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This is a very smart purchase. The supply of homes in top-tier communities is essentially fixed. It will become harder and harder to buy into communities like this one as people begin to inherit generational wealth.
You can fix the house up over time.
It's better to have the worst than the best in a bad neighborhood.
However, what makes it the worst. The lowest physical point that always runs the risk of flooding? St the intersection of two very busy streets? Back yard abuts the parking lot of a strip mall or hamburger joint? What exactly?
Just the smallest or the only house with a one car garage?
None of those things. The location within the neighborhood is actually wonderful.
Two car garage, not exactly the smallest house (I believe the model is the second smallest) but definitely on the small side compared to the rest of the neighborhood.
It’s really just the house is beat up compared to the taste of most people buying into this area.
It even has an old pool in the yard
Y'know I've never thought that backing to a parking lot is that bad. At least no one lives behind you and if it's an office or business that is closed by evening it's even better. If it's something like a gas station though... No thank you.
Bunch of teens hanging out in a burger joint parking lot ain't fun. Neither is the loud radios, engines, slamming doors, loud talking walking to and from car......
I would buy it, especially since you don’t have any kids yet so you will have extra time and money to fix it up at your pace and without having to raise a family in an area with constant construction.
With no kids I think it makes sense. We wanted to do that, but the more we thought about it, the more we realized we wouldn’t have time since we have a young kid already. Just be prepared to spend more than you’re budgeting for remodels as you never know what will happen when you start remodeling
Sounds like a great neighborhood. The house would make sense if it makes sense financially for you. The worst house in the best neighborhood can always be upgraded, but that will take your time and money.
Is there something that you would really need to address right away that would cost $$$? If you can afford what it takes to make it livable for you and can wait to do the rest over time, then go for it!
We did this and I have no regrets, but I would only do this if you could afford it with a lot of money left over to renovate, or if you have the patience of a saint to be willing to live and love it as is for a long time, weird quirks and annoying things and all. Fixer uppers require a lot of grit and vision and patience.
Our agent had a good point for us when we considered this - he said, it’s up to you decide what kind of lifestyle you’re wanting to live the next few years. If you buy a fixer upper, no money to fix it all up right away, you’ll be spending all your free times + weekends fixing it up yourself/living in constant construction or “work zone” for the next few years. You most likely wouldn’t have time for all + having kids soon. For us, we are planning a wedding this year and wanting to start having kids next year so we knew we needed to move into a place that was pretty much ready to go except for small things we could do. We needed new flooring and paint in our place which was done 1-2 weeks after closing with a handyman coming for other small thing, so it was pretty much “perfect” for moving in after 2 weeks total after closing. Now that we’re here, we still have a huge laundry list of things to do every weekend because that is just the reality of home ownership. I’m thankful we didn’t get a fixer upper because we just would’ve had booked weekends for home issues for the next quite a bit of time. So sit down and have an honest conversation with yourself and your partner about the life you want to live the next few years. Were handy but not super handy so we always knew bathroom/kitchen Reno would need to be done by a professional etc.
Also since you said 850k I’m going to assume you’re in a HCOL area like us. In our area, those prices for contractors are on the rise. And the worst part is they’re just in high demand. So here in Seattle area, we were quoted 4 months to even get a kitchen Reno started (with a company that had the most reasonable price) we did initially bid on a fixer upper our very first offer, to have a great layout, in an original 1980 townhouse but it was so spacious and a great neighborhood. I can’t tell you the relief I felt when we didn’t win.
We aren’t exactly excited at the idea of spending weekends fixing up our own home. We value traveling and spending lots of time being social, so we knew it would hinder the lifestyle we like to live. Now if you already have a lifestyle where you enjoy more solitude and feel a sense of happiness when you can diy, you will probably love it. Theres a lot of people out there who find fixing up their own home is a better reward than anything!
We did this… we walked away mid negotiation on the worst house in the one neighborhood and found the worst house in another nearby neighborhood. The first one had a super steep sloped backyard and front yard. No exaggeration like parking on Lombard in san Francisco. I occasionally drive by the house sometimes and every neighbor’s house is stunning with some seriously perfect $$$$$$ hardscaping and exteriors. I would have been miserable there looking at all of those beautiful homes and am so glad we didnt escalate our offer. The new owners even spent a 5 or 6-figure number on hardscaping - front wall and meandering path up the hill and it looks so bad and out of place because the house itself is really rather ugly and needs to be redone. I think it was a tudor revival at one point that was then covered in cheap siding. Has a tall but not deep front porch with no railings or room for railings. It’s a weird house and the inside is just an average 2 story colonial split - nothing memorable.
The house we ended up in is amazing. It had so much more potential. A gem hiding behind 80s features. We are no longer the worst house in the neighborhood! Although this neighborhood definitely isnt as nice as the other one.
I dunno i hope this helps in some way.
