patrick.net

Agree about the extra bedroom(s) as a backup plan. The banks/investors/whoever can't hold onto the short sales and shadow inventory forever, I will get my next property probably within the next two or three years and I have a feeling it will be a nice one!

I've driven through DC and its environs once. That experience alone was reason for me to not ever consider living there. I've NEVER seen traffic that awful.

if you've done the math on it, and it's a good deal, then go for it.

but do you really need THAT big of a house? look how much empty space is in those pics. seems a bit too extravagant, and possibly wasteful? that place is gonna cost a fortune to heat, too.

If you can sub divide the property it wouldnt be bad . If natural gas is available its worth the money , dont go with propane , the company will own you . Thats awful big house , I am a contractor , with something that size "you can afford it" So be ready for $1000.00 leaf clean ups , $150.00 per cut mowing , all electric on heat and air , I have seen $2000 a month on heating with heat pumps ( I am in annapolis) I would offer them $ 510,000 and play the game when they counter drop your offer 20K see what happens

Looks like a dump.

being in bay area, I can only DREAM of a house like that! damn!!

kapone says

Lemme stress it again - I'm NOT sold on this one. However, I'm seeing it and seeing "some" value in it. And that's the issue. Am I reading the numbers right or not?

I don't know what houses go for in Gaithersburg these days, but on that house the price /sq ft seems pretty cheap to me. Either that of it's cheap because almost nobody wants something that big. I mean isn't a normal sized house about 1/2 that price in that area?

You should be able to easily walk to the MARC station from there too. That would be a good selling point if you wanted to rent out rooms.

I've passed right by that neighborhood hundreds of times, but never entered it. I can not imagine that such huge houses would be there. If it helps I had natural gas when I lived in Gaithersburg (at Summit Crest Apartments) so I know it's at least in the area.

kapone says

So, the more important question is not that the house is too big, the question is, is this particular house priced "right"? There will probably be others like it, and I want to make sure we have a "baseline" on which to make a decision.

I think this questions is too open-ended.

First, in these times, there is really no way of knowing if this price (675k) is right. What is right today may not be right a year or 5 years from now. There is no guarantee that you can sell it and break even - EVER. I'm sure the previous owners felt that 1.1mm was "right".

Second, the price of a house is more than what you pay for it up front...it's the cash flow (maintenance, taxes, etc.) and the value of that cash flow. That's what everyone is suggesting here. In most cases, you can't really separate the size of the house from the price of the house.

Third, I believe you said this was an emotional decision? The house is well below what you can afford. Based on your first couple of comments, I have a feeling that you think you are getting a million dollar house for 675k, and that is a big part of your motivation.

Personally, I would rather spend a million on something I need, rather than $675 on something I don't.

Offer $600k.

They accept .. buy it.

Well the property taxes alone are $12,777 a year, that's over $1,000 a month. Something to consider.

What really concerns me here is heating /cooling costs. It says the heating system is electric, which is the most expensive method of heating there is. It also says the master bedroom has a gas fireplace. If Natural gas is available for the bedroom, why not the rest of the house? I'm going to guess that there is NO natural gas Available for this location, the bedroom gas fireplace runs off of propane which is marginally better than electric heat. Also two wood burning fireplaces in other rooms, this tells me heating this place will be a nightmare in the winter. There people who spend $600 a month in New jersey heating houses that are not a 1/3 this size and Maryland pretty much has the same weather New Jersey does. Unless you willing to wall off most of the house and live in a few rooms during the winter months, I say your looking at a least $1,500 to 2k a month in heating costs during the coldest winter months.

Based on what I see, I recommend against buying this house. Unless you going to pay to put in Geothermal (at least 100k for this size house) heating and cooling bills are going to kill you.

dex248 says

There is no guarantee that you can sell it and break even - EVER.

I think the housing bubble has seriously affected your ability to form logical thoughts. The Housing Market WILL recover, eventually. Weather it's 5, 10 or even 20 years down is anyone guess. To believe prices will go down forever or stay flat is just as delusional as people who thought prices would always go up during the bubble.

Why are you posting this? Your wife is going to decide whether or not you buy a house. Cut the baloney we're adults here.
You're gonna buy something and the question is whether it's this one or a "cheaper" one. Guess what? She wants the biggest one you can get.
Oh, and I bet she runs around telling people this is 10,000 square feet. Has a nice ring to it.
When you DO buy a house it's gonna be on your shoulders because she can't both work effectively and care for infants. Oh, there's child care. Yeah, and that is like paying another mortgage.
Buy the nicest, cheapest, smallest house you can stand. This will discourage you and your wife from filling it with a bunch of expensive junk too.
She won't agree so I just wrote that for the hell of it.

