Sage advice…

While I was vacillating over my home buying related decisions over the phone, my mother chimed in with some sage advice this evening. She knows me well enough to get that I’m nervous and twitchy about jumping back into the adventure of home ownership after getting caught in the 2009 meltdown. I was griping and complaining about the bills and fees that were hitting long before we even sat down at the closing table. Being who she is, mom has never shied away from asking the blunt questions, like “can you afford this?”

In the back of my mind I knew the answer. I’ve spent months crunching numbers and coming up with precisely where I need to be for the accounts to balance. I responded reflexively by ticking off the expenses that will go up, those that will go down, rattling through estimated fees and expenses from memory, covering the details of my good faith estimate, the downpayment, closing costs, and my best guess of moving expenses.

That’s when she reminded me that most people approaching 40 who run out to buy a family homestead are doing it on two incomes while I’m clawing it out on my own. A few years ago I’d have probably taken that as a sideways commentary about my lack of marriage and production of grandchildren, but we seem to be over that particular hump. Instead I took it as a reminder that I’ve basically always been a one man show – and even when it seemed that I was walking a high wire I’ve generally had the facts and figures on my side. Not to mention luck. There’s always been a healthy dose of that following me around.

Moment of doubt averted. Carry on.

Thanks mom.

Homestretch…

The last great negotiating feat of House Hunt 2015 appears to be at an end, with the seller agreeing to complete a list of minor and a few not so minor repair items prior to going to the closing table. As the hunting and gathering portion of this exercise draws to a close, I feel like I’ve extracted nearly every concession I could reasonably expect. As I mentioned to a friend this morning, if everything goes through closing as written I’ll be able to offset the loss from selling in Memphis and still have equity to spare in the new house. Home buying can be a significant emotional experience, but from start to finish I’ve been doing my best to think of this one as a business venture where the key motive is to capture every nickel of extra value I can lay my sticky little fingers on. There will be plenty of time to get emotionally attached once the paperwork is done.

With the meat of the negotiations wrapped up that leaves financing as the last hurdle to clear. I don’t anticipate any issues on that front, but I’m always a little nervous and jerky when someone starts poking around with years’ worth of tax returns, pay stubs, account statements, and a veritable laundry list of questions about what money came from which source. I know well enough from hard experience that it’s always the unanticipated issues that end up eating your lunch and that’s what’ll tend towards making for restless nights. Now that I’ve handed off every shred of documentation the mortgage company requested, I’m in hover mode until either they finish the job or they come back asking for more paperwork. I’m in a purely reactive holding pattern. Being a planner by both profession and temperament that leaves me hanging in a very uncomfortable spot. As much as I want to think I’ve accounted for the unexpected, I know very well that’s a happy fiction. After all, nobody expects the Spanish Inquisition.

For now, closing is just a mark on the way a little more than a month away. We’re well down the homestretch, but it’s still a hell of lot of distance to cover between here and there.

The right one…

Knowing I wanted to be out of my current rental by the time this year’s lease expired, I started driving around the county and nosing through open houses a few months ago. I was even more or less settled on the areas and type of house I wanted to end up with. I wanted more than an acre, something mid-century, and well outside town limits. For the record, December and January are probably not a great time to be out poking around looking at houses – there just isn’t that much of a supply on the market and no sane person wants to move in the middle of winter. Even so there were some contenders, but nothing that screamed “buy me now.” I bided Woodholmmy time, assuming that more inventory would arrive on the market with warmer weather. I even toyed with the idea of buying a big lot and then building a small house to suit, before realizing that I house built to my own crackpot specs would be damned near impossible to sell to anyone else.

The funny thing is I thought I knew exactly what I wanted. I’d only been working with my realtor a week when she casually mentioned that I should look at a house down on Elk Neck. It was an eyebrow raiser. Sure the pictures looked nice enough, but the house barely ticked off half of the things on my list. It was one story, on slightly less than an acre, and (terror of terrors) ruled by the covenants and restrictions of a very active home owners association. In fact I almost passed on even looking at it for those reasons until curiosity got the better of me. A house in that neighborhood rarely stays on the market long – and this one had been on the market for almost eight months and $100,000 in price reductions. Honestly, I assumed it was a murder house, or infested with mold, or possibly built on some kind of ancient Indian burial ground.

