Holy $%!? We Bought a House

Today is another chapter in the Dividend Diplomats mortgage series.   Time flies and surprises pop up where you least expect them.  I’ve written a lot about my house hunt recently, starting with reasons why my wife and I were not in a hurry to purchase a house all the way to the process of finding the institution that will provide us with the best mortgage.   We were always told that lightning strikes and when you find the right house, you need to move quickly.  Well, that was the case here and I could not believe how quickly things moved.  In all honesty, I’m a little shocked about it all here and I’m still finding myself trying to process what went down.  Mostly happy, with some doubts (as always), but her is the story about how my wife and I found our house.   I’m going to have a two-part series about this process – one about the purchase and one about some of my emotions/feelings after the offer was accepted.  So here is Part 1 of my mini-series!

pay down the mortgage or invest

The aggravating process of finding the house

We’ve visited 20+ houses over the last two months and could not find one that we liked.  It sucked.  Our intention with buying a house was that we were going to purchase a house in one of our top desired locations and a house that will suit our future family.  We didn’t want to buy a starter home and find ourselves in a situation where we had outgrown our place in 5-10 years and had to start this process all over again.  Rather, we wanted to buy one house and one house only.

That was the problem we were running into, in our price range.   Our pre-approval was for $300k and that was the maximum amount I was looking to spend.   In those 20+ houses we visited and the hundreds of other houses we viewed on Zillow or Realtor.com, we were saw two categories: 1. houses that we would grow out of that were updated or 2. houses that we very large/nice but needed a ton of work that would require a lot of money.   So the places were either updated and too small or were large enough but were priced so low because they needed too much work.  It was a very, very frustrating problem and my wife and I began feeling like this process would take years to find the place we love.

Through all of this searching though, we told ourselves that we needed to be stubborn on the location.  The locations we wanted were expensive, and we knew that going into this process.  We wanted somewhere that is walk-able to a lot of activities and has great public schools.  If we were going to pay taxes, and our county has one of the highest tax rates in Ohio, we wanted to make sure we were going to put ourselves in a position to benefit from all of the public serves.  We wanted to be close by to our publicly funded parks and wanted to make sure our kids would learn from a top rated, publicly funded school system.  Again, if we had to pay taxes, at least make sure you are getting great services, right?

Because we were stubborn on location, there were really only two areas we were going to consider, and both of those areas came with a premium price range because every other person buying a house wanted those exact same features.  Who wouldn’t?  We just couldn’t win.  Even when we did find a home that we could potentially grow into and was pretty well updated,  we missed out on the opportunity because there were multiple offers on the first listing price and houses were selling for $20k over listing price.  This market, for these neighborhoods, was insane, and we seemed determined to avoid getting into a bidding war backed by passion and emotion.  A recipe for disaster.  Our real estate agent showed us listings that were selling for $160-$180 per square foot, and there were even a few outliers that were in the $200 square foot range.

our first home

One night, my wife and I saw a for sale by owner listing that looked like it was a winner.  We quickly called our real estate agent to set up a viewing of the property.  The property was listed at $269,900, was a deceptive 1,723 square feet, and was in our top location.  The family owned the home for 27+ years, raised 6 kids in the house, and were forced to move because of some unfortunate circumstances.  The family had all intentions of living in the house; however, the father became ill and the family had to quickly move to a one story house to accommodate his illness.   The wife was a former real estate agent, so she quickly put the house up for listing online and tried her hand at selling the house as a for sale by owner transaction.  After our viewing, she was getting ready to throw the towel in and hire a listing agent to speed the process up.  Once that would have happened, we knew that the property was going to become subject to a bidding war and we could potentially find ourselves in a situation where we were bidding against multiple parties and watching the price shoot up.  For comparisons sake, there was a smaller, more updated house nearby that sold for $299k – we did not and were not going to find ourselves in that situation and trust me, we would not have engaged in a bidding war.  We would have just walked and moved on to the next house.

The point is, we had a small window to determine if this was the right house for us.  For a two-three day window, we had a shot where it was just us.   We walked through the house the first day and fell in love with it.   The house had three huge bedrooms and the master had a walk in closet.  Further, there was an attic that was finished and could be converted to a fourth bedroom if and when our family needs the additional space.  There were a few options of where we could build a second full bathroom as well along the main piping, so the addition would not be that costly when the time is needed and we will have a few options on how to functionally add a second full bathroom.  We were excited about this, especially considering that our main goal was to have one house for our family. This house may not be fit now for that, but it has the infrastructure to do so one day.  It passed a HUGE hurdle that my wife and I were having a hard time clearing.