It seems from your replies that you're in love - with the house.
Buy it and find out.

I'll tell you that we bought our house twenty years ago and it was pretty big. Not as big as this one but good-sized for the Bay Area. As we have aged, (you will too) I have come to appreciate why people downsize. Big time! Maintenance, roofs, rot, defects, count me the ways in which one can be surprised and I will tell you tales.

You'd better be really committed.

permanent_marker says

being in bay area, I can only DREAM of a house like that! damn!!

This is what everybody *thinks* they want. But after reading some of the responses. I think I'll stick with my 1200sqft bay area house but I'll take the 1.8 acre lot.

TechGromit says

I think the housing bubble has seriously affected your ability to form logical thoughts. The Housing Market WILL recover, eventually. Weather it's 5, 10 or even 20 years down is anyone guess. To believe prices will go down forever or stay flat is just as delusional as people who thought prices would always go up during the bubble.

How about 50 years? More than likely, he (and I for sure) will be dead by then. Will house prices have risen enough by then to cover the cost of selling? If not, maybe his kids can sell it at a profit during the next bubble.

6 Bathrooms

It would be nice to have all those bathrooms,in a bad case of Diarrhea!!.

Best Regards

Another similar home shows such homes were selling for mid $350K or so back in 1997. Apply the Shiller doctrine regarding inflation, i add in 50% at most and would say around mid 550K. So it seems there is plenty of downside left.

Property History for 20712 DELTA Dr
Date Event Price Appreciation Source
Sep 08, 2011 Sold (Public Records) $760,000 -3.5%/yr Public Records
Aug 31, 2011 Sold (MLS) (Sold) $760,000 -- Inactive MRIS #MC7595135
Jul 21, 2011 Pending (Contingent (No Kick Out)) -- -- Inactive MRIS #MC7595135
Jul 09, 2011 Price Changed ** -- Inactive MRIS #MC7595135
May 09, 2011 Delisted * -- Inactive MRIS #1
May 07, 2011 Listed (Active) * -- Inactive MRIS #1
May 06, 2011 Listed (Active) ** -- Inactive MRIS #MC7595135
Sep 13, 2007 Sold (Public Records) $875,000 6.2%/yr Public Records
Aug 24, 2007 Sold (MLS) (Sold) $875,000 -- Inactive MRIS #MC6407216
Jul 20, 2007 Delisted -- -- Inactive MRIS #MC6407216
Jul 18, 2007 Relisted -- -- Inactive MRIS #MC6407216
May 12, 2007 Listed ** -- Inactive MRIS #MC6407216
Jun 24, 2003 Sold (Public Records) $679,900 10.9%/yr Public Records
Dec 04, 1997 Sold (Public Records)
more info . $383,500 -- Public Records
Dec 04, 1997 Sold (Public Records) $383,500 0.0%/yr Public Records

what is this Shiller Doctrine. very house across the US is supposed to appreciate at the exact same rate. So 1 acre in Detroit = 1 acre in Manhattan right?

clambo says

Why are you posting this? Your wife is going to decide whether or not you buy a house. Cut the baloney we're adults here.

Man, this is damn painfully straight forward. Of course, we just don't know this is the case or not, though it is the case for many.

Utility/heating/maintanance can be a serious issue. I can rarely see houses from past decades fully insulated. The heating/cooling cost can get ridiculously high. I am talking about over $500/mo in the winter times. But, it seems like he is aware of all those cost issues and willing to take them. He earns a lot, drives big 7 series Bimmer. So, let him deal with them, if that's what he want to go for. As you know, I am freaking bearish and cheap as hell. But in this case... :)

permanent_marker says

being in bay area, I can only DREAM of a house like that! damn!!

I can show you few picture perfect, calender worthy sort of absolutely gorgeous SFH. For example...

http://www.redfin.com/MD/Thurmont/13304-Jimtown-Rd-21788/home/17464987

What do you think? It's only 530K. Dirt cheap, isn't it?

But, I'd say they're for wealthy retired, or for your eyes only. Maybe you can go buy it if you love to fight a bear, going to fox hunting or being chased by a herd of deers.
About that particular house, I wonder if you still remember a movie called blair witch project. This is that kinf of area. Actual blair, burkittsvile MD is 15 min driving from the house. :)

clambo says

Why are you posting this? Your wife is going to decide whether or not you buy a house. Cut the baloney we're adults here.