After the first showing, we were both utterly confused by why this house was still on the market. It was only during my second pass through the master bathroom that it occurred to me – uh, why isn’t there a shower in here? So there it was. The reason the typical yuppie buyers in that neighborhood had been taking a pass on what was otherwise a tremendous home. I proclaimed the design choice “very weird,” and moved on.

Three hours later the seller’s agent called my realtor using phrases like “extremely motivated,” “willing to negotiate,” and “credit for bathroom renovation.”

That conversation let to three days of back and forth discussion, deep research on bathroom renovation costs, another showing, and by the end of the week an offer I was sure would test the depth of the seller’s motivation to be finished with the property and move on with his life. There was a counter offer, a counter counter offer, and finally agreement of nearly all the substantive terms I asked for. I’m still a little shocked they agreed to all the concessions written into the contract.

It wasn’t the house I started out looking for a few months ago, but assuming it passes through the gates of inspection and financing it’s the right one.

Trip Report – House Hunting Day #2

Following hot on the heels of this weekend’s formal kickoff of House Hunt 2015, this afternoon saw another dash around the county to look at three more houses. I shall call them The House Next Door, The Revenge of the Tub, and the House Not Appearing in this Post.

The House Next Door isn’t actually next door. It’s at least 500 yards away on the other side of the street. Weighing in at 4 beds and 2 baths, this very well put together Cape Cod style home offered a touch over an acre, a two car garage, a large screened porch, and more storage than three of me could use. Aside from questioning whether one of the bedrooms really counted, it was a nice enough place. The house was solid. The kind of thing you’d imagine seeing if you told someone to draw a picture of a house. Even at an acre, the lot felt a bit crowded to the left and right. It’ll be a nice place for someone, but I don’t think it’s my huckleberry.

Sigh. The Revenge of the Tub. It’s beautiful. The kitchen is twice as big as my first apartment and is spot on in fit and finish. The whole house was simply beautiful, ticking off everything on my want list except for a back yard fence. It was perfection, right down to being structurally overbuilt by any reasonable standard. I’m pretty sure the current owner had visions of a basement bunker when he laid in the double thick poured concrete walls. With a good solid door you could hold over the zombi apocalypse in that place. The problem is, that like one of Day 1’s contestants, the master bath just has a giant tub situated beneath a bank of windows. If a guy wants a morning shower he’s got to schlep down the hall to the guest bath. It just seems ridiculous given the amount of money you’re spending and the fact that there’s a bathroom right there off the master. Then the issue of the Home Owner’s Association – who exercise supreme executive authority over everything right down to the location of exterior lights to the height of the fence you’re allowed to install. My innate western Maryland hillbilly resentment of anyone who wants to tell me what to do on my own property is maybe a bigger factor here than the inconvenience of going down the hall as part of the morning routine. Even with those reservations, the place is a serious contender.

The House Not Appearing in this Post is aptly named because the lock didn’t work so we weren’t able to do much more than eyeball the outside and peep through the windows. It’s probably for the best. No matter how well put together it was going to have a hard time standing up to the place we just left.

I’m sure there will be more to follow later in the week.

Trip Report – House Hunting Day #1

Saturday was House Hunting trip #1. There locations were on the menu – I’ve affectionally named these properties The Tub, Hill Climb, and Suicide Exit, respectively.

The Tub was a nice enough Cape Cod with 2 and 2. Needed some paint, some stain on the deck, and someone who knew something about yard work to take the place with a firm hand. I could have made it work well enough. The emphasis there was on “could.” Then there was the issue of the namesake “tub” in the upstairs bathroom – a tub that I can only think was ordered using “how big a jetted tub can we squeeze up the steps” as a planning factor. Not that I’m opposed to large jetted tubs. I’m just opposed to them when all other “conveniences” of the privy are relegated to afterthoughts and I’d need to trek downstairs and to the other side of the house every morning just to find a shower. Pass.

