Life!

It’s rather interesting how quickly your life plans can change and I came to realize that in a big way this weekend.

My girlfriend and I went for a walk and took the long way to the grocery store afterwards to enjoy some of the views of our beautiful state and also to get a gym(Pokemon Go – we’re nerds).

On the way there, my girlfriend noticed an open house sign on a cute little road in a nice neighborhood and we decided to stop by to take a look.

We had talked about home ownership in the past and I’ve talked about it being in my future on this blog as well but I always thought that future was pretty far off. I love the comfort and low stress of apartment living. My apartment is in a nice area in an excellent town that’s about halfway between each of our places of employment so the convenience is there as well. It’s expensive but brand new and efficient and safe and I was expecting to stay there for at least another year. My lease is up in September and the plan so far was to renew.

We’re super picky and both assumed it’d take us forever to find a house when we seriously start looking and do note that we weren’t even looking at this point.

The little blue house with the open house sign was just something to do to kill time on a Sunday afternoon. We’re both big fans of the HGTV home shows(even if they’re staged) and enjoy looking at open houses from time to time to get an idea of what’s out there on the market for when we actually start looking and that’s why we stopped and decided to take a gander.

We pulled over, I checked Zillow to see if the open house was still in progress as it was later in the afternoon and there were no cars in front and saw that we still had about 10 minutes left before it was all done.

The area is cute, one we drive by quite a bit although it’s in a town I hadn’t really considered too seriously as a potential area for purchase due to the high taxes and generally high prices. Still, it was worth looking and this house fit our budget even if the taxes were a bit higher in this town than the surrounding areas. Plus, we weren’t seriously considering being home owners at the time anyway so what did it matter?

We walked into the house, met the nice listing agent and pretty much fell in love with the place.

In the past twelve months, we’ve probably been to at least a dozen open houses, most of which were more expensive than this one. Most of them were also complete crap.

We’re pretty critical and also don’t want to spend more than $350,000 on a house and in the northeast, that generally doesn’t buy you much so we thought we were in for a long painful process which is why stopping at open houses every once in a while would help in setting our expectations for the future.

The cute little blue house was listed for $339,000, didn’t require a lot of work and was the perfect size. The house is set back from the road so it’s quiet and has enough yard for our dog but not too much so that it’s a hassle to mow. It’s an old home(1950s) but has plenty of updates and we didn’t see anything specific that we’d want to change right away aside from some ugly carpet(there’s hardwood below) in the upstairs bedrooms which wouldn’t be a big expense/hassle.

The decor and appliances weren’t all brand new or super hip but they fit our style. The basement was partially finished and there was enough space in the home beyond the bedrooms and living rooms to set up an office for myself and an art area for my girlfriend.

The house also has lake rights to a lake that’s one street behind the house although there are some costs associated with becoming a lake member and it’s probably not something we’d take advantage of in our first year.

There were a few things we didn’t like. I prefer gas over oil and this has oil. The appliances are a bit old and will need replacing eventually, the bathrooms are fine but I’d probably change the shower in one of them and we’d need to install a fence but those are all things that can be done eventually. The truth is that beyond the carpet removal, we wouldn’t have to do anything to the house before we moved in and live and then we could make other changes in a few years or as stuff broke.

The other big negative for me is the property tax which is almost 10k/yr but unfortunately that’s common in the northeast. There are towns around with lower mill rates but houses like this one would also be 30% more expensive in those towns so that’s the trade off we would deal with.

My current rent is about $1800 so paying 46% of that just in property taxes isn’t too appealing but I also get double the space which my girlfriend is very keen on as she’d finally have a place to do her art, a yard and the freedom to update the house as I see fit. We’d also be able to get rid of a storage unit my girlfriend has where she stores some of her things that we have no space for in our apartment  which would help with the cost difference.

We walked around the house, talked to the agent that was there and then left the house and looked at each other and said, “it looks like we’re buying a house.”

Now, it’s obviously not as simple as that but the house really fit the fill in terms of everything we’re looking for so we decided that it was at least worth pursuing. The price point when you account for the taxes is a bit high for me but I know there would be some negotiation before we settle on a final price point.

And now we’re in the middle of getting pre-approved for a mortgage, we’re seeing two houses tonight in that area to compare them to this house and then meeting with an agent on Thursday to see the cute little blue house again to see if we really like it and want to make an offer.

I had expected to wait longer but the price point is decent. Based on what we saw in the past 12 months, I was expecting to have to pay 400k for something we liked. That 400k house in a different town would still come with a 8-9k annual property tax bill so the taxes are a problem everywhere here.

The other benefit here is that the location is great, it’s close to things we like and even closer to work for me than my current apartment(a bit further for my girlfriend). It’s in a good school system and close to a lot of employers which is good for resale value down the line as we don’t plan to have kids.

We do have 20% down between the two of us although it will eat into a lot of our cash savings. I’m not sure if I’ll have to touch any of my portfolio cash but I don’t believe I will so it’s all coming out of cash savings that I’ll have to replenish in the next few months.

I expect the payment to be about $2000-$2100 with the taxes in mind which is a bit higher than my rent but it is lower than renting a comparable home in the area($2200+ easily) which means increased expenses. The other things to consider that will add up are the higher heat/cooling costs due to the increased space and all of the things we’ll have to buy as first time home owners and an emergency home fund for anything that may break.

That means a much lower savings rate for the foreseeable future until I get all that sorted out. We’re by no means fully committed to the purchase at this point and want to see the house and some other houses again before we do anything but we’re certainly closer than I assumed we’d be this year.

It’s funny how life can change so quickly. We only ran into the house because we took a different route to the grocery store than we normally do and it just happened to have an open house that day. We weren’t actively looking for homes, nor did we have a realtor at the moment so we likely would have never seen it otherwise and now we’re in the process of potentially purchasing our first home.

I wasn’t sure I wanted to be a home owner so quickly but when an opportunity jumps at you, sometimes you have to take a shot at it. I know home ownership is a lot more stress than living in an apartment but I’m also somewhat excited to potentially be a first time home owner.

I’m lucky to be doing it with a girl that has a good head on her shoulders and plenty of savings to help with the down payment if we choose to become home owners.

I’ve been calling her my girlfriend while writing this post that’s not really true anymore.

I thought about how lucky I was to to have someone like her in my life – someone that’s so in sync with me in almost all things in life while we were discussing the home later that night.

I made another decision that night too and I proposed.

Now my fiancee and I are are potentially buying a house, definitely buying a ring soon and then eventually planning a wedding party(ceremony will likely be in a court house with close family).

On the subject of the ring, I don’t have one yet as she wants to pick her own and made it clear to me that I wasn’t to buy one myself when the time came. Lucky for me, it seems like she wants an opal so a lot less expensive than a diamond, not that I’d choose to be cheap on her if she wanted something better.

This all means a lot of expenses in the future I hadn’t planned for but a lot of excitement too and all because we took the long way home from the park. It’s insane how something that small can have such an impact on you.

Sometimes life is like that, you can plan all you want and set goals and expectations but one single day can throw that all out of whack. Thankfully, this time it was a good thing.