You're gonna buy something and the question is whether it's this one or a "cheaper" one. Guess what? She wants the biggest one you can get.

Oh, and I bet she runs around telling people this is 10,000 square feet. Has a nice ring to it.

When you DO buy a house it's gonna be on your shoulders because she can't both work effectively and care for infants. Oh, there's child care. Yeah, and that is like paying another mortgage.

Buy the nicest, cheapest, smallest house you can stand. This will discourage you and your wife from filling it with a bunch of expensive junk too.

She won't agree so I just wrote that for the hell of it.

Clambo, that was hilarious.

Let's see. First of all, I think the place is tolerable on the outside, but pretty repulsive looking on the inside: very 80s. However, that is a matter of taste.

I agree with Thomas Wong, that there is a big downside to the price of this place. I'd put it at 550k if things stay relatively normal, and a LOT LESS if things get worse.

Why do you assume that your job is so secure? Just curious. A lot of people who though their jobs were secure, are finding otherwise. Also, I also agree with Clambo that the odds that your wife will want to keep working once you have a kid, are very small (and I'm female).

Gaithersburg has a surprisingly high crime rate (check the Sperling's Best Places website). If I were a burglar, that place would be very appealing. If I were a home invader, ditto.

Expect taxes to skyrocket. Sorry, but homeowners are sitting ducks.

It sounds like you and your wife are better prepared for Monster House living than most people (esp. the fact that you're handy). And w/loads of relatives around, you'll get more use out of a big place than most people would. However - remember that many of your *neighbors* who live in 6 bathroom houses are NOT handy, and won't have the money to keep their place maintained. Being from New England, I can tell you of many Monster Houses of years gone by (Victorians, Edwardians, Colonials) that has fallen into disrepair because they are just too big to deal with. YOU may be able to deal, but if your neighbors can't, that's a problem.

Hey folks, don't get so hung up on "10,000" square feet.

1. Older houses like this have a lot of "dead" square footage: long hallways, too large laundry areas, stairway landings, etc. Look at the area dedicated to front entry - not an inch of it is "habitable".

2. Bedrooms tend to be smaller and closets are smaller. (Though the master in this house appears to be a good size with good size bathroom.)

3. The basement is the biggest offender. It looks like a clinic - no finish, no clearly defined spaces - just raw footage which most often ends up as storage and a place for kids to thrash.

Determine the "habitable" square footage and crunch some numbers with it.

Also, take the largest square footage comps, develop a dollar-per-square foot value and determine what this house would be worth if it were only as big as the biggest comps. Any square footage over that should be treated as an amenity - like a pool, extra garages, outbuilding, etc. - attributes that make the house attractive to you but don't carry the value of the habitable space.

Thanks for listening.

SFace says

Notwithstanding that 75% of the Sq ft are useless>

Probably more, until they pop out a few junior tyrants to tear ass around the shack. Think Danny in The Shining.

What's weird is that in my experience, those desirous of houses with wings are rarely *into* anything. They never have amazing libraries or interesting collections of anything. It's either all about entertaining or big for bigs sake or the whole thing is an elaborate front for their alter egos; think Batman.

as you will spend 90% of the time in the same 1000 sq ft, I can't imagine how I will feel sleeping at night when the spouse have to travel overnight for business.

That's actually a good point. Hell, 1250 sq ft can feel positively cavernous when your wife's out of town.

It's interesting. People who live on the west coast forgot or don't know how expensive heating big houses is on the east coast, or cooling them for that matter. Yeah, it's hot down there in summer, ugh.
The property taxes are likely high.
I remember a couple summers ago watching a guy write a check for his utility bill for his big house, it was just $1100.

toothfairy says

what is this Shiller Doctrine. very house across the US is supposed to appreciate at the exact same rate

That is what history has shown us. That is the conclusion made by Robert Shiller. Even today in SFBA the Shiller Doctrine has been proven correct.

Guys, all of your concerns about heating and cooling a house this size are valid.

1. If we think of springing for this one (which certainly is not a done deal), the heating will be converted to natural gas. I confirmed with National grid yesterday, that the street already has gas, it just needs to be run to the house, and the necessary modifications to the house systems itself. I estimate $20K for this.

