WWYD....Interested in your thoughts on a homebuying situation...

EMarieMe

Hi ladies,

I know some of us in the bay area of California have talked before about the insane housing market. Homes on the peninsula (between San Francisco and San Jose are going for $100-$300K over asking price in some areas. With a starting point of $650K it's not chump change, and you're basically getting a very, very modest home.

This one for example is going for $785K and is sliding down a hill, needing an estimated $300K in improvements.  https://www.trulia.com/property/3159138479-23-Chestnut-St-San-Carlos-CA-94070

So that's the set-up. My deal is that we are renting from family in a fair/good area and they are willing to sell us the home at a discount. We would inherit the lower taxes as well. Sound great right? Well, two doors down recently became a rental.   There are at least 9 adults (9 specific cars) and 7 children living in a three bedroom home. They are not loud or rude, but they are trashing the place. They've broken boards on the fence and their yard is full of garbage. Last week they put a microwave on the lawn, this week they've added a mattress.

I've looked up county laws and there's not stringent rules around how many adults can live in a house, and the few rules that they have are hard to enforce.  I'm also trying to be empathetic in that money is tight for a lot of Americans and mulch-generational living is becoming common again.

It's the garbage, and the destruction and just treating a home like trash that's bothersome.

One, have you ever been in a similar situation with neighbors, especially renters? How did it work out?  Would you buy a house in this situation? Remember how tough it is to get into the market here. This isn't our only shot, but it represents significant cost savings.

My plan for now is to get our retired neighbor on the case even further. He sits outside all day and is already annoyed that they take up the street parking and block the sidewalks almost constantly. I'm also going to try and see if we can get the home owners name and reach out in a "Not sure you are aware....." way.

Finally, am I in the wrong here? Should I care less about appearances of our neighborhood? I'm open to that, but it's just disappointing. My grandomther's family were dirt poor coal miners and had ten people in a tiny two bedroom house, but when you look back at pictures everything was always clean and tidy. They didn't have much but they treated it with pride and took care of their little home. 

Eager to get anyone's thoughts really! Thanks! I'll also probably show my husband this thread. He would never come here and read on his own, but I will show him this and wanted to disclose that to you all.

TiffanyBerry

I grew up in the Bay Area (San Jose) and lived in SoCal before moving and buying a house. I get the market. And, honestly, i would indeed go for the house you are in if you like it. Renters will change in 10-20 years, but you might well stay in your house that long.

And if double check on state laws and city codes. The vast majority of cities require minimum floor space per person living in the house, and they'd need a pretty large house for 16 people.

EMarieMe

Thanks you guys. A pros and cons list is a really good idea.  We're looking at it two ways, both as an investment to break into the market and maybe sell in a few years, but also as a possible forever home.

Buying a house sucks, but I swear it's just painful here.

Myaflowers

No advice to add, but my mind is blown at the price of a 3 bedroom home in your area. If we lived there, we would never be able to afford to buy a house unless we made about 5 times as much money as we make here. Yikes!

PB102012

Neighbors can make or break my decision, but the fact that they are renters means they aren't permanent (hopefully). We have irritating neighbors in back of us, and they own.

gwendarling

get it!

legalbeagle1

Does the house come with a good school district or could you afford to send LO to a private school? If so i'd buy it. I'm in Brooklyn and the stories I hear about SF real estate make NYC look reasonable in comparison. We just bought in a very crappy school district in an up-and-coming neighborhood and we are both attorneys who make reasonable money. We feel very lucky as rents keep rising and we know as our incomes rise and our mortgage stays the same we can afford to send L to private school.

JackoftheBox

I vote get it. The house next to us has a renter from his grandma and he cleand up his yard over the past year. Maybe they will to?

Ago

I would go for it. I live in a middle-class suburban neighborhood and have had this happen, right next door. It was really bad, but we moved in in August and that family is already gone. They were renting the house next door and the landlord was new and was being taken advantage of.  They have now replaced everything in the house and are selling it. The landlord had no idea, but if I would have had his contact info, I would have called him to let him know. You never know who your neighbors will be or how long they will last. I would consider the whole neighborhood, not just one set of neighbors.

PB102012

TarHeelMomToBe said:

There's no guarantee on neighbors.  Your renters could get evicted next month or some of your other  neighbors could decide to move the next month and someone worse moves in.

I think every neighborhood has their undesirables -- most people don't get to experience the worst until after they buy.  Sounds like the market makes it impossible to say no to.  What's the worst that can happen?  You decide that you can't stand the renters and sell for a huge profit?

I seriously hope for this.... ALL THE TIME.

EMarieMe

Thanks all for weighing in. It's not my dream house, but it could be really nice with some work. We have a lot to think about and consider. 

@legalbeagle1‌ the schools are pretty good, but one of the perks of one and done for us is being able to afford private school. Hopefully the Italian immersion school in the city if we can get in. 

@2013mommy‌, it's foundation work. The house is sliding down the side of the hill!

yvanehtnioj

Get into the Bay Area housing market any way you can. Even if these people stick around for the long term, you can eventually buy up & move on. But honestly, in a place like the Peninsula, the poor people are getting pushed out at an alarming pace and I doubt they'll be around much longer.

Our street has some undesirables on it as well. Too many, but we bought at the bottom of the market and it will be sooo much easier to buy up than try and get the nicer house first.

Unfortunately, in places like the Bay it's not even an option of "Should we hold out for something in a nicer neighborhood?" when you're outgunned by all cash buyers willing to overpay. Good luck!

arbutusbride

Agreeing with previous posters that eventually renters will leave. The odds are you will will out stay them.  If you know the landlord you could always contact him or her and keep them up to date on the state of the property if they do not live nearby. I'm sure there is something in the lease that dictates how many people are supposed to be there or at least proper care of the property (useless if there is no lease and they have an under the table arrangement). As a former landlord, I would want to know if my property was being destroyed. 

This is probably a good deal based on the market. (We lived in OC for about 7 years and understand the $$$ aspect.)