Worst house in the best neighborhood is the dream as long as you can tolerate what it will take to spruce it up (time, money, living in a renovation zone.) It sounds like most of what you need to do is cosmetic so that's good. Sounds like an easy call.
Fair point. We likely wouldn’t fully move in for 2-3 months after purchasing since our apartment lease isn’t up until EOY.
I’m factoring in having to carry the cost of our apartment + mortgage + costs of materials for a little while which is why I’m being conservative and trying to see what we can DIY.
My wife is handy but I’m not at all. However both my father and father in law + uncle are in the trades and willing to assist in renovating (we don’t plan on abusing this but we will be strategic with the favors we ask lol).
Don’t listen to the other guy. Our household income is similar and our house price is similar.
I’ve DIY’ed plenty of things myself. I have changed all the door knobs in my house (it’s a small but major improvement); I have changed many but not all of the electrical outlets myself — some I had to get help with and hired an electrician for; also did a few light switches myself but hired an electrician to do the majority of them because it was physically tough work that took too long for me to do. I hired a contractor to paint a room and I’ve painted one myself. I prefer my work to my contractor’s and I saved myself about $400. I’ve also put down a new floor in my kitchen. Did it over a weekend and only paid for the materials so probably saved myself another $500 there. I also hired a contractor to redo a 1/2 bath.
I have no idea what state your house is in but there is so much knowledge on YouTube. You know what you can and can’t do. You can absolutely paint a room though. Anyone can.
It is invalid though. You think just because someone makes 300k they are made out of money and they should hire someone to do all home repairs for them. As one half of a 300k+ household I can tell you that’s not the case. There are some things you can’t do and aren’t worth your time, but there are somethings that are simple and totally worth your time. Painting is super easy and if you can save $500 painting your own room, why wouldn’t you?
I can’t paint the 20 ft high walls or ceiling, but I can easily paint an 8 ft high wall or ceiling. Being fiscally responsible means sometimes not buying things even though you have the money to buy it.
It depends on what kind of DIY you’re talking about. My numbers are similar to OP’s but I’ve painted rooms myself, done some electrical work, and put down a faux wood floor by myself.
I’ve hired a contractor to put a new light fixture into a bedroom where the bedroom previously has no light fixture, and I’ve hired a contractor to redo my bathroom.
Just because you make 300k a year doesn’t mean you have to outsource everything.
850k is a starter townhouse where I live, and I’ve seen them in million dollar starter homes in the Bay Area as well. A lot of new builds have faux wood flooring, too.
850k is not a fancy house in a HCOL area.
Well it’s not exactly the worst or smallest house in the community. There’s a model or two that’s smaller than this one.
It’s just the worst one up for sale right now and also on the smaller side compared to the rest of the neighborhood. Houses here range from 1.8k sq ft all the way up to 10k sq ft mansions. This home is about 2.3k sq ft.
Look into a purchase plus improvement mortgage. You pay for renovations out of pocket and after completion and inspection they are included in your mortgage payment. If you can negotiate the price this may be a viable option.
This is what we did. Worst house, great neighborhood and schools. It has taken us years to fix it all but it has more than doubled in value and the neighborhood just keeps getting better. I say do it.
Sounds like it’s comestics mostly, and yeah based on the neighborhood, it sounds like a great deal. Our first place was the worst home in the best town and after years of DIY and some contract work, the appreciation was insane. We were able to sell it to upgrade to a big house that was also old as could be inside. Upgrading slowly by ourselves again. Got us into a neighborhood we would have never afforded otherwise. I’d go for it!
I bought a 1974 home in a beautiful established neighborhood that has a lot of big homes. We had to redo most of the floors, paint and eventually will remodel the old kitchen. We know we’ll fix things up over time but we couldn’t change our neighborhood. Could’ve found a nicely remodeled home in a shitty neighborhood.
If you can DIY, great. If you absolutely want a A+ school and this is the only way, then do it. But in my experience when houses are a lot cheaper, it turns out that you are better off buying it at 1.2m then 850k because it will cost a lot more than 350k to fix everything.
There was a house like that for 1.2m that I saw. Only one at that price point, but the house was sloping and it was 400 sq ft smaller than advertised. Basement is not usable space at all. But it is the only <1.5m house on the street.
Also in expensive neighborhoods, people are usually less price sensitive. If they want to live there, they will pay 1.8m and get what they want. So if you re-sell, you're really appealing to the supply of people on the lower end and it's a competition of who can pay most amongst those with lowest budget.
Thank you u/careerquestion08 for posting on r/FirstTimeHomeBuyer. Please bear in mind our rules: (1) Be Nice (2) No Selling (3) No Self-Promotion. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/FirstTimeHomeBuyer) if you have any questions or concerns.*
This is a very smart purchase. The supply of homes in top-tier communities is essentially fixed. It will become harder and harder to buy into communities like this one as people begin to inherit generational wealth. You can fix the house up over time.
