Ten years ago we bought a house in Romeo, Michigan.
That didn’t end well.
A few years later, in the height of the financial meltdown, we moved to San Diego, had to sell when the market was bad, a bank refused to process our short sale, another bank foreclosed on us, and before we understood what was going on our financial world kind of crumbled around us.
That was 2009.
We’d mostly forgotten about it. We’d simply recovered and moved on with our lives.
It only ever manifested itself in two ways.
- For 3 years, nearly every day, I received at least one phone call from a collection agency trying to collect on a debt I didn’t owe related to the house. A company would call for a few months, then they’d sell it to another creditor, who would call some more, on and on went the harassment. I never received anything in the mail… I didn’t actually owe anyone money. But I privately dealt with 36 months of this.
- In 2012, we received a letter informing us that we were among 148,000 people who had been maltreated by our bank. In 2014, we received a check for $840 in restitution for stealing our house. At least they finally admitted they did it, even if they weren’t admitting fault.
August 1st, 2015
On the first of each month, since March 2009, one of the kids would walk next door to give our landlord the rent check. And each month, since March 2009, they’d come back with candy.
But on August 1st, Megan came back with candy and a message. “Mrs. Z said she needs to talk to you about the house.”
Our hearts sank.
We love our landlords. That’s a weird thing to say, but they are our elderly neighbors, they’ve been very kind to us, and we’d been steady tenants for a long time.
We speculated. Was she going to raise the rent? Was she going to ask us if we wanted to buy it? Was she going to ask us to leave? We were certain that it was the latter but we held out hope that it was either of the first two. It wasn’t.
She needed us to leave. It wasn’t a big rush, but they had a family situation and they needed to move in a family member by the end of the year.
Situationally, for us, this was a problem. Our neighborhood is really close to a major university. And while there are a lot of rental properties, most are leased by August 1st. So what was left to rent was either really nasty or really expensive.
Likewise, while summer is pretty relaxed in my life, fall is insane. We launch products, new initiatives, and host events. The last thing I needed was the distraction of moving.
Rent or Buy?
I don’t know where the thought came from but we started doing the math on moving and calculating the cost of renting versus buying.
As we searched we learned good rental house in our neighborhood that meets our needs goes for $2500-$3000/month. It wasn’t 2009 anymore.
Reluctantly, I reached out to a friend from church who does mortgages. We went back and forth via email for a while… the simple reality was settling in. We had enough money to buy. The cost of buying was really similar to renting. And the tax benefits of buying, especially in our situation where we work from home, made it make sense financially to explore buying if we could find the right house.
The Early Search
Kristen and I both work online. So we scoured all of the real estate sites, we put out feelers to our friends, and we went to a few open houses.
Pretty quickly we decided that we were mostly interested in buying, renting would only come into play as a last option.
Early on we decided we wanted to stay in our neighborhood. We’ve invested so much more than rent in Rolando… we’d come to love the place and the bulk of our time raising kids had morphed into this neighborhood.
That’s when Kristen suggested we talk to a local realtor, Doug Lister. We both knew of Doug because he’s super involved in the community, on the community council, and has a reputation for being who locals work with when they are buying or selling. We sat down with him and hit it off right away. Kristen and I are both a little timid and casual. We were impressed that Doug was casual with us but also not timid about getting us what we needed as a family when it came to a house.
The Looking Part
We spent the next couple of weeks looking at houses. San Diego’s real estate market is strong right now. There’s a lot of activity, things come on the market and get snatched up quickly, and prices are ridiculous.
Between open houses and legit viewings we went through about 25 houses rather quickly. There was lots in our price range but we really wanted to go on the low end of our price range. The last thing we want to do is be “house poor” with kids in high school.
A few weeks into it we’d basically given up. We were going to end up renting again. There just wasn’t anything on the market that we wanted that didn’t need a fortune in work. (We nearly bid on one that had huge yard but was largely untouched since the 1950s.)
Across the Street
While we were looking our neighbors across the street moved out. And one day when I came home from the grocery store I saw someone I thought I recognized in an Aztecs t-shirt over there and gave him “the wave.” He came over and introduced himself as the agent who was about to list the house across the street. He asked me if I knew anyone who might be interested in being our neighbor to which I told him… “I think we might be interested, we’re looking, if the price is right we’d definitely be interested.”
That began a process that culminated in us putting an offer on the house the day it went on the market. A few days later, we reached an agreement, and off we went for the next stage in the process.
Closing the Deal
We weren’t (and aren’t) particularly in love with the house. To us it’s always been a rental. So we went through all of the phases of buying carefully. We were probably annoying to everyone in the process because we wanted to make sure we knew what we were getting ourselves into, what the potential for this was for us financially, all of that.
We were (and still are) nervous buyers.
Blah. Blah. Blah. Tell us about the house
Even though I’m a blogger I’m actually pretty private about my private life. So I’ll hold back on sharing pictures.
We’ve bought what we consider a blank slate. We see this as the beginning of a process.
We’ll be spending the next several years transforming this house from a rental house into a home. (With an eye of it eventually becoming a rental again later. But that’s another story for another day.)
Here’s what you get for a whole lotta money in Southern California. A small 3 bedroom, 1.5 bath 1950s ranch with a small yard. The midwesterner in me is offended. But this is reality in SoCal.
Like I said, this is a blank slate. We’ve got some plans for the house… some of which start right away. First, we’re repurposing the garage as our temporary office and Cartel storage space. Then, we’ll be updating the kitchen. (Not a big remodel, but a solid update) And then we’ll probably be building a “tiny office” for my office in the backyard. Or a deck. We haven’t fully decided.