Friday, April 16, 2010

Home purchasing (shit just got real)

I decided to take this week (mostly) off from work and take a well-deserved vacation. This entire semester, and especially the last couple of weeks, I've been working crazy long hours to finish my dissertation (like get to work before 10am, don't leave till almost 9pm kinda hours).

What have I done this week? Well, I caught up on a lot of on-demand TV, I visited the dog park a few times with Barkley, I dropped B off and picked him up from his new job, and I also emailed a bunch of people a bunch of things. One of those emails was to my new chair, asking her for recommendations for a 'buyers agent' for which to buy a house.

Yes, we are buying a house! Hopefully, if we can find something in time to move down there in July (If not we are going to rent). I emailed the buyers agent yesterday and plan to go on a trip down to our new area in a few weeks, check out a ton of houses, and pick a few that we like. B will probably not be coming with me due to said new job, but I'm going to take pictures of the places I really like and email them to him. Then we will hopefully put in a bid on our top choice, and do other stuff from afar.

Meanwhile, this guy emailed me back with some info on a mortgage company ahhh!!! Shit TOTALLY just got real. We also have to come up with a list of what we want in our dream house. So, readers, what things would you look for in a dream house? This is the list we have so far:

1. Large fenced in backyard for Barkley
2. Attached garage preferable, if not detached garage or carport (they have a lot of carports in the south apparently)
3. 3-4 bedrooms
4. 2+ bathrooms
5. Decently sized kitchen with lots of cabinet and counter space
6. hardwood floors preferred over carpets
7. NOT a 'fixer upper'
8. In a good public school district
9. Close to my new job but not *too* close so that I am running into my students every time I open the door (and not in a student neighborhood either).
10. Preferably a giant wrap around porch (or front/back porch of some kind)
11. preferably near a park or somewhere where it would be nice to walk with Barkley.
12. Central air conditioning

So readers, what other things should we be thinking about?


  1. How about "in my price range? :)

  2. I think the most important things in a house are things you do not see:

    1) how stable is the construction, etc... (if there are problems with this, it might cost you an awful lot of money)

    2) Isolation against heat and cold - you do not want to freeze in winter (how can you find this out?)

    3) technical applications like heating system, fuel tank, water system, ventilation, air conditionning etc.

    4) are there pollutants in the ground, and around your ground?


    Conclusion: it is not a very good idea to go there once and if the house "looks pretty", you buy it... There are many pitfalls: have a competent person councel you (and of course not the real estate promoter, he has an interest)

  3. Shoshi- aren't those types of things covered by the home inspection? I think it is standard to have one or even two people inspect the home before purchase so that you know what those issues there are. And we are not buying it based on appearance alone. :)

    The real estate agent has an interest in selling me a house, true, but we are working with a buyers agent who does not have an interest in selling me a specific house. But yes, I do know to keep in mind that the agent's interests are not necessarily my own. This guy came highly recommended though, and two of my future colleagues have bought houses with him and were very happy, so hopefully he won't be too shady. :)

  4. ysh- we know that too. :) We just haven't figured out the exact price range we want yet, and want to talk more to the mortgage company first to see how much we are approved for, what rate we would get, and how much it would cost each month (vs. how much we know we will be earning)

  5. A GOOD roof. Really. And make sure that you DO get a really thorough home inspection by a qualified individual. A wrap-around porch is great but not if there is wood rot underneath it.
    You're going to need AC and it should be a good central unit.

  6. Ignore what the bank says about how much house you can afford.

    You do not want to be "house poor", and stretching to the limit to buy a house leaves your finances in a very very bad place.

    Also, try to get the seller to pay the initial fee for an American Homeshield Warranty. There are a number of warranty companies, but we've used AHS for a long time, and never had a problem getting them to actually handle an issue. And that is the key with any warranty/insurance.

  7. You know, I rented a house three years ago. I loved it by it's looks, and was just overwhelmed by emotions.

    Soon after moving in, it turned out that it was not at all what I wanted. (very hot in Summer, too low ceilings, the applications etc happened to be OK).

    So one year later, I moved out, nothing happened.

    If you buy, it is not as easy to get rid of it and move on...

