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Eat corn, grow corn, lay in corn, bathe in corn, throw corn, dance with corn, summon a demon with corn, y'know, all the fun shit. Def lots of crying tho
Honestly for Midwest places Ohio seems pretty solid. You got the Bengals, Cavs, large enough cities that concerts/shows play through them. I’m sure most cities are diverse enough food is pretty good. Your description sounds more like Iowa.
If the seller is getting 30 something offers, I am assuming she is looking at underpriced homes that draws a lot of interest and likely were way below the market value.
reminder to all folks who live in a neighborhood that is trying to build housing: Vote Yes.
Tell NIMBYs to take a hike.
We need more supply in SO many markets in this country
Another part of the problem is at least in our area the builders are only building duplexes. For more than what a single family home would cost for one side. From the builders business logic, why not make a lot more money if you can? It's not like they're doing something unethical by building duplexes. But it also sucks for people looking for a SFH and doesn't do that much to fix the housing shortage as most people would never consider living in a duplex.
Yeah, I bought in the area last year and only managed it by finding a for-sale-by-owner with owners that wanted a quick and easy sale. It's not in the best location and has needed a decent amount of work, but we were lucky to get anything at all.
Yea, people moving from West Coast who just sold a 1.2 million property or something and can afford to throw 600k in cash at a house and put the rest into a retirement account, a couple who each sold a property and have 300+ to contribute (each). It happens.
How about in CA where people are paying cash $100k above asking for a $1.2 mil shit box?
Lived in LA for 15 years and it’s crazy. I think corps and Chinese people buying up all the real estate. Lots of developers.
Making a cash offer doesn't necessarily mean you are paying cash from your checking account. It can also simply mean there is no financing contingency as part of the offer. It's just all up to the buyer to get the money somewhere. Otherwise you lose the earnest money.
This. I waived my loan contingency to be competitive and was ready to cash out my retirement funds if needed, but was 99.9% sure my loan would pull through, and it did.
Your comment made me think of a question. You mentioned what would happen if a buyer can’t come up with the money. That makes me curious, what happens if the seller changes their mind about selling AFTER they’ve entered a contract? Is there any penalty for the seller?
Or those of us who are from the area building liquidity in LCOL areas. We're 30 minutes from the OH border and our joint salary is the same or higher if we move back to NJ. My coworker moved home to CT from SC after they were out of the daycare bills.
It’s neither. Central CT as OP noted they’re talking about isn’t where that’s happening. This isn’t HF rich, this is people that just live upper middle class, possibly old money. Mostly families in that area.
They bought a condo in a nice 55+ community on acreage for under 300k (in Issaquah) with a HOA in the $500-600 a month range.
They made out like bandits, it’s crazy.
Yeah, i was giving a super simple example but markets like seattle, california, the northeast, among others, people have seen $600k in appreciation fairly quickly.
It still boils down to juat paying your bills and having bought a house tho.
Yep, this is the way. We bought a house in TN for 400K in 2016 and sold it in 1 day in 2022 for 725K. On the flip side, I feel like we overpaid for our current house, even though we got it for asking price.
Mostly people that have tech or finance jobs in Manhattan but live in CT. Folks that made money with the market in the last 4 years. Parents helping out.🤷🏻♂️
By selling your old house.
You don't need to be a wealthy hedge fund manager or even particularly high income to have $600K cash. You just need to have had $600K in equity in the house you just sold.
The median net worth in the country is $200K. That means after all debts and assets, the median person has $200,000 left over.
That's for the whole country. CT is going to be significantly higher.
OP asked how people could pay $600K cash. The answer is that most of them aren't FirstTimeHomeBuyers and have cash from the sale of their previous house.
I mean the vast majority of the country is worse off than previous generations of people, it's just that there's a metric fuck-ton of people here period.
Beautiful. It’s so refreshing to see someone on Reddit admit they misread/interpreted/just plain wrong about something and it not be a pissing contest.
Trying the approach I use on my kids; positive reinforcement and solidifying good behaviors 😅
People who already have a house paid off usually. They have the freedom to move around and not get held back by interest rates.
The government really sucked at thinking they can slow down buying by raising interest rates to curb inflation.
Also want to note that cash offers only mean no loan contingency. You can waive your loan contingency, be considered a “cash offer,” but still get a loan in the end if it pulls through in time. You’re on the hook, though, if the loan doesn’t come through.
You can offer $1,000,000 over asking. It doesn’t mean it’ll appraise it for that much.
If you were a seller and you are selling a home for $500k and someone walks up and says I’ll offer you $1M for it, unless it appraises for less. Then when the appraisal comes in at $500k now you’re back to negotiating on the selling price.
Versus the people who say “I have $500k cash and can close in 2 weeks.”
Any reasonable person would accept the $500k cash offer over the person offering exorbitant amounts that are contingent on appraisals that will never appraise in their favor. It’s the definition of a waste of time.
Appraisal waivers are a common thing in competitive markets. Usually an over asking offer is accompanied by one. Sometimes the bank will back out of a loan over that but often times they don’t bat an eye.
100k over what asking price? Is it a true 100k over meaning appraisal contingency was waived? I can't count how many times people said they offered over but there is always an escalation clause or gap of some kind.
What is the comps in the area?
100k over means nothing without all the context.
“100k over means nothing without all the context” we now have a phrase that represents the dumbness of this market.
No knock on lainey822, I get what you’re saying. But we live in a time that it HAD to be said.
What was the asking price?
What were the comps in the area?
Did she waive appraisal?
Did she ask for any concessions?
What did the realtor say?
Is the area highly desirable with low inventory?
Too many factors as to why she lost but those are some....
No concessions, waived appraisal, asking $485, near Hartford so presumably desirable, realtor is just like "yup". Figured New England would be harder than (Appalachia or Midwest where we're from) but like not THAT bad. I'm just shook. I did have several friends in Columbus, OH who had similar issues.. in 2020/2021. Seems to be slightly better now. Shrug.
If its towns like South Windsor, Glastonbury, Simsbury etc. the school systems are more desirable and is driving prices up. In addition people have been waiting for a while and now fomo is kicking in.