Second, I mentioned that the family had to expectantly leave the house, right?  Well, that was important for a few reasons.  Since the family planned on owning the house, they took great care of it and were updating their appliances and property throughout this winter.  The house has brand new stainless steel appliances (cost of $5,000+), their furnace and hot water tank were less than two years old,  and the roof was less than 10 years old.  Plus, the family took great care of the house over the years and you could tell.  That was also very important to us.   On first glance, the house was covered in wallpaper and carpet, all of which we want to replace soon.  Luckily for us, the house has hardwood under the carpet and all we will need to do is re-finish the hardwood versus having new floors installed.  The kitchen isn’t an HGTV updated kitchen; however, we are very happy with the size and lay out with the kitchen.  So painting the cabinets and walls will go a long way in freshening up the kitchen.

Lastly, the next day we brought our families in to view the house before placing an offer.  My mom’s boyfriend is very knowledgeable about houses and used to inspect homes for an insurance company before he retired.  So I trust his opinion and wanted to make sure the house had his sign-off before we placed an offer.  I told him to go to town reviewing the guts of the house and to voice any possible concern he may have.   If he told me that there were major, costly problems, there was no way that I would commit to buying the house.  The house was older, so I was slightly concerned.  But he left the house with great reviews.  No concerns with the foundation, no apparent water damage in the basement, the basement wasn’t musty, no significant electrical problems, and so on.  He said some outlets are not GFCI and others will need to be grounded, plus there were a few areas that will need some repairs down the road.  But there were not any significant costs looming and in his opinion, the updating in the house was purely cosmetic.   After his “inspection” I breathed a sigh of relief and we felt comfortable putting and offer in on the home.   I can’t thank him enough for his input and advice on this process.

The Offer

Remember, we had to act quickly before the house would have hit the open market.  This was our window to strike.  After our inspections, we met with the real estate agent to discuss the right price to offer that would secure a deal.  The current asking price was $155 per square foot, which was already on the lower end of the range I mentioned earlier.  But that seemed appropriate given some of the cosmetic updating that would have needed to be completed.  We decided to make an initial offer of $260,000, or $151 per square foot.  This was $9,900 below the listing price.   Our realtor also learned that the owners had a full schedule of showing the next day, so she didn’t suggest going any lower because she wanted us to avoid tempting the owners to listen to others and potentially cause a bidding war.  I know this could have gone in the other direction as well, but we were comfortable with the $260,000 price point and submitted the offer.   In our packet, my wife and I included a one page note talking about how excited we were to raise our family in their home and so on.

Much to our surprise, the off was accepted as is.  $260,000.  Just like that, in less than 36 hours, my wife and I went from feeling hopeless about our housing search to having an offer accepted.  It is crazy to me how fast this process went down.   I’m still in shock and my mind is still spinning in 8,000 directions.  Pending the home inspection and finalizing everything with the bank, we are going to be first time homeowners.  We couldn’t be happier, and trust me, we are ecstatic, but there are some pieces of this process that I am still coming to grips with.  And for now, I’ll save that for Part II. Stay Tuned!

What are your thoughts on my purchase?  Would you have offered lower?  What are the features you would not sacrifice on when you purchased a home?


49 thoughts on “Holy $%!? We Bought a House

  1. Congratulations on your new home! I can’t really tell you what I have offered, since I can’t really imagine myself purchasing a home at this point. Since I’m not married, I really do not have any reason to purchase a single family house at this time. When I get involved in real estate, I want to purchase some multi family and get started with some house hacking!

    As for you, what made you decide to purchase a home?

    • Thanks Akash Sky! Love the potential dive into multi family homes one day. Would not mind being a landlord/tenant myself one day. Hopefully I can pick up some handy skills for around the house when making my own repairs/fixings and then apply those skills to rentals.

      We decided to purchase a home because we are getting ready to start our family soon. Something we wanted to do before we had a family was purchase our home that we can grow into. We didn’t want to have to rush a house decision based on a timeline. Plus, we felt like we were ready for that stage of our life after plenty of years renting. Time to start building equity while the interest rates are really low.

      Thanks for asking – much appreciated!


  2. Congrats! The house you need, not the house you can afford. A smart move.

    We also had a list of must have items that we were not willing to let go. Persistence is a great thing.

    • Thanks Amber Tree! Luckily, we were able to get the items on our must haves. We didn’t get everything on our wants list, but that’s okay. We have the location we want, with a two car garage, and a house we can live in forever if we choose. Just out of curiosity, what items were on your must haves listing?


  3. Congrats!!!

    That’s incredible how quickly the perfect house came together. My wife and I are in the same boat as you. We have identified the area/neighborhood that we’d like to live in but the houses get snatched up so quickly and over listing prices that we are waiting. We’re in no rush but shocked at all how hot the market is right now.

    Congrats again!!!

    • Thanks Mustard Seed Money – much appreciated. I am a little stunned by how fast it all came together. We started seriously looking here in April and was expecting this process to drag out until fall/early winter. Never would I have expected that we would have found a place within the first two months. My sister told me it took her two years to find the house of her dreams and she was looking in the same area, so that was the timeline I was working with in my mind. It definitely sounds like we are in the same situation. Patience, as you said, is key to finding the right place without getting in a bidding war. It sounds like you and your wife have a level head that will help you prevail when the right situations arise. We found our listing on the For Sale By Owner listings, so maybe that will help you uncover a gem. Keep us updated on your blog so I can follow along on your search. And trust me, I’m sure I’ll keep you updated on how things go here.

