How did you go about home ownership in NJ?

Submitted by sufinomo t3_107tq57 in newjersey

I thought looking for smaller homes could make it easier, but even these tiny homes be costing about 300-450k. That seems like a lot for a small old home that will probably have some issues. I dont earn much but I do save alot, so maybe I can get there eventually.

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What did you guys do?

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Hrekires t1_j3ou974 wrote

  1. Became a dual-income, no kids couple
  2. Gave up my apartment in the city to move into a relatively inexpensive apartment in Jersey together
  3. No vacations and limited luxury spending for a couple years while saving as much as we could
  4. Set our budget at something we'd be able to afford on a single income so that we wouldn't be in dire straights if one of us lost our job, took a paycut, or decided to become a stay-at-home parent someday (our happy-medium was 60-70 year-old houses in middle class towns that were move-in ready but dated)
  5. Looked at houses in towns we wanted to move to in order to figure out where we could find something that met our needs and was in our price range
  6. Made sure we had enough saved for a 3.5% down payment, closing costs, and moving expenses
  7. Found a real estate agent
  8. Got preapproved by a bank
  9. Started looking at houses and putting in offers
  10. Eventually had an offer get accepted and not fall apart during the legal review or home inspection periods
  11. Closed on the house and became a homeowner
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stickman07738 t1_j3qiyrb wrote

Excellent list, I would add -

Develop criteria for what you want in a home so that you can give your realtor specific instruction as some realtors will try to over sell you. Besides the number of bedrooms, baths, location - what are other items are must have!

For me they were as follows:

  • No major fix up as I am handy but not skilled enough to do it myself
  • Good school district - easier to sell as you will resell it
  • No double yellow-line - indicates high traffic area- tougher to resell
  • No corner property
  • No sump pump or drainage issue (This one is tough but doable as you will need to look at history of the area)
  • No HOA

PS: I personally would also save more than the 3.5% down payments, as you will need to furnishings, paint, minor repairs... I saved 20% to avoid the PMI (how - no vacations, took lunch to work, only ate out 1-3x per year (birthday, anniversary).

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nicehuman16 t1_j3sb5f1 wrote

I also have the “no yellow lines” criteria. I fell for it on my first house.

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nicehuman16 t1_j3sb7df wrote

I also have the “no yellow lines” criteria. I fell for it on my first house.

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Hrekires t1_j3r1yp7 wrote

I know you can't predict the market, but buying with a 3.5% down payment and paying PMI for a couple years rather than waiting until we'd saved up 20% was probably the smartest thing we did. It's a pretty massive difference when you're looking at ~$400k houses and not one that could have been made up for in a few years by brown bagging lunch to work.

We bought in 2018 and then refinanced to get rid of PMI when prices peaked in 2020... if we'd stayed in our apartment and kept saving money, I literally wouldn't be able to afford to buy the house I'm living in today.

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defalt86 t1_j3ojrl8 wrote

I took a 15 week course on responsible home ownership, and the county gave me 10k.

I then bought a condo for 65k in 2012 using that money as the down payment.

I sold the condo for 95k in 2019 and used the profits for the down-payment on a larger single family home.

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BacktotheFutureTmw t1_j3of694 wrote

Relocated to a cheaper area of the state. I'm from Bergen County...still annoyed I had to do so, but there was no way in hell I was ever going to pay half a million for a rehab job.

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MotorboatingSofaB t1_j3p3iqp wrote

We skipped our honeymoon and took our wedding money for a down payment in 2015 on a nice cape cod in fair lawn for 400. We sold in spring 2021 and found a FSBO in a town we loved very under valued (100k under). We really lucked out and we know it.

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_peachycactus t1_j3qmz55 wrote

Same! Skipped the honeymoon for a home instead and don’t regret a thing.

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Unusual-Okra9251 t1_j3qtk2l wrote

I didn't buy in North Jersey. Also having two incomes, no kids, and no debt is a solid way to go about it.

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Capable_Elk_3070 t1_j3p9g7w wrote

Bought a bankruptcy property with a renovation mortgage, and moved to a more affordable part of the state than the one we were renting in. We don't have kids, so we also made sure not to move to a town that is known for its great schools, since that makes homes more expensive.