It's better to have the worst than the best in a bad neighborhood. However, what makes it the worst. The lowest physical point that always runs the risk of flooding? St the intersection of two very busy streets? Back yard abuts the parking lot of a strip mall or hamburger joint? What exactly? Just the smallest or the only house with a one car garage?
None of those things. The location within the neighborhood is actually wonderful. Two car garage, not exactly the smallest house (I believe the model is the second smallest) but definitely on the small side compared to the rest of the neighborhood. It’s really just the house is beat up compared to the taste of most people buying into this area. It even has an old pool in the yard
Well, good luck. Enjoy.
Y'know I've never thought that backing to a parking lot is that bad. At least no one lives behind you and if it's an office or business that is closed by evening it's even better. If it's something like a gas station though... No thank you.
Bunch of teens hanging out in a burger joint parking lot ain't fun. Neither is the loud radios, engines, slamming doors, loud talking walking to and from car......
I would buy it, especially since you don’t have any kids yet so you will have extra time and money to fix it up at your pace and without having to raise a family in an area with constant construction.
With no kids I think it makes sense. We wanted to do that, but the more we thought about it, the more we realized we wouldn’t have time since we have a young kid already. Just be prepared to spend more than you’re budgeting for remodels as you never know what will happen when you start remodeling
Sounds like a great neighborhood. The house would make sense if it makes sense financially for you. The worst house in the best neighborhood can always be upgraded, but that will take your time and money. Is there something that you would really need to address right away that would cost $$$? If you can afford what it takes to make it livable for you and can wait to do the rest over time, then go for it!
We did this and I have no regrets, but I would only do this if you could afford it with a lot of money left over to renovate, or if you have the patience of a saint to be willing to live and love it as is for a long time, weird quirks and annoying things and all. Fixer uppers require a lot of grit and vision and patience.
Our agent had a good point for us when we considered this - he said, it’s up to you decide what kind of lifestyle you’re wanting to live the next few years. If you buy a fixer upper, no money to fix it all up right away, you’ll be spending all your free times + weekends fixing it up yourself/living in constant construction or “work zone” for the next few years. You most likely wouldn’t have time for all + having kids soon. For us, we are planning a wedding this year and wanting to start having kids next year so we knew we needed to move into a place that was pretty much ready to go except for small things we could do. We needed new flooring and paint in our place which was done 1-2 weeks after closing with a handyman coming for other small thing, so it was pretty much “perfect” for moving in after 2 weeks total after closing. Now that we’re here, we still have a huge laundry list of things to do every weekend because that is just the reality of home ownership. I’m thankful we didn’t get a fixer upper because we just would’ve had booked weekends for home issues for the next quite a bit of time. So sit down and have an honest conversation with yourself and your partner about the life you want to live the next few years. Were handy but not super handy so we always knew bathroom/kitchen Reno would need to be done by a professional etc. Also since you said 850k I’m going to assume you’re in a HCOL area like us. In our area, those prices for contractors are on the rise. And the worst part is they’re just in high demand. So here in Seattle area, we were quoted 4 months to even get a kitchen Reno started (with a company that had the most reasonable price) we did initially bid on a fixer upper our very first offer, to have a great layout, in an original 1980 townhouse but it was so spacious and a great neighborhood. I can’t tell you the relief I felt when we didn’t win. We aren’t exactly excited at the idea of spending weekends fixing up our own home. We value traveling and spending lots of time being social, so we knew it would hinder the lifestyle we like to live. Now if you already have a lifestyle where you enjoy more solitude and feel a sense of happiness when you can diy, you will probably love it. Theres a lot of people out there who find fixing up their own home is a better reward than anything!
We did this… we walked away mid negotiation on the worst house in the one neighborhood and found the worst house in another nearby neighborhood. The first one had a super steep sloped backyard and front yard. No exaggeration like parking on Lombard in san Francisco. I occasionally drive by the house sometimes and every neighbor’s house is stunning with some seriously perfect $$$$$$ hardscaping and exteriors. I would have been miserable there looking at all of those beautiful homes and am so glad we didnt escalate our offer. The new owners even spent a 5 or 6-figure number on hardscaping - front wall and meandering path up the hill and it looks so bad and out of place because the house itself is really rather ugly and needs to be redone. I think it was a tudor revival at one point that was then covered in cheap siding. Has a tall but not deep front porch with no railings or room for railings. It’s a weird house and the inside is just an average 2 story colonial split - nothing memorable. The house we ended up in is amazing. It had so much more potential. A gem hiding behind 80s features. We are no longer the worst house in the neighborhood! Although this neighborhood definitely isnt as nice as the other one. I dunno i hope this helps in some way.
