Author Topic: New house possibility  (Read 3022 times)

Maigahane

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New house possibility
« on: May 15, 2014, 11:22:55 AM »
DH and I have been talking about selling our house and moving. Our house is way bigger than we need (2400 sqft, 4 bed, 1.75 bath for 2 people with no plans for kids) and it's 35 miles away from our jobs which are ~6 miles apart. An option has fallen into our laps that we're considering. It's 2 miles from my job and less than 10 from DH's.

Current House:
Needs something done with the floors. There's carpet over hardwood in the living room and 2 upstairs bedrooms and fake hardwood over real hardwood in the kitchen/dining area. The carpet in 1 bedroom and the living room NEEDS to go. We've seen the hardwood underneath the 2 bedrooms and it's not in great shape but I think it can be refinished for a "distressed" look that will actually look pretty good. We're not positive about how it looks under the living room or kitchen. Fake hardwood is not held down in away way as far as we can tell. I was able to get my fingers underneath when we pulled carpet out of one room and pull up and you could see it lift up three feet out. Still DH is wary about pulling up the fake hardwood in case the real stuff is too damaged. But the fake stuff clashes horribly with the real stuff so I'd either want to re-carpet the bedroom and living room or go back to all the original hardwood. Would you take the chance and pull it all up and try to refinish or just put new carpet in the two rooms?

New House:
Pros
  • Very close to our jobs
  • Big backyard for our 2 big dogs
  • We know the owner and they're cutting us a deal on the house
  • Not only that but they've offered to help with repairs at cost of materials because the husband likes doing that stuff. Bonus is that we get to learn since we know very little about home repairs
  • Newer roof
  • If we buy this and sell our current house we can max out all of our retirement accounts and be able to retire in 7 years

Cons:
  • It's not in quite the area I was hoping to be though DH seems excited about it
  • Just as big as our current house and older (1950's vs 1920's).
  • TINY one car garage. Ideally we'd like an oversized 2 car. There's room to build a bigger one if we decide to but I have no idea what that would cost
  • We haven't looked at it yet but the owner says it could really use a new kitchen and bathroom (keep in mind they've offered to help with repairs and since they have rentals they have contacts with contractors). Also sounds like a similar problem with the floors as our current house. We're going to look next week...
  • We can't sell our current house until we're out of it because of the dogs so we'd have 2 mortgages at once. The town our house is in has a very slow market, our house was for sale for a year before we bought it in 2008 and a neighbors house took 2.5 years to sell even though they lowered the price by 25%, another neighbors house took 6 months. We can afford the two mortgages but we may have to cut back on retirement savings to pay for repairs and definitely won't be getting ahead on student loans

New house would most likely not be our retirement house since we want to live way out in the country, possibly back home near our parents. So we'd be planning on selling it again in 7 years or so.

Numbers: Current house appraised at $136k in 2012, local market has stayed pretty steady since then. Current mortgage $120k, $1375/month on 15 year loan. New house $90k, payment somewhere around $6-700/month on a 30 year loan (just until we sell the current, then we'd refi). Gross income $90k/year, net income about $1100/week (after taxes, insurance, and retirement savings, can raise this by about $450/month by suspending retirement savings if needed). Other debt, ~$750/month between my car and our student loans, all very low interest rate

What do you think about this possibility?

waltworks

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Re: New house possibility
« Reply #1 on: May 16, 2014, 07:09:50 AM »
I'm a little confused - the move sounds like a no-brainer. Why can't you sell the house because of the dogs? There are a ton of options there (board them on days when there's a showing, have a neighbor watch them, take them to work if your work allows, etc).

The carpet vs hardwood thing is not a huge deal here - you're not selling a mansion. If similarly priced houses in your area are nicer, you might need to do something but then again you might not. Irrelevant to the main decision, IMO, since it's a few thousand bucks at most to deal with it.

Why do you need a 2 car garage? Do you have 2 cars? Because at the 2-miles-from-work house, you won't need 2 cars, right?