2. Yes, the "look" of the house is a bit 80s. That can be a good thing and a bad thing. Most importantly the ceiling height on the top floors is not 9 ft, it's more like 8.5ft whereever there isn't a cathedral ceiling. That bothers me. I'm big fan of high ceilings. However, the house does have a "charm" to its inside, that is difficult to describe. I guess the word I'm looking for is "homely"?

3. The property is not subdividable and probably will never be.

4. As far as the space goes...well, my wife has always wanted a "studio" to do her stuff in, we plan to have a big home theater (have a relatively small one right now, and the home theater kinda ties into my business), a decent library (between the two of us we have over 4000 books...we read a lot :) ), and she loves closets. So, one of the bedrooms will probably get converted into a closet.

5. As far as "affording" it, I have my own software company that I started a few years ago (and is doing relatively well), and my wife has a relatively high profile finance career. We could easily afford twice the price of this house, with just one income. The point isn't affordability, the point is "value". That's the whole reason, we have been renting for the last few years... :-)

These are random thoughts, not necassarily in any particular order.

All that being said, am I "sold" on this house. No. Do I think the market can fall even more? Absolutely. However...keep in mind (but that's my assessment as such), I do not see interest rates going up anytime in the near future. The US cannot afford it, as the USD will rise if that happens, and that's really really bad from the policy makers' perspective. They won't let it happen.

So, while I completely agree with the perspective of buying when prices are "low" and interest rates are "high", it just aint gonna happen anytime soon. Look at Japan, 20 years and counting, and the interest rates haven't gone up.

So, at some point we'll have to just make the call and buy "something". Whether it's this one or not, remains to be seen, but I can assure you, it's always going to be a relatively big house. I don't even look at houses that are less than 3500 sqft on the top two levels. That's just us.

Sorry, for the ramblings, I'm just trying to give some perspective here.

seaside says

About that particular house, I wonder if you still remember a movie called blair witch project. This is that kinf of area. Actual blair, burkittsvile MD is 15 min driving from the house. :)

You obviously are not familiar with DC area traffic! It would take a half hour even in no traffic.

clambo says

It's interesting. People who live on the west coast forgot or don't know how expensive heating big houses is on the east coast, or cooling them for that matter. Yeah, it's hot down there in summer, ugh.
The property taxes are likely high.
I remember a couple summers ago watching a guy write a check for his utility bill for his big house, it was just $1100.

I know someone in Montgomery County who pays utility bills that I think of as equivalent to rent.

kapone says

the heating will be converted to natural gas. I confirmed with National grid yesterday, that the street already has gas, it just needs to be run to the house, and the necessary modifications to the house systems itself. I estimate $20K for this.

Is the cost for a new furnace included in that 20K figure for natural gas? That's going to be expensive as well. Even more if you have to put in ductwork. Stuff like replacing the water heater and other appliances can be done later as needed (like when the stuff needs to be replaced anyway). I'd be getting estimates. Just make sure that natural gas piping is run for it with appropriate shutoffs, or at least a branch for any future appliances.

Pet peeve, buy my house had no natural gas shutoffs except for the main when it was built, and for some reason nobody bothered to add any over the course of more than 50 years, except for one for the furnace.

I just looked at the posts a little bit again.
"it's not in the worst neighborhood" This doesn't sound like a great endorsement.
Electric heat? You should just pile dollar bills and make bonfires in the living room for heat in winter.
Property taxes, the gift that keeps on giving and will be going UP because you mentioned the neighborhood is not that great.=welfare people lurking and they need social welfare services.
Home theatre, "studio", install gas heat, install furnace. install heat pump and cooling/heating ductwork? Another zillion dollars.
Daycare and wife quits work, a zillion dollars.
Kids enter school and wife won't go back to work after life as a soccer mom: battle royale, which the man loses. Gazillion dollars.
Yeah, this is really looking good to me :)

Stuff a towel in it.

You don't have to insulate or heat the whole house. For the rooms that are not yet used, are never occupied, or are used so briefly they don't require heat - just stuff a towel in the ducting and that heat will go where it is wanted.

I need to move to wherever this house is, if I can get this much house for the $! I would concur on potential hi heating costs (heated swimming pools don't heat themselves for free, unless a solar thing is in place), is the HVAC multi-unit or zoned so you can heat/cool and do so efficiently only in the areas you want to.

By my local standards, I would say "needs updating" in kitchen and bathrooms - don't like that crazy wallpaper in one of the bathrooms - but for other it may work as is.

