have you approved with a commitment letter subject for the house to appraisal value

    when we run that typy off ad our phone rings

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