I think this is a slam dunk based on what you've posted. Just the gas/travel time savings will more than make up for even selling the old house at a loss.

-W

Maigahane

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Re: New house possibility
« Reply #2 on: May 16, 2014, 07:36:35 AM »
One dog is ancient and starting to have accidents. I can't pull up the current carpet while he's there because he can't walk on hardwood (great dane, no traction...) and I don't want to put down new carpet if he's going to have accidents on it. Plus with that much animal in the house there's no way to get the animal smell out of the house while they're living in it (we actually had a realtor mention the animal smell a few years ago when we thought about selling). And because of the accidents I wouldn't ask someone else to take him in during showings. 

We do have two cars and that's not going to change. Feel free to facepunch but it still won't change. We both have cars we love and they're both fairly mustachian (Mazda3 hatchback, and Jetta diesel wagon). Costs to keep them are low; insurance is $56/month for both, registration is cheap, and they're both in great shape so there's minimal maintenance, one has been paid off for years and the other I got for a great deal with great financing so interest is about $17/month and dropping. We'd be willing to have just one car if one died but we're not going to sell one. I would not be driving to work if we got this house though, I'd join the ranks of the bike commuters.

As I think on it more I am leaning towards new carpet because it's probably about the same price as having the hardwood refinished without the unknown of the hardwoods condition.

We are set to see the new house Tuesday so that will help with the decision process when we really see what we'd be getting into

waltworks

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Re: New house possibility
« Reply #3 on: May 16, 2014, 08:29:52 AM »
Yeah, financed car is kind of an auto-facepunch around here. No car is mustachian if you don't actually need it!

It sounds to me like all of your problems here are very easy to solve - pull up the ugly fake wood stuff and see what the floor looks like. Put some tractiony doggie booties on the great dane. If it's ok, refinish. If not, carpet. Boom. Done. Buy or build a cheap doghouse and dogs live outside for a few weeks while you fumigate/clean house. Boom, done. In love with an unpaid-for inanimate 1500# chunk of steel and plastic when you have 2 of them? HTFU and sell it; enjoy paying off student loans faster and more freedom. Boom, done.

The move makes sense anyway, it sounds like to me, and there are a ton of easy solutions to the problems involved with doing it.

-W



Maigahane

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Re: New house possibility
« Reply #4 on: May 16, 2014, 09:28:39 AM »
Have you ever tried putting booties on a 13 year old dog that has never worn them? It doesn't work :) Neither does putting dogs that have been inside their entire lives outside for extended periods of time. If he's outside for more than an hour he starts barking and he's loud enough to get all the neighbors upset and the cops called on me (has not happened but definitely could).

There are very few things I consider non-negotiable, but the cars and the dogs are. I am willing to negotiate on the garage, I just didn't think DH would be but he seems fine with the tiny garage that looks like it'll barely fit his Mazda

Fake hardwood actually looks fine, just not next to the real stuff...they clash. I think I'm still just stuck in the thought process we had when we were planning on staying in the house of doing what we want done to it, not what we can do to make it sell quicker on the cheap. If we were going to stay in the house we'd probably throw about $40k into it and have all hardwood upstairs and fully finish out the basement along with electrical upgrades and other miscellany, but that's just not worth it when you're going to immediately sell it. So I'm thinking new carpet in the two rooms and a fresh coat of paint everywhere will get it ready to sell.

And really owning two houses for a little while isn't my dilemma, we can afford it. It's the combination of I'm not sure how much I want the new house and I really dread the hassle of selling the old one. Numbers-wise it does make perfect sense. But the current house is in a tiny town who's only real advantage is that it's 30 minutes from 2 cities so it's great for people like we used to be where one person works in each city. So the market is sooooo sloooowwwww (*insert whiny voice here). Since new house is just the plan for 7 years until we can retire and build our dream house I just need to tell myself to deal with it as long as there are no major issues when we look at it Tuesday

SunshineGirl

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Re: New house possibility
« Reply #5 on: May 16, 2014, 11:30:00 AM »
It doesn't sound like the right house to me. It's still bigger than you want and not in your ideal location.

