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Mapping homes you can buy from the US government for <$100k

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Re: Mapping homes you can buy from the US government for <$100k

#101

Post by dumbmrblah »

jagged-chisel wrote: post #93
BizarroLand wrote: post #88

Earlier quoted context omitted.

in 2012 I had a chance to buy a duplex in a relatively desirable neighborhood for $25k. It needed about $25k in rehab, but $50k in that area was unheard of. My (now ex) wife was against buying it because we had not bought a home for ourselves yet, and even trying to explain that we could buy it, live in one side, rent the other for the full cost of the mortgage and then some was not enough to convince her, so I let i…

> ... I probably would have bought it anyway ... Maybe the restoration would have been a (or another) point of friction, and perhaps the project would not have gone well because of it. You could have sold for breakeven, or less. Then you (and/or she) would have blamed that as the reason things went south. Or it could have gone well and you could have lost your share in a divorce. I don't really have a point ... maybe…

A wise man once told me that most relationships can survive two affairs or one house remodel.

Re: Mapping homes you can buy from the US government for <$100k

#102

Post by AnthonyMouse »

coryrc wrote: post #99
AnthonyMouse wrote: post #90

Earlier quoted context omitted.

The assumption for a couple of generations has been that housing costs will always increase over time as a percent of wages. The problem with that is that it's unsustainable. The next generation has to be able to afford it in order to buy it, and they also need to buy food and utilities etc., which also cost more when real estate does. Investors can't save you either when the next generation can't afford the rent the…

Nothing you said is wrong, but you could say that in 2013 too, and in that time apparently prices have nearly doubled and you missed out if you didn't take advantage. Mortgages are "heads I win, tails you lose" in non-recourse states like California. You're not down more than your down payment, but the upside is huge, and for the past fifty years it has been more financially advantageous to use that leverage to buy t…

> Nothing you said is wrong, but you could say that in 2013 too, and in that time apparently prices have nearly doubled and you missed out if you didn't take advantage.

In 2013 you couldn't say that prices have nearly doubled since 2013 under ZIRP, which is the argument that buying now would be buying high.

> Mortgages are "heads I win, tails you lose" in non-recourse states like California. You're not down more than your down payment, but the upside is huge, and for the past fifty years it has been more financially advantageous to use that leverage to buy the most expensive home they will allow you to.

You're not down more than your down payment plus whatever principal and interest you've paid since then.

On top of that, it's still leverage. Suppose you buy a $1M house with a $200k down payment and ~$5000/mo going to principal and interest. In five years you've paid out the $200k down payment, another ~$50k in principal and ~$250k in interest. If the value at that point declines by 25% since you bought, you're not down 25%, you're wiped out, -$500k, because you're left with a $750k house where you still owe $750k having already paid $500k. Let's say it's only -$380k because you'd have had to pay $2000/month to rent a smaller apartment in the alternative.

Whereas if you put the $380k into non-leveraged investments and the market declined by 25%, you'd still have $285k instead of $0. If the overall market does better than housing or it was "safe" investments like CDs then you'd still have the entire $380k plus whatever interest it earned. Worse yet, if housing costs declined then your monthly rent would go down but your mortgage is fixed for 30 years.

You could still make the argument that it's worth it to take the leverage if the upside is expected to be large, i.e. you expect the value to keep going up, but suppose you don't.

Re: Mapping homes you can buy from the US government for <$100k

#103

Post by [deleted] »

ryandrake wrote: post #67
gensym wrote: post #31

Earlier quoted context omitted.

Also, IME, places with no employers tend to be populated primarily by addicts, disability fraudsters, and other criminals.

...or the elderly, retired, legitimately disabled, or just people temporarily down on their luck.

[deleted]

Re: Mapping homes you can buy from the US government for <$100k

#104

Post by ButlerianJihad »

AnthonyMouse wrote: post #95
ButlerianJihad wrote: post #69

The crazy thing about residential property in 21st-century USA is that it's always a money pit. A few hundred years ago, it was commonplace for the middle- and upper-classes to own large estates, and these estates were expected to be assets that earn money. You would hire staff, and tenant farmers, or have slaves or whatever cadres of workers to work the land, be shepherds, and basically produce revenue for the lords…

> There are people fighting their HOA, tooth and nail, because the HOA is enforcing their rules about signage, or giveaways, or something, and these people are even featured on the evening news and portrayed as "innocent HOA victim" when in fact, they're trying to illicitly run a business out of their garage and gin-up foot traffic for that business from passers-by in a SFH residential-zoned neighborhood. Isn't this…

An HOA is, by definition, your ordinary neighbors. And by the principles of “small government” and subsidiarity, the HOA is tasked with establishing rules and guidelines that help make good neighbors live in harmony, such as uniform aesthetics, prohibited activities, and so forth. These rules are otherwise handled by landlords or municipal codes.

It is really about conformity and keeping the peace, so that the Clark Griswolds and Gladys Kravitzes of the world cannot run roughshod over the others.

Mixed-use zoning is perfectly cromulent, but I am not referring to mixed-usedl zoning. These are large SFH residences with ample lots in suburban developments.

