Adam Kruse of The Hermann London Real Estate Group will answer some of the most frequently asked questions he gets as a realtor. Email your questions to [email protected] Subscribe to the St. Louis Realtor Podcast With Adam Kruse on itunes
1:19-What should a new college grad do?
2:24-How much rent should I charge a friend?
3:38-Should I call the number on the yard sign first?
4:10-Should I be worried about old houses falling down?
I’ve got a couple more questions to answer for you this week. Actually this week we have four questions and oddly enough they all came from one person, so I’ll call them Joe M., and Joe knows who he is. I’ll just start with Joe’s questions.
-He says, “I’m fresh out of college. Should I buy a house? Should I buy a condo? How do I know how much I can afford?”. I think he is also insinuating, “Should I also stay living with mom and dad? It’s free. Everything is great.”
Joe, I’ll tell you what, first thing you need to do is call a lender. We’ve had John Charlton on here a lot, answering all types of questions and that type of thing, but call a lender and kind of find out how much you can afford. My suggestion is you call him and you say, “Here is how much of a monthly payment I’m comfortable with,” and let him tell you how much of a house that is and make sure that they can give you the loan for that. Should you buy a house? Should you buy a condo? If we were to sit down and have our buyer’s consultation meeting, I would ask you a lot of questions, sort of leading questions that would let you figure that out. Both of them have different benefits. If you want to have a property to maintain and take care of things. Do you like mowing the lawn? Do you like fixing and updating stuff? Those types of questions will go into deciding if you should buy a house or a condo. Do you travel a lot? All this type of stuff. Let’s have a meeting and actually talk about that.
-“I have a friend that is going to move in with me. How do I know how much rent to charge him?”
That’s a good question. We get that a lot. I think a lot of people assume that if they are buying a property and they have a friend moving in they should split all the bills with the roommate. The mortgage is going to be $1,000 so they will have the roommate pay $500. If that makes you happy, I guess that’s fine, but to me it doesn’t exactly seem fair to the home buyer or the tenant because if I’m the home buyer and I’ve been saving money for the last ten years and I put down a 20% down payment on the property, well, then my monthly payment is a lot less. Why should my tenant/buddy, why should he have to pay less rent because of my saving for the last ten years. I had that second job. What we would encourage you to do is figure out what the actual fair rent in the area is and basically charge your roommate/friend that for your rent. Of course, if that’s less than what half your mortgage payment is then you should charge him half your mortgage payment, of course.
-Next up, “Do I have to call the sign that is in the yard?”
Well, Joe, I guess you didn’t listen to last week’s questions, did you. That’s okay. Do I have to call the sign that’s in the yard? No. One of the things that you’ll find when we meet and have our buyer’s consultation meeting is that we really don’t want you to call the sign in the yard. It’s best if you see a house that you like that you call your agent and that way I can get you information about the property. That way I can ask the listing agent any sort of questions that we might have and I can show you the property and you don’t have to deal directly with the listing agent at all.
-Last question. “I was looking at a house that was built in 1950. Should I be worried that it will fall down soon?”
It’s an interesting question. I never would have thought of that one myself. I guess I would say no. It’s not like a car or a furnace that eventually they have a usefull life. A house can last forever, essentially, if it is maintained properly. I actually showed a property a few days ago that was 194 years old. It was down in the Compton Heights area. 194 years old and it looked like it was in great condition. They had updated a lot of things. They updated the furnace, kitchen, and bathroom obviously. If a house is built in 1950 and nothings ever been done to it, you might be concerned that you might have to do some updates and fixes to it and maybe buy some new systems and that type of thing but it is not necessarilly going to fall down soon. It has just as much of a chance of falling down as a house built in 1900 or yesterday. We have to look at it property by property.
That’s all my questions for today. Thank you very much. Please don’t forget to submit your questions to [email protected] or just give me a call 3142105115. Thank you very much and take care.