I would pass.

Maigahane

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Re: New house possibility
« Reply #6 on: May 16, 2014, 11:55:12 AM »
It doesn't sound like the right house to me. It's still bigger than you want and not in your ideal location.

I would pass.
The thing is that DH likes where the house is and wants way more room than I do so this house is more what he's looking for.

I've found four other houses I'm going to try to get him to look at. All of them are smaller and at least a little cheaper (three are $80-86k). Two are in the area I want and move in ready, one is in that area but would need a 203k loan to cover needed improvements ($40k house so maybe $70k loan) and one is close to the first house we're considering.

The area I want I can't bike to work from but DH could if he were so inclined...not sure he is yet though. Also the area I want is about to have major roadwork done on the big arterial street that will take a few years which can be a big inconvenience for us.

This is helping me sort out thoughts and priorities so keep up the comments :)

Maigahane

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Re: New house possibility
« Reply #7 on: May 23, 2014, 09:24:24 AM »
So the house we looked at Tuesday is a no. It needs more work than we're really willing to put into it and neither of us liked the floor plan much. 

However, we looked at another house yesterday that I think I want and while DH isn't as excited he said he won't say no. It's a foreclosure, listed at $85k but the realtor said HUD is accepting a minimum bid of $79.5k. It's much newer (1999) and smaller (1600sqft). It has a deep one car attached garage and a large backyard that is mostly fenced.

The bad: it needs new flooring everywhere. As in the entire upstairs does not have carpet, basement carpet is stained, the kitchen has peel-and-stick tile over the linoleum and neither looks very good. The sliding glass door needs replaced, the front concrete step needs work, and the back porch needs some too. It only has one bathroom which is not horrible since it's just the two of us but we both prefer at least an extra half bath.

The good: it's in the area I like about a mile from DH's work and 6 from mine. Structurally it looks good, foundation and roof look to be in good shape. Kitchen is in good shape too, just one drawer looks like it needs replaced. The basement has a large room that would be perfect for our social gatherings.

Money: I also talked with Wells Fargo yesterday about financing options. We can easily get a loan as long as we can come up with the down payment money. This is a sticky point because we've been throwing all extra money at debt so we have very little cash. According to them we'd need about $8k to close and right now we have about half that. I'm starting to throw money into savings instead of at debt but may not be able get enough saved up in time for this particular house. I'm going to call around and see if I can get cheaper closing costs

There's also the issue that we'd need to put in flooring once we buy it. We can probably put it off for a little while but that's one of DH's concerns with the house.

Any one have experience buying foreclosures? Is there anything I should know about the process?

SunshineGirl

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Re: New house possibility
« Reply #8 on: May 25, 2014, 06:36:46 PM »
I suggest keep looking. There will be one that both you and your husband walk into and say YES, THIS IS THE ONE. Just keep looking until you find it.

Maigahane

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Re: New house possibility
« Reply #9 on: May 27, 2014, 01:45:41 PM »
This house would be intended as a "long-term temporary house" where I'm planning on living  for 7-10 years while we max out retirement accounts, then we'll move and buy/build our dream house. For our ER we don't plan on staying in this state so I'm not so worried about loving the house. We've lived for 6 years in our current house with pretty similar feelings overall that he has towards the new one and if it weren't for the distance we'd probably stay in it.

The more I think about it the more I like the house. Unfortunately with a very hectic holiday weekend DH and I didn't get a chance to discuss it more yet. I'm going to talk to him about it tonight. I certainly won't push it if he doesn't feel comfortable but the way he talked before it sounded like his big concern is that we'd need to figure out flooring right after we buy it while paying two mortgages. I think we'd be fine just putting down a couple of cheap rugs at first

I also called another bank over lunch today to talk about financing and not only can we easily get approved but we'll have a much easier time with the closing costs through them.