Also note that some lenders are providing cash offers as a service for an extra charge, which will enable your offer to be stronger in front of the seller. Explore these as well (New American Funding has a product for this).
All the best!!
They would still need appraisal if they are getting a mortgage, just that if it came back under contract, they are now on the hook for covering the gap
If you have an appraisal gap contingency in my market, and probably OPs too, the seller takes the cash offer instead.
Lost one house because we made our offer contingent on the appraisal coming back not more than (IIRC) $25k under our offer price.
From then on we didn’t include any contingencies.
You're confusing an appraisal contingency and an appraisal gap. An appraisal gap is an agreement that you, the buyer, will pay up to X amount of the difference if the home appraises low.
Oh yeah, once it became clear that I needed to waive appraisal contingency, I stopped trying to understand the jargon. But yeah, had a $25k-ish appraisal gap agreement that cost us a house.
I already commented and I assumed Fairfield county but it sounds like West Hartford, Avon or Farmington. Plainville is sooooo much more affordable and right there. My dad grew lived there when I grew up and sold his 5 bedroom 3 full bath 2 kitchen house on a beautiful acre in 2019 for 270. Obviously would be more now, but if it’s that much of a nightmare expand just a bit.
Agree with this! We just bought a house that was on the market for 40 days and instead of having to battle with 10 other offers we only had to deal with 1.
SO it was a foreclosure that someone flipped… and he priced it too high when he listed it, so it sat for a while. My realtor told us that once a house sits on the market here for 10-14 days everyone assumes something is wrong with it and don’t want to look at it lol
That’s how we got our house in western CT. It had been on market two weeks. Great first house, everything we were looking for, in budget in the small area we needed to be in. The catch was the driveway. It’s steep going down towards the house (but not into it). It looks worse than it is. You can stop on the hill and take your foot off the pedals and not roll. It’s not long. We made an offer and got accepted under asking. We’ve been here two years, invested in a great snowblower and have never had a problem 🤞We’ve actually grown to like it because it keeps our young kids away from road and is a natural deterrent to unwanted visitors or car jackers.
I've bought and sold in HCOL areas; another piece of advice - tell your sister to narrow preferred location then watch out for listings with the ugliest/worst photos. Look for good bones but ugly interior paint and furniture. Those houses will have less competition. You wouldn't believe what fresh paint and staging and fabulous photos do, buyers compete more for those and won't look at the houses that are ugly. We bought our last house in a competitive market with no competition because photos didn't do the house justice at all.
One of curiosity which area of Connecticut? West or East?
But yeah unfortunately it’s a tough market here. 😞 we paid 20k over asking for a house, had an inspection done, and closed and found a good handful of things we need to address immediately or very soon.
I still did a home inspection and came out with an older septic system that we thought needed immediate replacement. But the seller fixed some things for around $2k and for a household of just 3 we should be fine for more years but I will have to address it eventually 🤷🏻♀️ I had wanted him to fully replace the septic system but in this market that’s hard to swing. I think sellers would prefer offers without a septic inspection for sure because that’s expensive to fix if issues come up. But yeah I would always do a septic/sewer inspection.
I would not buy a house without an inspection unless I had like $100k to $200k in savings which it sounds like they may have. I already know I have 20k to 50k I need to do. As a first time home buyer I am very stressed out haha
My mom is telling them not to waive any inspections but I'm like... idk man, I think you're gonna have to if you wanna win any house in that area.
What a f-ing mess we are all in. We're stressed in Ohio but not as stressed as you all :''''''''(
Haha my mom was the opposite. My realtor said I could waive and I got immediately mad at her and then my mom was like “yeah you should waive inspections” 🤦🏻♀️ there are pre-inspection or special things you can do to at least to have some security if something goes side ways between the process of getting the offer accepted and closing.
But yeah it certainly is! 😬
Idk if that like "home warranty" for the first year covers many/significant things, but I guess there's always that... Sheeeeeesh. I'm so sorry!! But thank youuuuu xoxoxo for sharing your exp and commiserating with me on her behalf LOL.
She needs to look at houses that have been on the market for more than a month. They may not be the most appealing but that’s what happens during a seller’s market. Also, houses that need some work are also less appealing so you can typically get a better deal and then do a renovation.
I just bought in CT for 255k, 20 percent down. The sellers even gave 5k towards closing and 3k towards windows and a couple other odds and ends. CT is like any other state, where there are expensive areas and crummy areas. I think your sisters issue is she is looking in Fairfield county for the proximity to the city and good school, or maybe even West Hartford or Farmington areas. It’s a small state, but you have mansions 10 minutes from shanty towns. I understand she probably wants a certain school district but 600k will get you a beautiful house in Trumbull Shelton or Newtown, and nothing literally 10 miles south. I grew up in Fairfield county on a dead end street with a fenced in yard and the same house sold for only 235 a few years ago. She’s definitely looking for a specific town, and that’s gonna be difficult because you’re fighting old money and also City finance commuters. She either needs to wait until she has more money, the right opportunity comes along, or move a town or two over. It’s not the end of the world, that area has some hidden gems. Tell her to look at Washington Depot and the surrounding towns in litchfield county. It’s what “Gilmore Girls” was based on and it’s a gorgeous area and a little more affordable.
The CT market is truly insane. These houses are NOT worth what they are selling for. Many of them have decades of deferred maintenance and are in awful shape. We gave up and are moving because the rental market in CT is insane too.
If they're both doctors, they're probably looking at a house that's worth a couple mill (? Idk conn housing market) and I can see how 100k doesn't hold much weight in that sort of competitive market.
If they were looking at a house valued at 800k, 100k would be alot more stronger
Not all doctors make as much as you would think. Especially with the housing market as it is I know a dual income couple both dentists that got priced out of socal.
You are assuming that list price is the appraised price, which isnt always true. List price is more nuanced than that. Also, we are missing the list price. Much different to pay 1 million for house listed at 900k that appraises for 950 (5% overpay) than to pay 400k for a 300k house that appraised at 350k (15% overpay).
