I get an email from the MLS database about another house, just a block away that has come on the market. I know this house - walked through it when it first went on the market over a year ago and was staged beautifully and priced at $510K. They reduced the price twice, and still it sat, the staging lamps lit at night, burning sadly in the window. They finally took away the staging and the real estate sign after six months, and it has sat empty ever since. About 900 square feet, and a 5000 square foot lawn. MLS is listing the price as $371K.
I call F. the next day. She finds out that it is bank-owned, and they want offers by 1:00PM Friday. Today is Wednesday. This is insanity! The Husband walks the dogs past it, peers in windows, peeks into the backyard. We meet F. there on Friday morning, she does a walkthrough with us. The fence is falling down, teeming with termites. One wall of the master bedroom has been converted in a mishmosh of a storage unit, cupboards and drawers of assorted sizes. But we see potential. We decide to give it a shot. We give F. a check to include as a good faith deposit.
F. emails the contract, we sign, scan, and email back (how did they do this before technology?). We offer the asking price. The agent for the bank tells F. that there are seven other offers.
The good news of bank-owned properties is that they make a decision very quickly. We get our sorry, no by late afternoon. We are not close with our offer - others have offered much more, and can put down very large deposits. We shake it off, tell ourselves that we're just starting to learn the process.
Monday, August 31, 2009
Pest Reports Are Your Friends
Second weekend, fewer houses - some we rule out just by driving by. After 16 years on the force, the ex-cop Husband casts a fisheye on any of the following being too nearby: apartment complexes, especially with people hanging around outside; liquor stores, especially with people hanging around outside; and young men walking pit bulls, rottweilers, or mastiffs.
We look at another tiny place in Albany - when will we learn? Remodeled, everything new, inside and out - but only one bedroom, and a microscopic lawn. They give us a typed list of everything they've done to the house: new plumbing, drip irrigation, double-paned windows - and three sump pumps. This tiny property requires THREE sump pumps?? As F. says later, "Is it on a river?" Asking price: $469K.
On to another place in Berkeley, where someone clearly lived for years, and kept things clean, but not updated. But it's huge - the eat-in kitchen could hold a table for twelve. It takes us a little time to find the "unpermitted" second bathroom - walk out the back door of the kitchen, down the stairs, across the patio, down another little set of stairs into the laundry room - where the ceiling is so low the Husband cannot stand upright. "You're doing all the laundry," he says drily. The washer and dryer sit on one side of the laundry room; a toilet, sink and cement stall shower on the other side. Gee, not up to code? Asking price: $425K.
The Husband does not like the looks of the apartment building across the street, but I ask F. to pull the reports. She emails pages and pages of inspection and pest reports - termites, electrical issues, plumbing - estimated at $36K, but she will also insist on a stucco test and foundation inspection. I forward the reports to my handyman brother in San Francisco, and he is more concerned with what is missing from the report than by what is included. We don't pursue the house, though I had already remodeled it in my head. Must stop doing that.
We look at another tiny place in Albany - when will we learn? Remodeled, everything new, inside and out - but only one bedroom, and a microscopic lawn. They give us a typed list of everything they've done to the house: new plumbing, drip irrigation, double-paned windows - and three sump pumps. This tiny property requires THREE sump pumps?? As F. says later, "Is it on a river?" Asking price: $469K.
On to another place in Berkeley, where someone clearly lived for years, and kept things clean, but not updated. But it's huge - the eat-in kitchen could hold a table for twelve. It takes us a little time to find the "unpermitted" second bathroom - walk out the back door of the kitchen, down the stairs, across the patio, down another little set of stairs into the laundry room - where the ceiling is so low the Husband cannot stand upright. "You're doing all the laundry," he says drily. The washer and dryer sit on one side of the laundry room; a toilet, sink and cement stall shower on the other side. Gee, not up to code? Asking price: $425K.
The Husband does not like the looks of the apartment building across the street, but I ask F. to pull the reports. She emails pages and pages of inspection and pest reports - termites, electrical issues, plumbing - estimated at $36K, but she will also insist on a stucco test and foundation inspection. I forward the reports to my handyman brother in San Francisco, and he is more concerned with what is missing from the report than by what is included. We don't pursue the house, though I had already remodeled it in my head. Must stop doing that.
Sunday, August 30, 2009
Houses, Schmouses.
Mid-August, and we do our first trip to open houses with our realtor pal, F. We walk through the house a block away that has the funky yard, and she purses her lips at the 70s era kitchen. Even though she is wearing high heels and lovely crisp capri pants, she does not hesitate to climb or crawl anywhere.
We look at another house in our neighborhood, a tiny two-bedroom, with a huge (5000 sq. ft) lot, all flat - we can easily picture expanding. The previous owners have done the place a disservice, painting one bedroom deep purple, the other midnight blue - including the ceilings. The floors need refinishing, the kitchen needs updating; just cosmetic things, we tell ourselves.
