First forays into homebuying
June 14, 2013
“We have to get this guy a house.”
Back from our various vacationtimes, we immediately saw that, while Doggle was thrilled to see us, he was also happier, peppier and more engaged than ever before. He’d been hanging his shingle in a house with a yard, kids and other pets for a week and amid the shameless spoiling, it was clear that he’d been taking dog lessons from someone.
Apparently the quiet life in a small apartment with DINKs doesn’t quite inspire the still-reticent Zendog to come out from his shell and do a doggy dance, or dash around happily pouncing on his toys four times a day nearly so much as the chaos of a full house does. It’s probably too much to hope that he’d picked up the notion of catch, but we actually have hope now that he might try.
So are we serious about getting a house for the dog?
Well, we’d been kicking around the idea of buying a house for some time now, and we designed our budget this year with a specific goal to save for a new down payment. It does feel like providing a yard is the next best thing we can do for our beloved Doggle. And yes, we want it for ourselves too, but let’s be honest, we’re doting parents and the dog is our happy excuse for a lot of things.
But … real estate around here is absurd.
Early explorations of Zillow and Trulia revealed real estate listings that are literally jawdropping.
We’re planning to stay outside the city. Many 20 and 30-somethings may find it appalling that people would actually prefer suburbs to the bustling city, but it’s true of us. We love visiting the city but it doesn’t feel like home to either of us. Between the traffic, the lack of (free) parking, the tight quarters, we’re just not city people. And with the tech industry out here, and the salaries they pay, we couldn’t afford the city if we wanted! So, y’know…
We’d like to be within fifteen or twenty miles of the city for reasonable commutes, which also suits my need for a warmer microclimate, so that was our first search parameter. We’d definitely be paying more for the luxury of better weather and saving time on a daily basis. If we were willing to be in say, Hayward, where I know the weather is as hot as even I would like, prices would be far closer to reasonable. But the compromise is better weather for me, not great for me and utterly crappy weather for him. For this, we shall pay.
We’re looking for at least two bedrooms, we’d really like two bathrooms and a two car garage, and a decently large kitchen is important to me. If there was a room I could start converting into my own private library (The Dream), that’d be the best but I will settle for a good amount of wall space and storage. We have no storage where we are now.
Last, PiC is reminding me to keep searching in specific areas where the schools are better. Which is sensible, this may be where we stay for a really long time. It needs to be a pretty safe neighborhood with some staying power. Which also means we probably should look at more than 2 bedrooms if we’re going to have any spawn. I grew up in a small 2 bedroom apartment but as an adult, I don’t really want to do that again, albeit from the other side, if I don’t have to. It might be character building but I’ll find another way to impart that.
Search results: moderately horrifying
We’re finding one and two bedroom, one bathroom, one car garage single family homes in moderately close/decent neighborhoods are starting at A. Million. Dollars. Seriously.
This shouldn’t be any surprise when in some neighborhoods, $800k hardly gets you more than a two bedroom, x bathroom(s) condo or apartment.
And three bedroom, two bathroom with garage SFHs run more like 700K-3M.
The estimated monthly payments on those homes that are 3k-7k (in more extreme cases) are almost beside the point. I’d only feel comfortable to committing to a new loan if we had 200K in cash with a healthy uncommitted cash flow. We do not have 200K in cash.
We could make a pretty good run at it but it’s not going to happen overnight and as much as I fantasize about taking another job, that’s not going to happen either. Freelancing, maybe. A whole other job would be crazy and crazy-making.
Making it happen
We still hold hope this can work and maybe even in the next year or so. Not that I expect the market to get much friendlier over the next year, but we have steps to take to increase our buying power, and reduce our stress.
1. Reduce our current fixed expenses, including the current mortgage to make a significant dent in the down payment goal. We’re refinancing and going over all the other expenses to trim back.
2. Keep those fixed expenses low – I don’t want to commit ourselves to either too much house (payment) or too strict a budget. After nine+ years of living on a shoestring income to debt ratio, I refuse to find ourselves coming up empty on cash for the sake of a house.
3. When we get a decent cash cushion in place, I’ll focus on foreclosures to see if we can’t stretch our buying power.
4. Hope hope hope that mortgage rates aren’t abominable twelve to twenty four months from now.
It’s time to dig deep and turn on the saving engines again. It’s not worth cutting off our allowances, I don’t think, since it’s not much per month anyway, but I’d love to pull back a little bit everywhere.
::What else should we be doing?