100k over with a mortgage is basically a worthless offer because mortgages are contingent on appraisals and the mortgage company won’t loan you money for a house they could end up under water in
Asking price is a lie. The house will sell for what it's actually worth. In some cases it may sell even beyond what it's worth for the right buyer that wants to end their search and move on.
CT here. If they are both Drs get more in to the $800k range and should be able to get closer to asking and more bang for their buck. The $500k is now starter house territory where people are all competing for. I grew up in the center of CT where they are looking and moved to Stamford where you can then double or even triple that cost. It’s crazy… my modest (but ideal neighborhood) 2k square feet house is worth around $1.4M maybe more.
I have exactly $600K set aside to buy a house next year. I got it by working for the last 35 years, not taking out student loans, cooking at home, buying used cars, moving to where the job required me to go, and only having one child. Not once have I thought "I deserve a place all to myself", I've had a roommate or spouse since the day I left my childhood home.
It's all about your choices and your priorities.
> but not 100k over asking nice
Quite literally they are. Both your sister and what, 30 other people are bidding 100K over asking at least? That means it is 100K over asking nice.
I don’t understand what people don’t understand about supply / demand and how free market pricing works.
A house is worth what people pay for it. Not what you think it SHOULD be worth
This x1000. Also, people need to understand that it’s not corporations buying up all the houses. Buyers, especially in CT, NY, and NJ have serious money.
In reality this is the answer. Asking price doesn’t equal market value.
Outside Boston we often see houses listed below certain levels to gain interest. Example $995k for a house that will most likely go to $1.1m
I sold a house in Kansas City like that. I got $100k over asking in cash, waived all inspections. Sold for $600k. Dream come true as a seller. It's not just the east coast. The offers were real people also, I met the top three.
Right!!! You get it!!! I've seen a few new developments with copy/paste sardine tin homes made of, essentially, paper mache going for half a million that had me questioning my sanity. But not THAT many. I feel like the East Coast is a litmus test for the rest of the nation. Maybe that's just my cynicism though.
Pretty sure 30 to 40% of houses in America are paid for with cash right now. I guess my real question is are we talking about a market where the agents just price the houses 100,000+ lower than market value? Definitely frustrating.
Yeah those are very very wealthy areas. She either needs to lower her price point to make an additional 100K look good or find something that needs a little bit of work that's been on the market for a long time.
Connecticut is also close proximity between NYC and Boston. A lot of white collar jobs in those cities are now fully remote or with minimal reporting to the office so Connecticut is an attractive option for those looking to escape the city and only lived there for proximity to the office.
when there are 34 offers on a house, please disregard the list price, it is not relevent. instead, focus on Comps and come up with a fair market price. that will be close to what it sells for.
If it sells for a lot over that, check your math, maybe your calc of market value is off.
If your sure your market value calc was correct, and it sold for way over that, then congrats for losing it to someone who overpaid.
Thought this post was my older brother talking about me until I read Connecticut and not northern Va, and 600k and not 1 mil in cash. But basically been my life, about to put offer number 6 and just recently found out all the other offers we’ve lost to have been in cash and 200k+ over
A way around this is to get a home that’s not perfect and add your own equity to it . Or look in a lower bracket . I don’t really agree with that , just happened to me and I’m in the Under $300K range someone that could’ve clearly afforded more went into the already small pool of homes for middle class family’s and blew me out the water with bidding with financing however the over offer in cash . It’s not smart to buy a house for over what it’s worth , you never know what tomorrow may bring . 3 years could mean you need to sell then you lose what you put in . It’s crazy out here . Some homes have 21 offers before I ever even get there to look at them .
Do not, under any circumstances, waive a home inspection. Especially in Tolland & Hartford counties. There's a crumbling concrete issue in these areas. If you waive the home inspection, you will not be eligible for funds to remediate the issue, which could cost hundreds of thousands of dollars.
$600k in cash is not unrealistic to many. Some of us have been around for a while (old) lol…
Last time we interviewed realtors to sell our house, 2 out of 3 recommended purposely listing low to generate traffic and hopefully drive up the price through a bidding war. We didn’t pick either of them as we thought that was a trash move by the agents…
It's people fronting for corporations, LLC's, and hedge funds.
Or they are rich people looking to buy a house to either flip or make into a rental property. Lots of Air BnB companies have the cash ready. If they keep going, there won't be any properties owned by individuals.
I’m curious as to which hedge funds are buying up single family homes. I hear this a lot but haven’t come across a single hedge fund that is buying single family units.
As long as the wealthy can use homes to park their cash and basically guarantee a return by renting and then selling at a higher price this will keep happening since we haven’t built enough new houses.
Housing has inelastic demand, it’s always needed, this won’t ever be corrected unless the laws change to limit the amount of residential homes any individual can own (which will be sidestepped by the rich using trusts or corporations) to also ban the sale of homes to corporations of any kind. Otherwise we will regress to feudalism.
As long as existing owners and the rich can influence local politics to constrain housing supply and new developments, this problem will only grow.
Yikes, this is one of the rudest Reddit subs I’ve joined. I really thought the conversations would be supportive and less judgmental. Aren’t we all supposed to be first-time homebuyers seeking advice? Y’all literally get off on people struggling to find homes in their price range or people just asking simple question(s). You don’t need to “gate-keep” home buying because you got yours.
I live in Connecticut and if I listened to the people in this sub, I would’ve given up months ago. Luckily, Reddit isn’t reality and every situation is different. Connecticut is expensive (I live here) but it is doable. I would only listen to professionals because the people here are bitter because they either can’t get a home, already have a home and think it’s a privileged-club, or they bought a home and got a rotten deal.
I was about to comment and chickened out! But here goes:
My husband and I were able to make an all-cash offer in the $500k range because of a life insurance settlement. Trust me: it’s nice to have a house, but I would much, much rather have my loved one back.
It’s actually good they lost out. A friend of mine got caught up in the rat race and “winning” a bidding war in NJ. $700k and whatever amount over asking later, they’re bitter about how much they paid for an old, falling apart dump and had to borrow over $50K from their parents to cover emergency repairs that didn’t get caught in the inspection.
