Home Buying in Raleigh>Question Details

Paul, Home Buyer in Raleigh, NC

I'm moving w/ family to N.Raleigh next summer. Is the area value up or down? Can I save if pay cash?

Asked by Paul, Raleigh, NC Tue Oct 12, 2010

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Paul,

Our market has been better than many across the country.
But, pricing dynamics are segmented within price range and geographic location around N Raleigh.
So, it depends on the sort of property and the specific N Raleigh location.

Paying Cash makes an offer look strong. It may or not save you money, but it certainly gets Sellers' attention, as they know they will not wait for a bank to approve a loan.


Before you talk too much about having cash, or other confidential information, read this publication from the NC Real Estate Commission. Among other things, it tells you to avoid disclosing info you would not want a Seller to know:
http://www.ncrec.gov/publications-bulletins/WorkingWith.html
.
.
Web Reference: http://www.MikeJaquish.com
1 vote Thank Flag Link Tue Oct 12, 2010
Value is a hotly debated topic and I only have one thing to say to that note and that is the individual deal is substantially more important than the overall macro question at this point. Overall I believe most of America will lose more in value but that doesn't mean I will on the homes I'm buying. Even if I do I'm in it for the long term 5+ years so I don't care about 2012-2016 except for rental rates and expenses. I wouldn't buy for less than a 5 year time frame though unless I was extremely savvy and had alternative methods for adding value such as tons of sweat equity.
The second part of your question is something I feel EXTREMELY strongly about though. Loan terms will NEVER be as good as they are now and will most likely be extremely bad in the next 10 years. Don't be surprised to see interest rates rise to 18% in the next decade as they did in the 80's. Hedge your cash against inflation and take advantage of an all time low 30 year fixed rate now. This alone makes the question of value substantially less important. In 5 years when you need to make a big purchase you can finance it for say a conservative 9%, or you can pay cash for it while only paying 5% on your home. DO NOT put more money down than you have to. You'll also be able to pay down your loan faster as inflation sets in one day. Lastly, you'll get a monster tax deduction with the mortgage interest savings. Its a no brainer...


Victory Realty 1135 Kildaire Farm Rd. Suite 200 Cary, NC 27511 919-249-8555
Serving the Wake County Raleigh Triangle Area, Cary, Apex, Garner, Morrisville, Holly Springs, Chapel Hill, Durham
0 votes Thank Flag Link Sun Apr 3, 2011
You have pretty much gotten your answer at this point, I would agree about the are being great and holding value. Would also agree to speak with your financial advisor. One thing that has been missed to to be sure that you are represented by an awesome buyers agent who can help you negotiate the best home for the best price. I would love to chat with you in person about your wants and needs. Please contact me. I have attached my website for your convenience.
Web Reference: http://www.kriscuddy.com
0 votes Thank Flag Link Tue Oct 12, 2010
We could negotiate and save you lots of money whether it be cash or not. The value will depend on the area in North raleigh and it could definitley change by next summer. Please visit my website at http://www.rayssatherealtor.com and feel free to look at some of the properties. I would love to help you and your family with your move to North Carolina
0 votes Thank Flag Link Tue Oct 12, 2010
Great question! You are coming to a great area, and you and your family will be happy that you chose the Triangle. For more general information on the area or to search homes in the area, please visit my website or contact me. We have a few different search options for buyers relocating to the area!

As for our market, there has never been a better time to buy a home! Interest rates and prices are at all time lows at the same time. I post information on the Triangle Market on my blog, and can send you the Triangle Market Overview which I put together each month for buyers just like you.

As for paying cash, it will put you in a great position from a negotiating stand point, but with interest rates as low as they are, I always suggest speaking with your financial advisor and/or accountant on the personal benefits for you. A quick closing with a reputable lender and a reliable loan program gives you a great negotiating position as well. The seller gets cash at closing either way.

Please visit the website for more information and let me know if I can send you the Total market Overview for the Triangle area. We are here to be your consultant and provide as much information as possible.

Best of luck,
Ashley Wilson
Wilson Realty Group, Keller Williams Realty (North Raleigh)
0 votes Thank Flag Link Tue Oct 12, 2010
Paul,

There are great deals to be had, but it requires a little more work finding the bargains around here than some areas. All cash should get you a good deal on something newer (if not new). I am of the opinion that some of the big homebuilders may have jumped the gun and thought we were pulling out of the financial mess earlier this year. As a result there should be some new inventory coming online next spring, and those may be favorably priced because I don't see the recession being close to over next spring.

One thought would be to pay cash and then puta loan on the property once you have it paid for.

Best of luck. You and your family will enjoy the area.

Regards,
Jeff
0 votes Thank Flag Link Tue Oct 12, 2010
Hi Paul,
The other agents have given you the info about prices and trends in the area. I agree with Mike about cash offers--it means it is a solid offer that isn't dependent on the bank underwriters. However, definitely discuss with your accountant the tax ramifications of paying cash, and the wisest use of your cash. I find that talking with a financial adviser and an accountant gives me both ends of the spectrum about the pros and cons of paying cash.

For example, I bought an investment property with cash to close quicker, then took out a mortgage. Dumb move, my accountant told me. This kind of mortgage doesn't have the same tax advantages as a mortgage taken to purchase property.

N Raleigh is a great area. Perhaps also talk to some lenders about financing 50% for 10 or 15 years, see what they say. Good luck, enjoy your options.
Web Reference: http://CrazyVivHomes.com
0 votes Thank Flag Link Tue Oct 12, 2010
You can save on the purchase price but you should really consider what you are doing prior to doing this. Rates are extremely low right now and you can find a savings account that has a higher APY than the current 5/1 arm. If you can qualify, get a loan, take the tax deduction, and put your money to work for you with your investment banker. There is no better time than now to borrow for a mortgage. If you just dont want the mortgage payment take the money, put it in an investment account, and have your mortgage payment drafted directly out of that account so you never see the payment.

Maybe I am a bit biased because I am a lender but with 5/1 arms below 3% and 30 fixed below 4% it just makes no sense to pay cash in my opinion.
0 votes Thank Flag Link Tue Oct 12, 2010
First of all may I be one of the first to say "Welcome to the Triangle"! We've been here 14 years now and have never regretted our decision to move to here for an instant.

I've included a link to our Wake County Market Report for your review to see how our market is doing for yourself. This market never saw a huge spike and hence never saw a huge dive. There are great homes on the market now and reasonable sellers.

As for saving when paying cash... of course you save the obvious in interest and perhaps would find a seller wiling to negotiate a tad better not having a financial contingency on the contract. A cash buyer always has a strong negotiating position. Be sure to work with a professional REALTOR® when your ready. They will guide you on securing your best position throughout the transaction.

Happy House Hunting!
Pamela
0 votes Thank Flag Link Tue Oct 12, 2010
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