We REALLY lucked out in all of this. The houses in this neighborhood are appraising higher and higher. A friend's parents' house just appraised for $155k, from a real walk-through appraisal. They have a foundation crack that is going to be repaired soon, the walls just saw their second coat of paint in thirty years, and landscaping is not their strong suit. This house has been maintained just enough to keep it from falling over. They paid $80k for it twenty-ish years ago. Fortunately for them, it's all equity, as they had the place paid off quickly. His dad's overtime may have kept him from keeping the place up, but it did end the mortgage pretty quick.
This house was going to go on the market for $135k. For some reason, the fire that nearly destroyed it lowered its value. I learned of the fire, and the first thing I thought of was the fact that the roof is brand new. It is basically new construction. The only original parts of the house are the brick and the slab. All the wiring (which was the cause of the fire) is brand spankin' new, and very high grade. Very little of the plumbing had to be replaced, but what was replaced was done well. The only problem I have found was the cheap caulk in the shower. Somehow this knocked nearly thirty grand off the appraisal. Oh well!
It also didn't hurt that the previous owners were my great aunt and uncle. Mom asked my great aunt what she wanted for the place...
"Well, we're going to ask 135... but 115 if you want it." I think we paid $500 to have a lawyer draw up all the papers. No agent comission, a real simple title transfer, and a whopping downpayment (they asked for 2% down, we gave them 10% and got half the interest rate) secured this place for much less than we had anticipated. Mom is also really careful to "accidentally" send two extra payments each year.
Now take a drive North into Plano, some of Garland, and McKinney (really, even further North if you want). I don't like mcmansions at any price (unless I'm buying them on the cheap to rent out), but there are 2500 square foot houses running into the $300k range. We're talking an easy $250k for a 2500 square foot house with no yard, shoehorned in next to the other houses, no schools just yet, and a long way from anything at all. There is no rail up there (and knowing DART, my grandkids will graduate college before there's a train up there), and many of the areas are not yet serviced by decent highways. Much of this area is going from glorified goat paths to four-lane concrete very rapidly, which is just going to drive the already inflated property values higher. Much of this housing started on the back of the tech boom, so the developers are already eating it big time as the demand for this housing plummets. If I had some cash on hand, I'd be gleefully dancing around the Frisco area buying houses for the remaining balances, and just waiting for highway and commercial construction to drive the price up more. I imagine it would be an even better deal the day after the housing market collapses. A man with a few hundred grand could easily retire in five years on a plan like that.