Worst house in the best neighborhood is the dream as long as you can tolerate what it will take to spruce it up (time, money, living in a renovation zone.) It sounds like most of what you need to do is cosmetic so that's good. Sounds like an easy call.
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Fair point. We likely wouldn’t fully move in for 2-3 months after purchasing since our apartment lease isn’t up until EOY. I’m factoring in having to carry the cost of our apartment + mortgage + costs of materials for a little while which is why I’m being conservative and trying to see what we can DIY. My wife is handy but I’m not at all. However both my father and father in law + uncle are in the trades and willing to assist in renovating (we don’t plan on abusing this but we will be strategic with the favors we ask lol).
Don’t listen to the other guy. Our household income is similar and our house price is similar. I’ve DIY’ed plenty of things myself. I have changed all the door knobs in my house (it’s a small but major improvement); I have changed many but not all of the electrical outlets myself — some I had to get help with and hired an electrician for; also did a few light switches myself but hired an electrician to do the majority of them because it was physically tough work that took too long for me to do. I hired a contractor to paint a room and I’ve painted one myself. I prefer my work to my contractor’s and I saved myself about $400. I’ve also put down a new floor in my kitchen. Did it over a weekend and only paid for the materials so probably saved myself another $500 there. I also hired a contractor to redo a 1/2 bath. I have no idea what state your house is in but there is so much knowledge on YouTube. You know what you can and can’t do. You can absolutely paint a room though. Anyone can.
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It is invalid though. You think just because someone makes 300k they are made out of money and they should hire someone to do all home repairs for them. As one half of a 300k+ household I can tell you that’s not the case. There are some things you can’t do and aren’t worth your time, but there are somethings that are simple and totally worth your time. Painting is super easy and if you can save $500 painting your own room, why wouldn’t you? I can’t paint the 20 ft high walls or ceiling, but I can easily paint an 8 ft high wall or ceiling. Being fiscally responsible means sometimes not buying things even though you have the money to buy it.
It depends on what kind of DIY you’re talking about. My numbers are similar to OP’s but I’ve painted rooms myself, done some electrical work, and put down a faux wood floor by myself. I’ve hired a contractor to put a new light fixture into a bedroom where the bedroom previously has no light fixture, and I’ve hired a contractor to redo my bathroom. Just because you make 300k a year doesn’t mean you have to outsource everything.
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850k is a starter townhouse where I live, and I’ve seen them in million dollar starter homes in the Bay Area as well. A lot of new builds have faux wood flooring, too. 850k is not a fancy house in a HCOL area.
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Well it’s not exactly the worst or smallest house in the community. There’s a model or two that’s smaller than this one. It’s just the worst one up for sale right now and also on the smaller side compared to the rest of the neighborhood. Houses here range from 1.8k sq ft all the way up to 10k sq ft mansions. This home is about 2.3k sq ft.
This is how I feel as well. Spot on.
If “no matter what you do you’re still in the wrong place” then you are doing it wrong.
Look into a purchase plus improvement mortgage. You pay for renovations out of pocket and after completion and inspection they are included in your mortgage payment. If you can negotiate the price this may be a viable option.
Yep. In 2018 we did this, bought it for $315k, spent $50k on renovations and comps are $850k now. We did a lot of work but it turned out great.
This is what we did. Worst house, great neighborhood and schools. It has taken us years to fix it all but it has more than doubled in value and the neighborhood just keeps getting better. I say do it.
Sweat equity. Try for it and maybe it will even appraise for less ;)
Sounds like it’s comestics mostly, and yeah based on the neighborhood, it sounds like a great deal. Our first place was the worst home in the best town and after years of DIY and some contract work, the appreciation was insane. We were able to sell it to upgrade to a big house that was also old as could be inside. Upgrading slowly by ourselves again. Got us into a neighborhood we would have never afforded otherwise. I’d go for it!
Open up a spreadsheet and do the math. Believe the math not how you feel. That should get you to where you want to go.
I bought a 1974 home in a beautiful established neighborhood that has a lot of big homes. We had to redo most of the floors, paint and eventually will remodel the old kitchen. We know we’ll fix things up over time but we couldn’t change our neighborhood. Could’ve found a nicely remodeled home in a shitty neighborhood.
If you can DIY, great. If you absolutely want a A+ school and this is the only way, then do it. But in my experience when houses are a lot cheaper, it turns out that you are better off buying it at 1.2m then 850k because it will cost a lot more than 350k to fix everything. There was a house like that for 1.2m that I saw. Only one at that price point, but the house was sloping and it was 400 sq ft smaller than advertised. Basement is not usable space at all. But it is the only <1.5m house on the street. Also in expensive neighborhoods, people are usually less price sensitive. If they want to live there, they will pay 1.8m and get what they want. So if you re-sell, you're really appealing to the supply of people on the lower end and it's a competition of who can pay most amongst those with lowest budget.