This sort of entrepreneurship is fine if you’re a web designer, or traveling electrician, but many times they instead flout all kinds of boundaries such as carrying the proper business licenses, parking/disabled accessibility, insurance, signage etc.

Americans in suburban and residential areas have a certain expectation that their neighborhoods should be free of obvious commercial enterprises, because that is why we invented strip malls!

Re: Mapping homes you can buy from the US government for <$100k

#105

Post by dlcarrier »

NitpickLawyer wrote: post #24
cliglot wrote: post #3

[dead]

> With $120,000 owed in back taxes due by you upon purchase. How does it work in the US? Are taxes on the property itself? This feels weird. I would have thought that the property can only be sold if everything is OK with it (no litigation, liens, etc), and taxes are owed by persons? Is it different over there?

It varies by state and sometimes even county. Sometimes you buy the property outright (a deed), sometimes you buy the debt (a lien), so the original owner pays you back with interest but they keep the property unless you foreclose, and sometimes you buy the right to the land if the original owner doesn't pay you back within a set time frame. (a redemption deed)

Here's a general map of how it works, by state: https://www.secretsoftaxlieninvesting.com/tax-sale-map

In general, when it's sold as a deed, and sometimes as a redemption deed, non-government liens on the property are forfeit, and it clears out the taxes owed by the government entity selling it, but it doesn't clear out other government liens, e.g. when a property is sold to pay county property tax, the federal government could have a lien on it for income tax owed by the same owner, and the county could have a lien on it for sidewalk repair, and a mortgage company could have a lien for a loan. The mortgage company would be unable to collect anything, the federal tax lien would likely allow the government to force you to sell it to them for what you paid for it, but they wouldn't be entitled to collect from you, because it's the previous owner who pays taxes, but you could still be required to pay the county lien for sidewalk, plus penalties accrued since the previous owners non payment started, because you now own that property and its sidewalk.

Re: Mapping homes you can buy from the US government for <$100k

#106

Post by Scoundreller »

advisedwang wrote: post #56
someguynamedq wrote: post #35

Earlier quoted context omitted.

123,000 is still very cheap

Did you look at the $3000 house? https://govauctions.app/auction/hud-home-420-e-dayton-st-fli... It needs to be torn down and rebuilt. It's not a large plot. It doesn't seem to be in an attractive location. For all we know the water is undrinkable. I suspect its true value is negative.

Heh, some landowner near me owned a piece of contaminated property. Technically worthless but was getting some lease money for a shop on the property. I think their game plan was for the city to grow and it being valuable to excavate one day for a condo or other building. Soil remediation is a lot cheaper when you dig anyway.

Transit agency tried to expropriate for a train station at market value: ie $0.

Looks like it got settled out of court: https://canliiconnects.org/en/commentaries/88178

Re: Mapping homes you can buy from the US government for <$100k

#107

Post by xyzelement »

sfn42 wrote: post #86
xyzelement wrote: post #46

A few years ago an apartment in my building was up for a foreclosure sale. Price looked good but turned out it was literally impossible to figure out (1) how much or the original dead beat's mortgage i would be on the hook for (2) tax burden and (3) unpaid coop fees i would owe. So even as finance save person already in the building, it was impossible to figure out what I'd be getting/owing. Really ruined my taste fo…

It's crazy how this isn't simple. Surely all they have to do is to tally up the debts secured by the apartment, then sell the apartment and use the money to pay as much of the debts as possible. Any remaining debt is the lender's loss, that's the risk they take when giving out loans. If any debt does need to be tied to the apartment rather than the person, then it simply needs to be registered in a publicly (easily)…

I feel like any statement with "surely all they have to do" is going to miss some nuance.

In this particular case the apartment is owned by the coop (that's how coops work) and the mortgage is for the shares in the coop. So maybe more complex than a basic foreclosure where it might possibly work more like you'd think.

I think the broader point is if real estate is selling well below what is you would expect, there's a reason for that.

Re: Mapping homes you can buy from the US government for <$100k

#108

Post by HeyLaughingBoy »

pwg wrote: post #81
HeyLaughingBoy wrote: post #70

Earlier quoted context omitted.

As an aside, I'm told that Title companies make absolute bank. Most buyers get title insurance, but the insurer very rarely ever has to make a payment.

> Most buyers get title insurance, This is because all lenders require title insurance as a requirement for receiving the loan monies. So for almost all buyers they have no choice, their bank/credit union that is actually putting up most of the money forces it upon them.

Not all buyers are using loans. First house I sold was to someone who refused title insurance because in his words, "that house has been sold 3 times in 10 years, the title's fine."

Re: Mapping homes you can buy from the US government for <$100k

#110

Post by 1-more »

HeyLaughingBoy wrote: post #108
pwg wrote: post #81

Earlier quoted context omitted.

> Most buyers get title insurance, This is because all lenders require title insurance as a requirement for receiving the loan monies. So for almost all buyers they have no choice, their bank/credit union that is actually putting up most of the money forces it upon them.

Not all buyers are using loans. First house I sold was to someone who refused title insurance because in his words, "that house has been sold 3 times in 10 years, the title's fine."

I swear I heard this same story elsewhere online. Maybe it was here in another thread.
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