Buying a house is not hard.
Yes, it's very expensive and should be done with intention and proper representation, but the whole process is navigated and completed by around 10 million buyers and sellers in the US each year.
But man, can it get complicated by buyers & sellers in the category known as “getting in their own way.”
They make up crazy stories that the other side is lying, hiding things, or conspiring to rip them off. Seeking and taking advice from all kinds of side players who have no idea what they are talking about.
The most common thing we see is panic over inspection findings.
“Everything can be fixed” was one of the best pieces of advice my mentor Leslie ever gave me. I usually add “cheaply by a guy with a toolbelt in a few days.” They’re all fixers, especially around here, where the average home is a century old.
But that doesn’t mean you can’t just use houses for what they are meant for. You know, living in. Most already have residents and are perfectly habitable. You wouldn’t know it from the parade of inspectors and their six-figure “estimates” for repairs that all are almost always unnecessary upgrades.
Remember, a house sale is a cooperative venture - everyone wants the same thing: for the sale to close at a price roughly around what was already agreed to. If not, both parties walk at little to no cost and try again.
Sometimes, you'll see a massive issue, and the seller will give a massive credit, but that is rare. And guess what? The seller had been living there in ignorant bliss and probably would have continued to not repair that massive issue had they not decided to sell.
However, in home transfers, these issues are put under a microscope and make everyone insane. Don't get caught up in this nonsense.
A house sale is not a legal battle or a fight—it's a purchase, like a very expensive pair of pants. You can decide it's not the right fit and simply walk away with little to no cost.
The good news is that once the deal closes, the actual issues are fixed, everything is forgotten and goes into a file, usually never to be seen again.
But the nitty gritty can prevent people from buying, and that’s a big problem.
We watched buyers walk 5 years ago over a $20k foundation repair, and that home is now worth $500k more (and still standing nonetheless). Not to mention all the mold “findings” when the walls are later opened to reveal no mold at all. And let me let you in on a little secret…the termites come back. 🦟
I get it. Money is expensive right now, and if you're spending $10k/mo to borrow $1 million, you don't want to be stuck with six figures in repairs.
But also, don't let the reports and minutiae prevent you from buying.
Lori always remarks that our success in real estate investing stems from the fact that we don't think too hard.
We recently bought a historic triplex that needs new electrical, HVAC, kitchens, and bathrooms (~$100k). We paid full price and got a $20k credit. Could we have gotten more? Maybe, but I frankly don't care.
Because at the end of the day, I know this truism: anything that anyone has bought in Northeast L.A. in the last 20 years, in any location and any condition, has tripled in price. That includes houses with termites, cracked chimneys, and knob-and-tube wiring…
Buying your house will take a month or two and cost a few thousand dollars, but owning it for decades will earn you millions.
Get the property. The rest will work itself out.