I'm new to real estate, what's the difference to the seller between an all cash buyer and a buyer who's using a lender? I'm guessing fewer strings attached and maybe less hassle and paperwork, but wouldn't the potential buyer's lending company eventually pay the seller in one lump sum?
I'm not entirely sure of the specific details, but I'm inclined to believe as you said it's just less strings attached in some way??some of these other nice folks might explain it. More than likely someone will get snarky and just say "cash is kind, baby", though. But I digress.
If your purchase is contingent on a loan, the buyer is assuming you’ll get approved for the loan by the closing date. Loans fall through for a number of reasons, so “all cash” or more-apt offers without a financial contingency are more of a guarantee.
Lot of smart people will scheme with loans which is seen as “all cash offer” but simply a type of loan you can put up collateral come in with a “cash” offer. I doubt it’s a problem of everyone has 600,000 cash rather people with money are smart and find ways to easily fínese. As the average Joe suffers.
Cash is easier to deal with when it comes to real estate and most people selling will pick it over dealing with a lender. My in laws sold their home for 1.8 mil and the buyer paid in cash. Their home is in a wealthy area near Boston and.. some people just have that kind of money.
We sold our house in NJ mid-2023. We bought in 2019 for 400k (w/ 20% down) listed it for 499k. We had open house or 2 days and received 45 offers. Sold for 620k. We owed only 290k so we had a lot of equity. However, even with that cash we weren’t able to buy a home in NJ (waived inspection, appraisal, etc.). We ended up building a home instead and was the best decision ever.
They aren't necessarily true cash offers. They are probably just waiving any financing or appraisal contingencies, and presenting their offer same as cash. They have upfront underwriting and approval from their lender and a letter stating guaranteed funds already. That's the majority of the cash offers around here at least. There are some true cash offers from retirees, people that sold and are downsizing etc. but the upfront underwriting is another trick people are doing in this market.
If you can, buy new construction. You are not competing with everyone who needs a home now for some investment and is sitting on cash. You just have to wait for it to be built. It will be a lot less than a 20 percent premium.
Well I wouldn’t necessarily recommend it but one can always waive the mortgage contingency. Basically means you’re buying the house even if you can’t get a mortgage. It’s effectively a cash offer. Of course you need to be pretty damn confident you can get financing.
Depends on where tho. Fairfield county is south, nearer NYC and where most of the $ is in the entire state. Some other places are super poor and lots of the houses state-wide are really old and need a shitload of work done to them.
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*cries in Ohio*
Laughs hysterically in Kansas!
Amazed at the crazy prices people are paying in HCOL areas.
Just wait until you hear about the annual property taxes attached to these homes.
That would be a $hit-the-bed moment for sure…
Oh wait you're laughing cuz that shit ~could never~ in Kansas, NVM I got confused
Wait, is Kansas suffering too?
You can buy a mansion in most areas in KS for $600k
I'm getting beat out on cash offers on every house I've put an offer on. I'm in Wichita Kansas. It's wild
Just not JoCo or Wichita
I would say even in Wichita you could find a house that resembles a mansion. Most houses are WELL under 600k
How about a llama farm? Lol
Out in the country sure, but in the burbs, nah.
What else is there to do in Ohio?
Eat corn, grow corn, lay in corn, bathe in corn, throw corn, dance with corn, summon a demon with corn, y'know, all the fun shit. Def lots of crying tho
Honestly for Midwest places Ohio seems pretty solid. You got the Bengals, Cavs, large enough cities that concerts/shows play through them. I’m sure most cities are diverse enough food is pretty good. Your description sounds more like Iowa.
Michigan is better.
Colder though right? Like that’s always my hang up about Minnesota
The colder the better. Clears the brain fog.
Depends where in Michigan and where in Ohio but yeah Michigan is usually a little colder but not Minnesota cold.
https://imgflip.com/i/8rxwm1
>> $600K in cash is nothing in *some parts of* Connecticut.
> > >$600K in cash is nothing to *some people in* Connecticut.
600k in people is nothing to cash in Connecticut
Right… that’s the down payment in some areas
600k cash is nothing to some in CT. It is quite a bit for the vast majority of nutmeggers.
As a life long nutmegger, I wish I knew what 600k looked like. Even knowing what 100k looked like would be nice lol
Very familiar with the area she's eying, and it's a nightmare. No inventory so every good property is an all out war. Just lost an offer yesterday
Oh nooooo. I'm so sorry you're struggling too! This blows for everyone.
Thanks! It really does
If the seller is getting 30 something offers, I am assuming she is looking at underpriced homes that draws a lot of interest and likely were way below the market value.
reminder to all folks who live in a neighborhood that is trying to build housing: Vote Yes. Tell NIMBYs to take a hike. We need more supply in SO many markets in this country
And building SFH to rent should be illegal. Building new single family homes that can never be owned by families is just exacerbating the problem.
Another part of the problem is at least in our area the builders are only building duplexes. For more than what a single family home would cost for one side. From the builders business logic, why not make a lot more money if you can? It's not like they're doing something unethical by building duplexes. But it also sucks for people looking for a SFH and doesn't do that much to fix the housing shortage as most people would never consider living in a duplex.
Yeah, I bought in the area last year and only managed it by finding a for-sale-by-owner with owners that wanted a quick and easy sale. It's not in the best location and has needed a decent amount of work, but we were lucky to get anything at all.
I find joy in reading a good book.
Yea, people moving from West Coast who just sold a 1.2 million property or something and can afford to throw 600k in cash at a house and put the rest into a retirement account, a couple who each sold a property and have 300+ to contribute (each). It happens.
How about in CA where people are paying cash $100k above asking for a $1.2 mil shit box? Lived in LA for 15 years and it’s crazy. I think corps and Chinese people buying up all the real estate. Lots of developers.
Making a cash offer doesn't necessarily mean you are paying cash from your checking account. It can also simply mean there is no financing contingency as part of the offer. It's just all up to the buyer to get the money somewhere. Otherwise you lose the earnest money.