If you are moving from a substantially smaller place, concur that you will be spending a lot on new furnishings.

Overall, I like it, and your comments show why the strictly monetary rent vs buy calculators can't be used in isolation from other factors.

Sounds to me like you can afford it, you want it, you have cushion money for repairs and improvements, what else is the point of earning money? To squirrel all of it away for a rainy day and meanwhile not enjoy life?

PS - What the heck is a "public septic" and if it has that, why is it also listed as having "public sewer"?

A well built septic system should be problem free. I have not had mine pumped or serviced for over 26 years which included a house full of kids...

OK, but yours is a private septic tank, right? What's a "public septic" as per the listing info.?

kapone says

The point isn't affordability, the point is "value".

Well if you don't find value in your own Happiness, than no price is worth it. You're a prisoner of the times, and you can afford to just thumb your nose and just treck on, and catch it on the upside. Years down the road when you weren't paying attention, and the house grows equity. When it does or if it does. The point is, you have dreams and desires to have your own spaces, and the room to do and have things, you either may or may not have had in your life.

You're not getting any Younger, unless your purchase could jeopardize you in the future and put your happiness at stake. Then you shouldn't even sweat the value, the media and economy puts on the place.

There's phrase that used to pertain to business. "The cost of doing business. "

Now I say, something is "The cost of NOT doing business. " more often than not, I find more value in that price.

You don't have to buy at the TIME the market hits bottom to get the BOTTOM PRICE.
1. Develop a simple, documented, and illustrated argument supporting the "fact" the local housing market will fall X% more in X months.
2. Show them how to this day their asking price has chased the curve down and they will continue to do that.
3. Quote the real problems of people bailing out of escrows because of appraisals and because of buyers not wanting to jump on a sinking ship.
4. Offer the best possible price they could get at the BOTTOM of the market.
5. Help the seller see that the beating you are giving them will be offset by the beating they are going to give the seller of their next home.

Make yourself a valuable buyer:
1. Express open love for the house.
2. Convey a true determination to raise your family there.
3. Demonstrate your grasp on the real estate market and the tools you used to arrive at a fair value for their home.
4. Point out if they keep the house, the problems you have pointed out become their problems and they will all be cash expenditures.

IF the price stalls higher than you want, put money back in your pocket by structuring the purchase to your advantage. Sometimes the price is a number needed to satisfy an agenda you are not aware of.

A few cosmetic deal enhancements:
1. Have them carry a second trust deed that waives X months of payments.
2. Have them pre-pay your taxes, insurance, etc. Up to a year is OK.
3. Reduced real estate fees.
4. Close escrow at a time best for them (over a holiday weekend, after the school year ends, etc).
5. Etc.

(When I bought my current home the seller carried back a $68,000 second. Interest accrued but payments were waived for 18 months followed by 18 months of less than full interest payments (you can't do that now with conventional financing). When I went to refinance the house I found out he had assigned the note to someone he owed money to. That guy was ecstatic when I offered him a $57,000 payoff).

Finally, quantify the results of over paying. Say you over pay by $30,000.
How much of that did you recapture with deductible interest?
Buying and contracting home improvements now when prices are down?
Having time to do work now when your career is not at full speed?
Etc.
While rates are down.
What's your time worth. Be done looking. Not another day with a GPS and digital camera ferreting out properties.
Amortize that over 10 years of ownership and it is a relatively modest "mistake".

Turn off this opinion machine and go to work getting an offer approved!

kapone says

The 6544 sqft is only the top two levels. It has an almost 4000 sqft basement.

That is physically impossible. Are you saying the basement is LARGER than the top 2 floors? Assuming the top 2 floors are indeed a combiend 6544 square feet, that means each floor is 3,272 square feet. Yet the basement is 4,000. That is physically impossible.

If anything, the basement is SMALLER than the upper 2 floors since there is likely no basement under the portion of the house with the 2 car garage. So considering that the average 2 car garage is about 400 square feet, that means the basement is no bigger than 2,870 square feet.

Only once in my entire life have I seen a house with a basement under the garage. And the only reason that was possible was because the house was built on the side of an extremely steep hill.

And then the 2nd floor does not extend the whole width of the house, looking at the picture. I have no idea what the actual square footage of the house is, but 10,000 square feet is grossly exaggerated. It is likely no more than half that much.

Kapone,
What ever came about with this house? Just curious if you ended up getting the house?

Capitalism is broken.

It should be priced at $5 millions.