Hill Climb looked promising… on the map. I believe it was labeled as “on a bluff overlooking a creek.” What the description left out was that you’d have to have 4 wheel drive and willingness to follow a 30% grade dirt track to reach the house. Probably OK in the summer, but anything worse than a good frost would leave you stranded indefinitely. Pass.

Suicide Exit. Ah, the most alluring of the three potentials I wandered through yesterday. Curb appeal to spare, privacy, and a long stretch of creek in the back that eventually turns into the Elk River. It was exceptional – the kind of place I would buy if I were settling in to look for a place to fade into the twilight. Sadly, the musty smell of leeching water in the basement and damned near killing myself trying to back out of a blind driveway onto a winding country road are not insignificant or inexpensive issues to overcome. It’s a shame, really, because it was the kind of quirky post-war house I really like. For now I’m keeping it on the list because I’d really like to see the place when spring comes to Ceciltucky. For now, though, it’s a pass.

So ends the first day of house hunting. I’ll try to hit three more tomorrow afternoon if the light holds out.

In case you’re wondering, yes there are pictures, but I’m not feeling up to stripping out the geotagging information, so for the time being you’ll be forced to rely on your imaginations. It’ll be good for you. It’s how we use to do things in the olden days.

The search is on…

This little project to find a new and improved Casa de Jeff is beginning to get serious. How you know it’s getting serious is I’m altering the long-established Saturday routine in order to fit in meeting with a realtor and checking out a few potential houses. Between now and then I supposed I’ll have to firm up my list of must have options and the list of things I’m willing to trade away. Right now the must have list is pretty short – 1+ acre, 3 bed, 2 bath, and not in needing a gut-to-the-studs renovation. The willing to trade list includes central air, garage, and basically everything else. I like to think I won’t be picky or overly demanding, but I think we all know that’s a pipe dream.

Judging from the few places I’ve driven past to eyeball in the last few weeks, I’m slowly coming to terms with the fact that the dollar doesn’t stretch as far here in the Baltimore/Philly exerbs as it did in West Tennessee. I’m doing my best to adjust my expectations on fit and finish accordingly… on the bright side for you readers, very soon you’re going to be able to play along with my little game of taking pictures inside other people’s homes and wondering what the hell they were thinking with their design and decorator choices. That’s always a treat.

In the meantime, if I seem to get in too much of a rush, feel free to remind me that there is absolutely no timeline associated with reaching mission complete on this project. The plan is mostly to keep plugging away at it and hope I know it when I see it.

It’s like House Hunters in reverse…

One of the least entertaining aspects of moving is the fact that I’m about to be the owner of two homes that there’s virtually no chance of my ever living in again. That sounds ok at first blush. Property is property, right? The real estate market always comes back, right? Right? That’s not really the down side, though, as at least intellectually, I know that at some point in the future I will be able to sell at least at the break even point. The real kick in the teeth is that at least for the forseeable future (5 years under current laws), one of these houses counts as a pure liability no matter how good a money make it is as a rental property. It seems that the fine people who make the laws and implementing regulations have decided that rental income doesn’t count as real income (except for tax purposes) until it’s been actively rented for at least five years. What that really means is that I can’t use the rental income from the house here to help me qualify for a loan on a new house. Don’t worry, though. The government is happy to treat the those funds just like regular income for tax purposes, so they’ll be sure to get their cut. Awfully nice of them, don’t you think?

I’m pretty ok with needing to rent when I get back to Maryland. Alot has changed in five years and I’m not really an expert in the northeastern part of the state. Having some time to feel out the area is probably for the best. It would still be nice to know I’d be in a position to buy if the right property and the right price happened to come along. Not much chance of that. It seems mortgage companies are a little skittish these days about writing four mortgages on a single income. Go figure.

All on the home front isn’t doom and gloom, though. It seems the property manager I’ve hired has been doing strong work in the last few days. She called tonight with a strong lead on someone who is very interested in getting into the place as soon as I can manage to get my stuff out of here. Since it hasn’t made the listings yet, I’m hopeful that’s a good sign for getting someone in here and paying the bills quickly. The mortgage writers might not consider it real income, but their accounts receivable department will sure thinks it’s the real deal. That’s a box I’ll be extraordinarily happy to have checked as quickly as possible.