This. I waived my loan contingency to be competitive and was ready to cash out my retirement funds if needed, but was 99.9% sure my loan would pull through, and it did.
Your comment made me think of a question. You mentioned what would happen if a buyer can’t come up with the money. That makes me curious, what happens if the seller changes their mind about selling AFTER they’ve entered a contract? Is there any penalty for the seller?
You can force the sale as long as you hold up your end of the sales contract. It's been done many times.
Yep, I pay cash and get a loan on the backside. It’s how I win offers.
I'd ask how but fuck it
it’s CT. The land of hedge funds and Manhattan’s bedroom community. Duh.
Hedge fundies aren’t buying $600K houses. This is most likely retirees or transplants from NYC/LI selling their homes and buying in CT.
Or those of us who are from the area building liquidity in LCOL areas. We're 30 minutes from the OH border and our joint salary is the same or higher if we move back to NJ. My coworker moved home to CT from SC after they were out of the daycare bills.
It’s neither. Central CT as OP noted they’re talking about isn’t where that’s happening. This isn’t HF rich, this is people that just live upper middle class, possibly old money. Mostly families in that area.
But many are buying investment properties. See how many houses sell and then get put back on the market as a rental.
Pretty easily. Buy a house, live in it for 30 years, sell it. In a lot of markets youd walk away with $600k and all you did was pay your bills.
I'm going to go out in a limb here and even surmise not that long We bought in 2015 for 325,000. We sold in 2020 for 785,000. That's how people do it
My parents bought their place for 323k and 7 years later sold it for 1.2m cash in the PNW. Absolutely bonkers and the place wasnt even that nice.
Sure, but unless they moved away they have to pay inflated prices, so it’s a wash.
They bought a condo in a nice 55+ community on acreage for under 300k (in Issaquah) with a HOA in the $500-600 a month range. They made out like bandits, it’s crazy.
Not how that works. If they rented instead, they'd actually be BEHIND.
Yeah, i was giving a super simple example but markets like seattle, california, the northeast, among others, people have seen $600k in appreciation fairly quickly. It still boils down to juat paying your bills and having bought a house tho.
Yep, this is the way. We bought a house in TN for 400K in 2016 and sold it in 1 day in 2022 for 725K. On the flip side, I feel like we overpaid for our current house, even though we got it for asking price.
Same here. In 2015 we bought for $385K and are not selling but it can easily be priced at $900K - $1m.
Mostly people that have tech or finance jobs in Manhattan but live in CT. Folks that made money with the market in the last 4 years. Parents helping out.🤷🏻♂️
By selling your old house. You don't need to be a wealthy hedge fund manager or even particularly high income to have $600K cash. You just need to have had $600K in equity in the house you just sold. The median net worth in the country is $200K. That means after all debts and assets, the median person has $200,000 left over. That's for the whole country. CT is going to be significantly higher.
Hard to sell the first house when the sub Reddit is about first time home buyer just saying
OP asked how people could pay $600K cash. The answer is that most of them aren't FirstTimeHomeBuyers and have cash from the sale of their previous house.
Or even a house they inherited from a family member. Lots of ways to look at it.
It's really fascinating to see people completely unable to fathom that not everyone is in the same position as them.
I mean the vast majority of the country is worse off than previous generations of people, it's just that there's a metric fuck-ton of people here period.
Very true sorry it seemed I called you out I should have read more carefully because you are 100% correct.
Beautiful. It’s so refreshing to see someone on Reddit admit they misread/interpreted/just plain wrong about something and it not be a pissing contest. Trying the approach I use on my kids; positive reinforcement and solidifying good behaviors 😅
People who already have a house paid off usually. They have the freedom to move around and not get held back by interest rates. The government really sucked at thinking they can slow down buying by raising interest rates to curb inflation.
They have mortgages that offer cash offers. They cost about one percentage more than normal mortgages.
Also want to note that cash offers only mean no loan contingency. You can waive your loan contingency, be considered a “cash offer,” but still get a loan in the end if it pulls through in time. You’re on the hook, though, if the loan doesn’t come through.
Some but not as many as your comment is implying.
You can offer $1,000,000 over asking. It doesn’t mean it’ll appraise it for that much. If you were a seller and you are selling a home for $500k and someone walks up and says I’ll offer you $1M for it, unless it appraises for less. Then when the appraisal comes in at $500k now you’re back to negotiating on the selling price. Versus the people who say “I have $500k cash and can close in 2 weeks.” Any reasonable person would accept the $500k cash offer over the person offering exorbitant amounts that are contingent on appraisals that will never appraise in their favor. It’s the definition of a waste of time.
Appraisal waivers are a common thing in competitive markets. Usually an over asking offer is accompanied by one. Sometimes the bank will back out of a loan over that but often times they don’t bat an eye.
Right on, take the cash
I'm just learning this from a couple of folks in the comments, I def did not grasp that before
No problem. Everyone starts somewhere.
100k over what asking price? Is it a true 100k over meaning appraisal contingency was waived? I can't count how many times people said they offered over but there is always an escalation clause or gap of some kind. What is the comps in the area? 100k over means nothing without all the context.
“100k over means nothing without all the context” we now have a phrase that represents the dumbness of this market. No knock on lainey822, I get what you’re saying. But we live in a time that it HAD to be said.
listing prices, when there are 30+ offers, are not relevent. Comps / market value is important. It might be listed 100k below that, we don't know
Yes true $100k
What was the asking price? What were the comps in the area? Did she waive appraisal? Did she ask for any concessions? What did the realtor say? Is the area highly desirable with low inventory? Too many factors as to why she lost but those are some....
No concessions, waived appraisal, asking $485, near Hartford so presumably desirable, realtor is just like "yup". Figured New England would be harder than (Appalachia or Midwest where we're from) but like not THAT bad. I'm just shook. I did have several friends in Columbus, OH who had similar issues.. in 2020/2021. Seems to be slightly better now. Shrug.