      Thanks for the support!


    • Thanks Rann. What’s funny is that people would tell me that all the time, and I never quite believed them. But it is true, once we walked in, the place just felt different than all of the others. It was the first one that we walked in and could tell that the people that lived in it loved the house and treated like a home for all of the years. I don’t know if that sounds weird, but it definitely stood out and resonated with us.

      Thanks again for the comment and looking forward to seeing you around the blog more often.


    • Thank you very much – I hope you are right about the price haha Are you getting ready to move for a second time? Or is it a rental? And how nice of a feeling was that when you walked into the 41st house and knew that was the one and the search was over??


  4. Congrats! I think a lot of people could learn a ton from your journey. You viewed a bunch of houses, you stuck to your budget and location. And you look at the options in $/sq foot. A lot of people don’t do this, but it is a key factor if you’re looking at places with similar finishing/locations.

    Enjoy the new place,

    • Thanks Buck! I appreciate you saying that, because sometimes it felt like we were firing from the hip during the process. The price per square foot is a huge metric in the process and is a quick/dirty way to understand and gain respect for the asking price/value.

      Take care!


    • Very interesting Troy – Lucky for me, my house is south facing. I didn’t know that and now I am pretty darn excited. Our house does not really have any trees blocking the sunlight, so the yard will get plenty of sun to soak in. Thanks for passing that tidbit along!


    • Thanks BHL! It is a great, but very stressful problem. Trust me, I am EXTREMELY excited that this process is winding down and now the fun part of making the hosue our own will begin. Looking forward to reading your articles about the process and what you will learn along the journey!


  5. Congrats on the home purchase. It’s time for you to buy Home Depot and Lowes stock. You’ll be spending a lot of time there ;-).

    • Thanks IH! Luckily for me, I speculate that one of my credit cards should have a 5% cash back category for Home Improvement stores. That would be some clutch timing for me and be huge. I’m also sure I will be an expert on efficiently navigating those stores soon haha


    • Thanks Mr SLM! I’m happy to hear that I am not the only one that had a quick experience. Just out of curiosity, have you moved a few different times since you bought your first home?


    • Thanks DFS! I’m cautiously looking forward to this investment in the sense that it will stretch my knowledge and skills. But I’m excited to learn! Feel free to pass along any homeowners advice along the way 🙂


  6. Congratulations on the house purchase you guys!!! May you make many happy memories there! As for me, I think I was born to be a renter, at least as long as I stay in NYC. If I move back to Cleveland I may change my mind, but I’ve never needed too much space, and the idea of being on the hook for repairs makes me shudder. For now I think my only real estate purchases will be REITs…

    • Thanks Meow! Nothing wrong with renting for life if that fits what is best for you and your current situation. Buying was right for us, but we had been renters up until this point. On a random note, What part of Cleveland did you grow up in?? How long ago did you move? It is always nice to here from a fellow Clevelander.


      • Bert, I grew up in Chesterland, went to college the first time at Cleveland Institute of Art in University Circle, moved to South Euclid, and then went back to school at CSU to take some accounting classes. I left to find work in 2012, and all my family is still there. You’re the first other dividend bloggers from the ‘land that I’ve met though, which is exciting!

        • Awesome, awesome, a fellow east-sider. My wife was born and raised in South Euclid and I grew up in Lyndhurst, so we are pretty familiar with your old stomping grounds. It is always nice talking to a fellow Clevelander!


  7. Congrats! Sounds like a great house, fitting your needs like that. We probably would have done something similar.
    When we bought our house (3 years ago) the markets we’re already lifting up a bit, but we had the luck the location that we wanted to live in wasn’t as appealing to many others. So, we played it our very slow and our bidding proces took 3 weeks, but with great results.

    • Divnomics,

      That’s clutch that you were in an area that was not a part of the crazy bidding. Makes finding a deal and playing it slow like you did possible. A key to finding the great results. Glad to hear it went well for you. Did you happen to write about this? If so, can you share any links??


  8. Bert,
    Congrats this is a crazy story. In the end it is amazing that it all works out! You are more patient than we were. We begrudgingly went to see one last house after we made an offer on a house that was just OK. After we were blown away by the final house we had to scramble to cancel the first offer and put in a new offer.

    It is an absolute whirlwind but in the end you will love it! Will be interested to hear Part II and the paperwork and bank ‘fun’ part of the equation.

  9. Congrats on making $40K right off the bat!!
    That’s what I’m talking about, making money at the time of buying. You’ll enjoy your own house way better than renting. Putting money in your pocket everytime you make that mortgage payment!


  10. Bert, it is wonderful seeing you go through so many awesome life stages in such quick succession. Congrats on buying a house and getting it done! That is awesome.

    We wish you and your family all the best on moving in – hopefully it’s everything that you could want.

    Mr DDU

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