But F. whips through the pest report on the counter, sees $30,000 of termite, dry rot and mold issues, and a sump pump under the house. She pokes sheetrock and walks carefully through the yard, finding what appears to be a sinkhole. F. looks up at us staring down at her from the deck. "This is a teardown," she says, without a shade of doubt in her voice. Asking price, $349K.
Our last house of the evening is bank-owned, and there is still an eviction notice from the last tenants taped to the door. The house looks 20s era, and our first glance inside fills us with hope. Beams on the living room ceiling, still wood-finished, and french doors into the dining room. I can't figure out the painting treatment they've done on the dining room wall until I get close and realize that it's mold. The kitchen still has the original-era tile backsplash - but they've tacked an additional room at the back of the house that slopes downward so much it could be a boat slip. There are old, neglected fruit trees out back, and we quickly find the cause of both the slope and the mold - the foundation is crumbling, and the gutters nonexistent on the side of the house, so water has been leaking directly into the walls. The outside of the dining room wall is bloated and obscene. Asking price: $379K.
I pat the house sadly and tell it we can't afford to fix all the things that are wrong with it. F. and I drop the Husband at home, and go to a swanky bar where I down two grown-up cocktails and am completely pie-eyed. This househunting is depressing.
We look at another house in our neighborhood, a tiny two-bedroom, with a huge (5000 sq. ft) lot, all flat - we can easily picture expanding. The previous owners have done the place a disservice, painting one bedroom deep purple, the other midnight blue - including the ceilings. The floors need refinishing, the kitchen needs updating; just cosmetic things, we tell ourselves.
But F. whips through the pest report on the counter, sees $30,000 of termite, dry rot and mold issues, and a sump pump under the house. She pokes sheetrock and walks carefully through the yard, finding what appears to be a sinkhole. F. looks up at us staring down at her from the deck. "This is a teardown," she says, without a shade of doubt in her voice. Asking price, $349K.
Our last house of the evening is bank-owned, and there is still an eviction notice from the last tenants taped to the door. The house looks 20s era, and our first glance inside fills us with hope. Beams on the living room ceiling, still wood-finished, and french doors into the dining room. I can't figure out the painting treatment they've done on the dining room wall until I get close and realize that it's mold. The kitchen still has the original-era tile backsplash - but they've tacked an additional room at the back of the house that slopes downward so much it could be a boat slip. There are old, neglected fruit trees out back, and we quickly find the cause of both the slope and the mold - the foundation is crumbling, and the gutters nonexistent on the side of the house, so water has been leaking directly into the walls. The outside of the dining room wall is bloated and obscene. Asking price: $379K.
I pat the house sadly and tell it we can't afford to fix all the things that are wrong with it. F. and I drop the Husband at home, and go to a swanky bar where I down two grown-up cocktails and am completely pie-eyed. This househunting is depressing.
It's the Money, Stupid.
As instructed, I go online, surrounded by a pile of tax returns, bank statements and retirement account reports, and fill out the application for pre-approval. It takes over two weeks to get a response, and it is a chirpy email from our loan rep, telling us to sign on the website for our results. Our credit scores are good news (but no surprise since I checked all three credit reporting agencies already), we're both over 800. We're golden.
Not golden, it turns out, but bronze. Maybe nickel. they've only approved us for $350K. On review, I realize that where the application asked for the price of the house we wished to buy, I guessed and said $350K, so that's all the approval we got. Sigh.
I send our loan rep an email, explaining the mix-up, ask her if we can go higher (also pointing out several errors in their credit reporting, read those babies carefully!). She replies the same day, and takes our loan up to $420K. That was easy.
Not golden, it turns out, but bronze. Maybe nickel. they've only approved us for $350K. On review, I realize that where the application asked for the price of the house we wished to buy, I guessed and said $350K, so that's all the approval we got. Sigh.
I send our loan rep an email, explaining the mix-up, ask her if we can go higher (also pointing out several errors in their credit reporting, read those babies carefully!). She replies the same day, and takes our loan up to $420K. That was easy.
Saturday, August 29, 2009
We Got Yer Houses Right Here
We got underway on the Great House Hunt the first weekend in August. F. signed us up for MLS (Multiple Listing Service - a real estate database) updates for El Cerrito, Berkeley, Albany and Kensington. Emails starting popping up daily, and I resisted the urge to open them immediately - this househunting thing could not turn into an obsession.
Which of course it did, almost immediately. I scoured through the listings, bought the Sunday paper and scribbled the list of the six open houses we needed to see that day. I'd done the online application for preapproval of a mortgage, and we were waiting for the results, but hoped to find something for $400K or under.
The first stops that weekend were very local. One house was just half a block away from our rental house. Just over 700 square feet, with two bedrooms and one bath, it felt like a mobile home (and not a double-wide), with a postage stamp of green lawn in front and behind. $375K asking price. Note to self: we need more than 700 square feet.
The second house was a whole block in the opposite direction, sitting in the point of a Y intersection. The house itself was in good shape, about 1200 square feet, but the yard was tiny, and chopped into three sections with funky fences. They were asking $499K, but perhaps we could negotiate them down. Another note: we kinda want some yard for our little dogs.