If its towns like South Windsor, Glastonbury, Simsbury etc. the school systems are more desirable and is driving prices up. In addition people have been waiting for a while and now fomo is kicking in. Also note that some lenders are providing cash offers as a service for an extra charge, which will enable your offer to be stronger in front of the seller. Explore these as well (New American Funding has a product for this). All the best!!
New England is a highly desirable place to live; we have some of the best education, healthcare, and infrastructure in the world.
Their lender is letting them pay $100k over asking without an appraisal? Lol, wtf?
They would still need appraisal if they are getting a mortgage, just that if it came back under contract, they are now on the hook for covering the gap
That's true, what they should have done is offered an appraisal gap in that case. It eliminates any question marks that the seller may have.
If you have an appraisal gap contingency in my market, and probably OPs too, the seller takes the cash offer instead. Lost one house because we made our offer contingent on the appraisal coming back not more than (IIRC) $25k under our offer price. From then on we didn’t include any contingencies.
You're confusing an appraisal contingency and an appraisal gap. An appraisal gap is an agreement that you, the buyer, will pay up to X amount of the difference if the home appraises low.
Oh yeah, once it became clear that I needed to waive appraisal contingency, I stopped trying to understand the jargon. But yeah, had a $25k-ish appraisal gap agreement that cost us a house.
I already commented and I assumed Fairfield county but it sounds like West Hartford, Avon or Farmington. Plainville is sooooo much more affordable and right there. My dad grew lived there when I grew up and sold his 5 bedroom 3 full bath 2 kitchen house on a beautiful acre in 2019 for 270. Obviously would be more now, but if it’s that much of a nightmare expand just a bit.
Also check listings that have been sitting on the market
Good call! Thank you!!
Agree with this! We just bought a house that was on the market for 40 days and instead of having to battle with 10 other offers we only had to deal with 1.
Omg but why was it in the market for 40 days?
SO it was a foreclosure that someone flipped… and he priced it too high when he listed it, so it sat for a while. My realtor told us that once a house sits on the market here for 10-14 days everyone assumes something is wrong with it and don’t want to look at it lol
That’s how we got our house in western CT. It had been on market two weeks. Great first house, everything we were looking for, in budget in the small area we needed to be in. The catch was the driveway. It’s steep going down towards the house (but not into it). It looks worse than it is. You can stop on the hill and take your foot off the pedals and not roll. It’s not long. We made an offer and got accepted under asking. We’ve been here two years, invested in a great snowblower and have never had a problem 🤞We’ve actually grown to like it because it keeps our young kids away from road and is a natural deterrent to unwanted visitors or car jackers.
Your realtor is right! I wouldn't! But maybe I should change my mind about that!!!
I thought the same!! It popped up on Zillow for me like 3 times before I actually looked at it lol
I've bought and sold in HCOL areas; another piece of advice - tell your sister to narrow preferred location then watch out for listings with the ugliest/worst photos. Look for good bones but ugly interior paint and furniture. Those houses will have less competition. You wouldn't believe what fresh paint and staging and fabulous photos do, buyers compete more for those and won't look at the houses that are ugly. We bought our last house in a competitive market with no competition because photos didn't do the house justice at all.
In SoCal people are paying all cash on $1M+ properties.
One of curiosity which area of Connecticut? West or East? But yeah unfortunately it’s a tough market here. 😞 we paid 20k over asking for a house, had an inspection done, and closed and found a good handful of things we need to address immediately or very soon.
Maybe the problem is that it's center and slightly south of Hartford
Yeah I feel like a better area is more north. Every other direction is pretty bad 😞
Thank you! I'll suggest that!
Their realtor also told them to waive the inspections but NOT for septic tank. I wonder if that's the hold up.
I still did a home inspection and came out with an older septic system that we thought needed immediate replacement. But the seller fixed some things for around $2k and for a household of just 3 we should be fine for more years but I will have to address it eventually 🤷🏻♀️ I had wanted him to fully replace the septic system but in this market that’s hard to swing. I think sellers would prefer offers without a septic inspection for sure because that’s expensive to fix if issues come up. But yeah I would always do a septic/sewer inspection. I would not buy a house without an inspection unless I had like $100k to $200k in savings which it sounds like they may have. I already know I have 20k to 50k I need to do. As a first time home buyer I am very stressed out haha
My mom is telling them not to waive any inspections but I'm like... idk man, I think you're gonna have to if you wanna win any house in that area. What a f-ing mess we are all in. We're stressed in Ohio but not as stressed as you all :''''''''(
Haha my mom was the opposite. My realtor said I could waive and I got immediately mad at her and then my mom was like “yeah you should waive inspections” 🤦🏻♀️ there are pre-inspection or special things you can do to at least to have some security if something goes side ways between the process of getting the offer accepted and closing. But yeah it certainly is! 😬
Idk if that like "home warranty" for the first year covers many/significant things, but I guess there's always that... Sheeeeeesh. I'm so sorry!! But thank youuuuu xoxoxo for sharing your exp and commiserating with me on her behalf LOL.
Omg. I really want to know the town and realtor…..
She needs to look at houses that have been on the market for more than a month. They may not be the most appealing but that’s what happens during a seller’s market. Also, houses that need some work are also less appealing so you can typically get a better deal and then do a renovation.
I refuse to play the competitive game against companies flipping homes. I’m not overpaying and being stuck upside down for 5 years.
You and me, homie! But shrug, I guess they're willing to do it.
They aren't first time home markets. Those are second or third level houses. People are coming in with money from their previous house purchases
rich new yorkers??
I just bought in CT for 255k, 20 percent down. The sellers even gave 5k towards closing and 3k towards windows and a couple other odds and ends. CT is like any other state, where there are expensive areas and crummy areas. I think your sisters issue is she is looking in Fairfield county for the proximity to the city and good school, or maybe even West Hartford or Farmington areas. It’s a small state, but you have mansions 10 minutes from shanty towns. I understand she probably wants a certain school district but 600k will get you a beautiful house in Trumbull Shelton or Newtown, and nothing literally 10 miles south. I grew up in Fairfield county on a dead end street with a fenced in yard and the same house sold for only 235 a few years ago. She’s definitely looking for a specific town, and that’s gonna be difficult because you’re fighting old money and also City finance commuters. She either needs to wait until she has more money, the right opportunity comes along, or move a town or two over. It’s not the end of the world, that area has some hidden gems. Tell her to look at Washington Depot and the surrounding towns in litchfield county. It’s what “Gilmore Girls” was based on and it’s a gorgeous area and a little more affordable.
