My wife and I spent the better parrt of 3 years searching for the home that we currently live in. I'm glad we took the time. It has a gorgeous piece of land, in a nice neighborhood. The home is an updated colonial, and thanks to our savvy in getting some great incentives to update the boiler, has a brand new high efficiency heating system. We live in one of the best school districs in the area, and Sophia's grade school is literally in our back yard. It took us a long time to find it though, and we actually had three other homes fall through before we ended up landing this one.
Home buying is hard. Sure, there are plenty of options that one can take to ease the process. Zero down financing, Low money down financing, using hard money lending, Owner will cary....the list goes on and on. and we've explored all of these in our quest for the perfect first home for us. It is a little extreme how long we looked, but we wanted to leave a lot of wiggle room in the pruchase, and also make sure we got what we wanted. Unless you're pounding the pavement every day yourself and knocking on doors looking for a deal, finding the right house, at the right price, and making the right deal is a perfeect storm that really can take more than a year to formulate.
Let me spell out what I mean by that. Stef and I wanted a house that would a) put us in close proximity to her work in Pittsfield, a small city in the Berkshires. We also wanted to make sure we were in a good school system for our daughter. We wanted to find a house that was 90% finished, but probably needed some basic handyman stuff (the extent of my skill level with a hammer) and we wanted to buy this house at a price that would a) leave us at about the same or less monthly expense as when we were renting a home, and b) would appreciate in value reasonably over a 10 year period. We also wanted to make sure that the home would be one that we would be just fine living in for 10 years. This is a long, long list of criteria for a home purchase. I'm glad we waited until every one lined up, though. I wake up every morning in this house, look around, and just feel good about every part of owning this home with my wife.
Why such strict criteria? Well, if there is one purchase you probably shouldn't comprimise on, its your home. Now I don't mean buy the house with helipad and 5 swimming pools, I mean buy the home that makes sense for your budget, for your lifestyle, and one that makes sense (in some small way) as an investment.
Our journey in home buying was indeed long. We started looking for homes very much in the "starter home" level. However, I knew that we wouldn't be happy in these homes for 10 plus years, so I kept looking at larger, more established homes in better neighborhoods, but these homes always needed too much work (extensive mold damage, no heater, ruined roofs and so forth) and so most of our searches were in vain. We also found a few homes in these price ranges that were great. We would negotiate these homes into a price range we could afford, and three times we had three different sellers back out at the last moment. What an emotional roller coaster. It just wasn't working.
The funny thing is that we didn't realize just how much home we could afford until we took a long hard look at our expenses in the home we were renting. We were renting a cute little ranch house with a garage, and an ancient, incredibly inefficient oil boiler. Stef and I both had never had any dealing intimiately with heating a home, so we just thought the the exorbidant heating cost was the name of the game. My mother's home in Vermont had a similar heat bill (although her home was about three times the size) so I thought nothing of it. It wasn't until I talked with a few of my friends with experience in heating that I found out that spending $6000 a year on heat was not normal, and in fact was skewing how much home we could actually afford.
armed with this knowledge, I dove headfirst into searching for how to set up effeicient heating in a new home that we would buy. I found a great article on Mister Money Mustache (here) that explained how to effectively insulate your home. My wife found out about MassSave, whih is an incentive program funded by the local electric company. This program gives you rebates on boilers, zero interst loans, and even a very low cost insulaion sure up done by professionals. as we did the math and crunched the numbers, we realized that if we were able to use these programs, we could essentially afford a much bigger, better home.
Armed with this information, we went looking in a higher price bracket. We found a few, made a few deals, and eventually someone bit. Thanks to some help from Stephanie's parents, we were able to close on what was really our dream home in three weeks. we used our knowledge we gained in learning about how to heat efficiently to sure up the home, get a new boiler installed with a zero interest loan, and even put blown insulation into the attic to help with heat retention. I installed a whole house exhaust fan as well, which pulls the hot air out of the house in the summer, and kept us to using an air conditioner for about 3 nights this past summer. All in all, we "upgraded" into a house that is about twice the size of the one we were renting, and our monthly expenses are far, far less than when we rented. It was a huge win.
I can't tell you how much buying this house in a wise way changed our lives. It made us feel more financially secure. It made us happier because we own a home we love, and we enjoy caring for it, fixing up things that need to be fixed, and just staying in it for an entire weekend. It really has been one of the best financial successes that either of us have experienced.
If you're looking to buy a home yourself, I would recommend reading up on some of the ways the Mister Money Mustache recommends purchasing. (here)
There are also some great calculators over at Bankrate.com that will help you figure out what makes the most sense. (here)
If you're trying to find homes in your area, and you really don't know where to start, be sure to hire a realtor. They don't cost you anything, even when you buy (the seller pays both realtors) and will be a huge help in picking something that makes the most sense to you and your family.
If you're looking for a comprehensive overview on how to effectively buy your first home, you can learn more about the calculations that my wife and I used to do it best on her blog. (here) She'll be rolling out her new mini-course on how to buy a home soon.
Until Next Time Remember: Take your time, you'll live in the house you buy for a long, long time. Spend commensurate time searching and doing the math.
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