Reply to Buyers can't have it both ways

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]Houses in our area are selling like hotcakes. These are 1980-2000 built homes, most have been updated or at least cleaned up/staged to look as neutral as possible, and going off the market immediately since the spring. Our offer was super competitive (e.g. no contingencies offered with 12 hr deadline before open house) and accepted. The last house that sold was under similar circumstances (they haven't closed yet but our neighbors are friend with the sellers and loooove to talk). HOWEVER there is a house that has been on the market for four weeks, has had one price drop, and no one has bit. Why? Because the owners have done nothing to update it/make it appealing to millennials - it has granny furniture, granny colors (dark red accent wall, hunter green dining room, anyone?), brass fixtures, old carpet, you name it (the kitchen is actually pretty nice - white cabs, gray counters, stainless appliances). It's at a great price now, but no one wants to touch it because it would require maybe $25,000 worth of work to get up to date (really just paint and replace carpets and fixtures). I just don't get it - you can't have it both ways, folks? Can't complain there are no houses on the market, but then not buy a house that's a great deal![/quote]

That's 25k in cash and most people are very cash poor immediately after a home purchase [/quote]

This. Most Millennials don't have another $50-100K in liquid cash to fund a mini-renovation after closing on their first house. Downpayment and closing costs basically wipe out their bank accounts and they need to rebuild their emergency fund.

This was certainly true for us in 2017 when we bought our current house. We said we would do a full gut renovation in 5 years. Well, it's six years later and we have a lot of cash saved up, but that full gut renovation costs 2x in 2023 compared to the cost in 2017. And now we have enough to fund a downpayment on an investment property, so we are just sitting tight right now.

So yeah, Millennials would like turn-key because they can "pay" for the cost of the renovation via their mortgage loan. The options are $100K in capital out-of-pocket to fund a renovation vs. $12K via 10% downpayment and add another $120K to the mortgage. In other words, they'd rather take a bigger mortgage to pay for it as they don't have the capital to fund it themselves. [/quote]

I get the impression that most people on DCUM have their parents helping them buy the home, so they aren't as cash poor as you'd think.[/quote]

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