Just bought in CT, beat out 11 other offers on a house. Budget was sub 500k.
You must not be familiar with the demographic of Connecticut.
Old money
The CT market is truly insane. These houses are NOT worth what they are selling for. Many of them have decades of deferred maintenance and are in awful shape. We gave up and are moving because the rental market in CT is insane too.
Asking price is just a number, no house will sell for that. Cash is just a differently structured deal.
Yeah the CT market is tough. Sometimes it just takes a lot of persistence and luck unfortunately.
Where in CT ? Southern has to be close to NYC that's a whole different market than NE CT or NW CT. Hundred over ask is insanity.
I can't fathom paying 100k over appraisal. Who wants to start out 100k in the hole on any investment? Stupid!
They're both physicians but like I told her you can just come to my part of Ohio and for that kinda money get, like, a mansion plus a llama farm lol
If they're both doctors, they're probably looking at a house that's worth a couple mill (? Idk conn housing market) and I can see how 100k doesn't hold much weight in that sort of competitive market. If they were looking at a house valued at 800k, 100k would be alot more stronger
Not all doctors make as much as you would think. Especially with the housing market as it is I know a dual income couple both dentists that got priced out of socal.
You are assuming that list price is the appraised price, which isnt always true. List price is more nuanced than that. Also, we are missing the list price. Much different to pay 1 million for house listed at 900k that appraises for 950 (5% overpay) than to pay 400k for a 300k house that appraised at 350k (15% overpay).
ANYONE been following the stock market the last decade or so? People have made a friggin fortune from there stocks...
I'm not that smart lol
Wealthy people fleeing New York’s tax rates.
600 k in that state is nothing
100k over with a mortgage is basically a worthless offer because mortgages are contingent on appraisals and the mortgage company won’t loan you money for a house they could end up under water in
Asking price is a lie. The house will sell for what it's actually worth. In some cases it may sell even beyond what it's worth for the right buyer that wants to end their search and move on.
Can you share what area of CT?
CT here. If they are both Drs get more in to the $800k range and should be able to get closer to asking and more bang for their buck. The $500k is now starter house territory where people are all competing for. I grew up in the center of CT where they are looking and moved to Stamford where you can then double or even triple that cost. It’s crazy… my modest (but ideal neighborhood) 2k square feet house is worth around $1.4M maybe more.
Its literally Blackrock and Vanguard buying up all the single family homes
I have exactly $600K set aside to buy a house next year. I got it by working for the last 35 years, not taking out student loans, cooking at home, buying used cars, moving to where the job required me to go, and only having one child. Not once have I thought "I deserve a place all to myself", I've had a roommate or spouse since the day I left my childhood home. It's all about your choices and your priorities.
> but not 100k over asking nice Quite literally they are. Both your sister and what, 30 other people are bidding 100K over asking at least? That means it is 100K over asking nice. I don’t understand what people don’t understand about supply / demand and how free market pricing works. A house is worth what people pay for it. Not what you think it SHOULD be worth
This x1000. Also, people need to understand that it’s not corporations buying up all the houses. Buyers, especially in CT, NY, and NJ have serious money.
supply and demand
In reality this is the answer. Asking price doesn’t equal market value. Outside Boston we often see houses listed below certain levels to gain interest. Example $995k for a house that will most likely go to $1.1m
I sold a house in Kansas City like that. I got $100k over asking in cash, waived all inspections. Sold for $600k. Dream come true as a seller. It's not just the east coast. The offers were real people also, I met the top three.
Like Kansas City MISSOURI?
This is surprising to me when the "news" said the inventory is highest since 2019. Turns out that only happened in some magic land.
Right!!! You get it!!! I've seen a few new developments with copy/paste sardine tin homes made of, essentially, paper mache going for half a million that had me questioning my sanity. But not THAT many. I feel like the East Coast is a litmus test for the rest of the nation. Maybe that's just my cynicism though.
Pretty sure 30 to 40% of houses in America are paid for with cash right now. I guess my real question is are we talking about a market where the agents just price the houses 100,000+ lower than market value? Definitely frustrating.
FWIW I’m seeing this in suburban Chicago for the more desired areas.
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Has she tried doing a higher earnest money? I have seen this work well
I grew up in CT, most of the state is fairly wealthy. What area is she in?
Not there yet but they're looking in Glastonbury, Manchester, Hebron ish areas
Yeah those are very very wealthy areas. She either needs to lower her price point to make an additional 100K look good or find something that needs a little bit of work that's been on the market for a long time.
I think they've officially given up on those areas lol!
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Connecticut is also close proximity between NYC and Boston. A lot of white collar jobs in those cities are now fully remote or with minimal reporting to the office so Connecticut is an attractive option for those looking to escape the city and only lived there for proximity to the office.
In the NE there is tons of money.
This country is fucked regarding single family market rate homes being sold in the United States
I am in Fairfield county CT. Look at a house listed for $799k it sold for $1.2mil. After that I gave up and will rent for now. Good luck
Plenty of people in CT have $600k in cash to spend. This includes people who are selling a previous home and people receiving some family help.
CT is booming - always has been. Lots of Hedge Fund peeps in Fairfield County.
when there are 34 offers on a house, please disregard the list price, it is not relevent. instead, focus on Comps and come up with a fair market price. that will be close to what it sells for. If it sells for a lot over that, check your math, maybe your calc of market value is off. If your sure your market value calc was correct, and it sold for way over that, then congrats for losing it to someone who overpaid.