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RivChk t1_j3qi1c1 wrote

Bought the smallest, crappiest, ugliest little cheap piece of shit house in a gorgeous beach town. Spent 6 years slowly renovating it until it was a sweet little gem. Sold it in year 7 and was able to use the proceeds for other home.

Also, dual income no kids.

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sufinomo OP t1_j3r03r2 wrote

Is there a reason why beach houses are so cheap?

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RivChk t1_j3r9io2 wrote

This one was a cabin that was never winterized. That’s why it was so cheap.

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dickprompt t1_j3qnkvj wrote

I got a house with this one easy trick…I bought before Covid inflation and inventory. In all honesty tho I am sorry many are in this situation, you are right the prices for those smaller older homes are not worth it. If you aren’t tied down by a family or job I think relocation is the way.

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kittyglitther t1_j3oxnbu wrote

<600sqft condo in an undesirable-ish part of jersey city.

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vc1914 t1_j3qx2nz wrote

Dave Ramsey helps… you won’t like to hear what he says at first but if you follow what he says it works…. Rice and beans baby!

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sufinomo OP t1_j3r09gv wrote

What does he say about housing

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vc1914 t1_j3sbzkw wrote

Well basically it’s first pay off all debt. To buy a house he wants you to do it on a 15 year fixed and the monthly should be less than I think it was 25% of your take home pay. There’s a lot more in between what I’m saying so go check him out. You don’t need to pay for his programs or books. Just watch or listen to his YouTube and podcasts

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imasaltedpretzel t1_j3rbhsi wrote

Bought a three family by the beach after Sandy hit when everyone was scared. It’s a tough time to buy right now AND a tough time to rent. It sucks but I would wait it out. Housing is sticky - interest rate increases are not yet reflected in pricing. The fed has said that their goal is to cool the housing market so it would be prudent to wait if at all possible. I make decent money and I have no idea how people are affording these $3-4k monthly starter house mortgages while raising children. Something has to give.

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sufinomo OP t1_j3rtaez wrote

Yeah I see a lot of cheap beach houses. Hurricanes and higher sea levels are probably the main factor in this.

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bigDogNJ23 t1_j4bxcvc wrote

Whatever you do make sure you account for ongoing maintenance costs. Getting the money to buy the home and pay the mortgage/taxes/insurance is just the first step - you need the money to also pay for things like furniture, cleaning, landscaping maintenance (even if you do it yourself the equipment costs money) never ending repairs, etc. seriously I’ve owned two homes, one built in the 1950s and one built in 1997. In both cases there was always something going wrong that costs $1000+ to address. Like we rarely go a few months without a plumbing emergency, a leak in the roof, an appliance break down, a tree falling, and on and on. It honestly sucks but it beats paying rent (I think). At least we’re building equity. But seriously the upkeep costs are pretty shocking. We bought our first house thinking we’d save money to do some renovations but the upkeep just kept taking up whatever savings we’d manage to build. So we flipped that after a decade and used the equity to buy the newer house but the cycle just continues.

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prayersforrain t1_j3oee4m wrote

I bought in 2009 after that bubble burst and used an FHA backed loan and only put 3% down plus the fed gov gave us a $8000 new homebuyers credit.

All of that said I’ve been in the same condo since then and I mostly hate it but we aren’t moving because my husband and I are in our early 40s and just honestly think our next move is renovating here and in the next 20 years MAYBE we can retire and we’ll sell then. Not interested in being saddled with a $400k at 6% for a three bedroom ranch or cape cod and unfortunately given where both our jobs are we’re in an expensive part of central Jersey.

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sufinomo OP t1_j3oesob wrote

Yeah I been looking at Condos, my main issue is that I kind of dont want to worry about condo fees and neigbors.

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SquirrelEnthusiast t1_j3ovrgo wrote

You're going to have to worry about neighbors no matter what, just because you don't share a wall doesn't mean they can't make your life hell. Buy some acres or you're doomed

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op00to t1_j3w8z63 wrote

lol i bought in 2008, but i had to pay back my 8k. if we had waited until 2009, it would have been free money. still a bit sore about it.

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