We looked at two houses and drove around a couple of re-developments yesterday. It turns out, even with the incentives those re-developments might not be a good idea for us. I'm not sure we could afford even the smallest of the houses.
One of the homes we looked at was on our block; it's been for sale now since we moved in, probably even longer, and the price has come down considerably. It's still way out of our budget but it's really cute. One thing I noticed looking around was that there had been a lot of cosmetic work done but not a lot of serious stuff. The furnace and A/C appeared to be older than I am (absolutely no joke); the kitchen had been redone but still has out-of-date appliances; the washer and dryer stay but they looked to be on their last legs.
It's a 1930s bungalow, which I love, but it was also a lot smaller than the web site claimed. Even with an unfinished basement included, there's no way this house was 1900 square feet. I think the basement was the size of my old studio apartment – about 500 square feet – and the first level was around 900. Yipes. I bet they're including hallways, closets, and the screened-in porch out back.
If it weren't so expensive it would be fun to finish the basement into an office with an extra bath, and even finish off the porch to make a second living area. But there's absolutely no way I can rationalize spending $1200+ a month on a mortgage when we pay half that for our share of the rent right now. Plus, property taxes in this neighborhood are outrageous. I can't see paying that much for a house that's literally a third of the size of most in this area.
So the real estate agent we spoke to said she has another one for sale, in a more up-and-coming neighborhood. It's a bit further south than we were looking, but we drove past. I guess she owns it, rented it out, then completely gutted it. And I mean completely. It is perfect.
It has all-new everything: roof, HVAC, kitchen, kitchen and bath floors, refinished hardwoods, all sorts of great paint colors, new front door, huge porch, all updated electric and plumbing, you name it. The kitchen was the room that got us. She put in a black and white checkered floor, but at an angle, which looked awesome, all new cabinets, and brand-new stainless steel appliances. After Charlie and I peeked in the back window and saw the kitchen we both said “Okay, we'll take it.” (That's the photo of it from the agent's web site – above.) She wasn't there with us – she just gave us the address, said it was empty, and sent us on our way. I liked that. And I really, really liked the house.
It's exactly what we would look for in a house – paying a little bit more for something that's been totally re-done so we don't have to do anything on it for a few years.
We went straight home and did some math, found some complicated mortgage calculators online. What surprised me was the “How much can I afford?” programs came up with significantly less than we thought.
I know I complain about money a lot and how we never have any but part of that is due to the fact that we've been paying everything off for the past few years. I'm literally months away from owing nothing but a small Target charge (I need to keep at least one revolving line of credit) and my student loans. Charlie has student loans and the car is in his name. Other than that, we're actually doing pretty well. So the fact that this mortgage estimate thingie told us we couldn't even qualify for a Lexus surprised me. We must have done something wrong. My friend Liz got approved for a mortgage and bought a house making about half what we bring in and with shaky credit.
So I guess the agent's going to put us in touch with a lender who can pre-approve us for a certain amount. How much is the bigger question. And I wonder if we're being premature about all this. December or January is when I plan to have all my debt paid off, so it might be better if we did all of this at that point, saved up something for a down payment, started getting stuff from the VA for a home loan. The agent seemed to be steering us away from VA loans, which I'm assuming is because she works with lenders and they have deals. I don't appreciate someone telling me that it's “really hard” to fill out all of the paperwork, but I blew it off. Hey, lady, I grew up in the military; I know from paperwork.