    It is very easy to get carried away by emotions when you find a new place...

    I do not know what the US house inspector does, since I live in Europe. But once you really like a place, you might not be very keen on the inspector finding problems...

  8. Besides, there might be things that are not "critical", but relevent for the prices: If they just put in a new fuel tank, it might be different than if you have to replace it after 5 years.

    Keep cool, take B with you, 4 eyes see more than two. Try the toilets, etc...

  9. an eruv, walking distance to shul(s), just kidding.

    Look at the big stuff, roofing, water heater/HVAC, things that will cost $$ if you have to repair them now or within the next few years.

  10. dave- yeah I know all about being house poor, and we definitely won't be getting the maximum we can get.

  11. Usually carpets are laid on top of hardwood in standalone homes in the US. So I wouldn't worry about that. Houses are cheap in most southern US states so I think buying makes sense. Check though how big the property tax bill is.

    I've just been reading on the Chronicle website about how "SLACs" (are there any LAC's that aren't "small"?) expect faculty to be available to students all the time. So if your job is at one of those places then maybe you'd be expected to be near the school? I don't know what type of school you will be at of course.

  12. I'm going to be at an R2, most of the younger profs actually live further away from the school than where we hope to find a place.

  13. Having purchased several homes, my two (or three) cents is: don't buy unless you can put at least 10% down, have three months emergency savings and no credit card debt plus another $3-5,000 for emergencies (i.e. need to replace a roof, a furnace, etc.); and total mortgage, insurance and taxes are not more than 25% of your gross income. If you are planning on children, remember that your expenses will go up (i.e. child care if you keep working full time) or your income goes down (you work part-time) or both, so definitely don't get as big a mortgage as the bank will give you. I would rent in the area for 3-6 months first, but this might be a good time to get a good interest rate so I could see some benefits to buying if you really found the right house at the right price.

    BTW, although you definitely need a home inspection, the inspection doesn't cover everything. Depending where in the south you are, consider paying for a separate termite/carpenter ant inspection. Remember that terminte damage is not covered under a homeowner's policy. If you are in an area that gets hurricanes or any risks of flood, make sure you buy separate flood and hurricane insurance.

  14. Reasons to buy immediately:

    1. Some purchase costs covered in a relocation package that will otherwise expire
    2. Interest rates are going up and will continue to do so

    Reasons not to buy immediately:

    1. Time to get to know the area and figure out exactly where you want to live

  15. How long till you get tenure? How easy is it to get tenure? We bought a house before I got tenure, and I didn't really feel secure until I received tenure.

  16. Dash- I have 6 years to get tenure, and the main thing I need to do is publish at least 6 peer reviewed articles in that time. I already have one under second review that will count, and plan on getting 4-6 articles out of my dissertation, so based on maybe 2 more years of working on stuff from my dissertation, I'll probably have enough for tenure. I don't want to say it's guaranteed, but I'm fairly confident in my ability to publish 6 articles in the next 6 years. :)

    Nora- we have both been saving up money for years, and can afford a 20% downpayment on a house in our price range, plus have enough for some repairs, plus enough for decent savings left over. Based on mortgage calculators from the internet, we would be paying around 20% of my income on a mortgage,although would also spend a bit more on taxes. The only reason we haven't bought a house yet is because we knew we would be leaving the area after graduation. Plus the houses in the area we are moving to are super affordable- about half of what similar houses cost in the northeast. :)

  17. A propos interest rates going up:

    Be ready to pay also high interest rates.

    If you get a mortgage on let's say half of the average/maximum interest rate, put the other half on a saving account for a time where interests might reach that level... Or pay back double, but do not rely on the interest rates staying low.

  18. @Shoshi - US mortgages are normally at a fixed interest rate. So one doesn't have to worry about interest rates going up once you get a mortgage. This is unlike UK, Australia and most other countries. The only thing to worry about is that higher interest rates tend to depress home prices. As prices are already low in the US south it's not something I'd worry about at the moment. I think that buying is a good decision for AE and husband. Only issue is whether they might change their mind about desirable neighborhoods or whether they want to live in that town at all going forward. AE said there are some relocation benefits. These may well compensate for those potential costs (of moving again in the future if they don't like it).


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