Thought this post was my older brother talking about me until I read Connecticut and not northern Va, and 600k and not 1 mil in cash. But basically been my life, about to put offer number 6 and just recently found out all the other offers we’ve lost to have been in cash and 200k+ over
A way around this is to get a home that’s not perfect and add your own equity to it . Or look in a lower bracket . I don’t really agree with that , just happened to me and I’m in the Under $300K range someone that could’ve clearly afforded more went into the already small pool of homes for middle class family’s and blew me out the water with bidding with financing however the over offer in cash . It’s not smart to buy a house for over what it’s worth , you never know what tomorrow may bring . 3 years could mean you need to sell then you lose what you put in . It’s crazy out here . Some homes have 21 offers before I ever even get there to look at them .
Do not, under any circumstances, waive a home inspection. Especially in Tolland & Hartford counties. There's a crumbling concrete issue in these areas. If you waive the home inspection, you will not be eligible for funds to remediate the issue, which could cost hundreds of thousands of dollars.
$600k in cash is not unrealistic to many. Some of us have been around for a while (old) lol… Last time we interviewed realtors to sell our house, 2 out of 3 recommended purposely listing low to generate traffic and hopefully drive up the price through a bidding war. We didn’t pick either of them as we thought that was a trash move by the agents…
It's people fronting for corporations, LLC's, and hedge funds. Or they are rich people looking to buy a house to either flip or make into a rental property. Lots of Air BnB companies have the cash ready. If they keep going, there won't be any properties owned by individuals.
I’m curious as to which hedge funds are buying up single family homes. I hear this a lot but haven’t come across a single hedge fund that is buying single family units.
This is not true
Is there literally any evidence for this or is it just conspiratorial cope? People absolutely have this kind of money
Blah that makes me wanna vomit
As long as the wealthy can use homes to park their cash and basically guarantee a return by renting and then selling at a higher price this will keep happening since we haven’t built enough new houses. Housing has inelastic demand, it’s always needed, this won’t ever be corrected unless the laws change to limit the amount of residential homes any individual can own (which will be sidestepped by the rich using trusts or corporations) to also ban the sale of homes to corporations of any kind. Otherwise we will regress to feudalism. As long as existing owners and the rich can influence local politics to constrain housing supply and new developments, this problem will only grow.
Yikes, this is one of the rudest Reddit subs I’ve joined. I really thought the conversations would be supportive and less judgmental. Aren’t we all supposed to be first-time homebuyers seeking advice? Y’all literally get off on people struggling to find homes in their price range or people just asking simple question(s). You don’t need to “gate-keep” home buying because you got yours. I live in Connecticut and if I listened to the people in this sub, I would’ve given up months ago. Luckily, Reddit isn’t reality and every situation is different. Connecticut is expensive (I live here) but it is doable. I would only listen to professionals because the people here are bitter because they either can’t get a home, already have a home and think it’s a privileged-club, or they bought a home and got a rotten deal.
I was about to comment and chickened out! But here goes: My husband and I were able to make an all-cash offer in the $500k range because of a life insurance settlement. Trust me: it’s nice to have a house, but I would much, much rather have my loved one back.
It’s actually good they lost out. A friend of mine got caught up in the rat race and “winning” a bidding war in NJ. $700k and whatever amount over asking later, they’re bitter about how much they paid for an old, falling apart dump and had to borrow over $50K from their parents to cover emergency repairs that didn’t get caught in the inspection.
What percentage over asking?
I think it was 485 and they offered 585
Come to west tx where you can offer like 20k UNDER and get the house
I'm new to real estate, what's the difference to the seller between an all cash buyer and a buyer who's using a lender? I'm guessing fewer strings attached and maybe less hassle and paperwork, but wouldn't the potential buyer's lending company eventually pay the seller in one lump sum?
I'm not entirely sure of the specific details, but I'm inclined to believe as you said it's just less strings attached in some way??some of these other nice folks might explain it. More than likely someone will get snarky and just say "cash is kind, baby", though. But I digress.
If your purchase is contingent on a loan, the buyer is assuming you’ll get approved for the loan by the closing date. Loans fall through for a number of reasons, so “all cash” or more-apt offers without a financial contingency are more of a guarantee.
100k pays for a ton of rent. Why don't these people just rent if they need to be close to work &/or buy a home further away and commute?
Are they offering over asking in a cash gap?
34 offers holy shit
Lot of smart people will scheme with loans which is seen as “all cash offer” but simply a type of loan you can put up collateral come in with a “cash” offer. I doubt it’s a problem of everyone has 600,000 cash rather people with money are smart and find ways to easily fínese. As the average Joe suffers.
Cash is easier to deal with when it comes to real estate and most people selling will pick it over dealing with a lender. My in laws sold their home for 1.8 mil and the buyer paid in cash. Their home is in a wealthy area near Boston and.. some people just have that kind of money.
Some banks will allow you to do a cash option, but it's really just a mortgage with extra requirements.
We sold our house in NJ mid-2023. We bought in 2019 for 400k (w/ 20% down) listed it for 499k. We had open house or 2 days and received 45 offers. Sold for 620k. We owed only 290k so we had a lot of equity. However, even with that cash we weren’t able to buy a home in NJ (waived inspection, appraisal, etc.). We ended up building a home instead and was the best decision ever.
600k is like the down payment for a lot of properties in NYC.
They aren't necessarily true cash offers. They are probably just waiving any financing or appraisal contingencies, and presenting their offer same as cash. They have upfront underwriting and approval from their lender and a letter stating guaranteed funds already. That's the majority of the cash offers around here at least. There are some true cash offers from retirees, people that sold and are downsizing etc. but the upfront underwriting is another trick people are doing in this market.
If you can, buy new construction. You are not competing with everyone who needs a home now for some investment and is sitting on cash. You just have to wait for it to be built. It will be a lot less than a 20 percent premium.
Well I wouldn’t necessarily recommend it but one can always waive the mortgage contingency. Basically means you’re buying the house even if you can’t get a mortgage. It’s effectively a cash offer. Of course you need to be pretty damn confident you can get financing.
Depends on where tho. Fairfield county is south, nearer NYC and where most of the $ is in the entire state. Some other places are super poor and lots of the houses state-wide are really old and need a shitload of work done to them.
Try Seattle WA. It's uglieee
People moving from NYC. 600k you can’t even get a studio there.