Two more in Albany, both ridiculously small and ridiculously overpriced for two bedrooms and about 800 square feet. $455K and $475K, respectively. One had a small lean-to against the house, just outside the kitchen door. Out of curiosity, I lifted the lid. A washing machine sat inside. A side door on the lean-to opened to the dryer. I tried to imagine standing outside in the rain, doing laundry. We moved on.
One in Berkeley was beautiful, just off San Pablo Park. The owner was an architect, and had done a great job opening the galley kitchen and adding storage - beautiful new kitchen and bath. I'd misread the price, though. $539K. The Husband was inconsolable, as he thought this the perfect house. I should have read the warning signs - he liked a house that looked old on the outside, but was brand spanking-new on the inside. Just the kind of house we can't afford.
Which of course it did, almost immediately. I scoured through the listings, bought the Sunday paper and scribbled the list of the six open houses we needed to see that day. I'd done the online application for preapproval of a mortgage, and we were waiting for the results, but hoped to find something for $400K or under.
The first stops that weekend were very local. One house was just half a block away from our rental house. Just over 700 square feet, with two bedrooms and one bath, it felt like a mobile home (and not a double-wide), with a postage stamp of green lawn in front and behind. $375K asking price. Note to self: we need more than 700 square feet.
The second house was a whole block in the opposite direction, sitting in the point of a Y intersection. The house itself was in good shape, about 1200 square feet, but the yard was tiny, and chopped into three sections with funky fences. They were asking $499K, but perhaps we could negotiate them down. Another note: we kinda want some yard for our little dogs.
Two more in Albany, both ridiculously small and ridiculously overpriced for two bedrooms and about 800 square feet. $455K and $475K, respectively. One had a small lean-to against the house, just outside the kitchen door. Out of curiosity, I lifted the lid. A washing machine sat inside. A side door on the lean-to opened to the dryer. I tried to imagine standing outside in the rain, doing laundry. We moved on.
One in Berkeley was beautiful, just off San Pablo Park. The owner was an architect, and had done a great job opening the galley kitchen and adding storage - beautiful new kitchen and bath. I'd misread the price, though. $539K. The Husband was inconsolable, as he thought this the perfect house. I should have read the warning signs - he liked a house that looked old on the outside, but was brand spanking-new on the inside. Just the kind of house we can't afford.
Grownups Own, Right?
So what made a hard-core renter like me (and a convert like my husband) decide to buy? Financial factors played a role, of course - suddenly seeing listings for houses in our neighborhood for less than $500,000 - and then watching houses sit unsold for months. And then the Bigfoot of California real estate was spotted - signs that actually said, "Price Reduced." Add to that all the press about the housing market reaching bottom, and our tax accountant telling us that now was really the time, and tax incentives to boot!
There was an emotional factor as well. I was tired of the white walls and neutral, serviceable carpet that is the curse of all renters. I wanted colors of our own choosing; deep, bright colors on our walls. The straw that broke the camel's back was our current landlord's decision that the beautiful, two-story maple tree in the back yard was "too tall." (This despite no power lines above, and no branches above the house.) I begged, I pleaded, to no avail. She arrived on a bright Saturday morning this spring with the gardener in tow, and he stood in the tree with a chainsaw, lopping off an entire story off the top of the tree, leaving naked, amputated stubs. I was a powerless witness to a tree's mutilation. Renting sucked.
I called our friend F., who is a realtor in her spare time as a CFO. She is also an uber-athlete who does 68-mile bike rides on the weekends, is unbelievably fashionable and well-accessorized, and beautiful to boot. She would be altogether too intimidating, except that I have seen her in the bottom half of a fluffy chipmunk character costume, shaking it like a Polaroid. The woman does not take herself too seriously.
F. told me that if we were serious, I needed to contact our bank and get pre-approved for a mortgage. With that letter of pre-approval in hand, we'd know our price range, and be able to start making offers on houses. And she told us to get out there and start looking at open houses. If we saw something we liked, she could pull all the information available to realtors (and not to normal joes) on the property, and we could go from there.
Away we go!
There was an emotional factor as well. I was tired of the white walls and neutral, serviceable carpet that is the curse of all renters. I wanted colors of our own choosing; deep, bright colors on our walls. The straw that broke the camel's back was our current landlord's decision that the beautiful, two-story maple tree in the back yard was "too tall." (This despite no power lines above, and no branches above the house.) I begged, I pleaded, to no avail. She arrived on a bright Saturday morning this spring with the gardener in tow, and he stood in the tree with a chainsaw, lopping off an entire story off the top of the tree, leaving naked, amputated stubs. I was a powerless witness to a tree's mutilation. Renting sucked.
I called our friend F., who is a realtor in her spare time as a CFO. She is also an uber-athlete who does 68-mile bike rides on the weekends, is unbelievably fashionable and well-accessorized, and beautiful to boot. She would be altogether too intimidating, except that I have seen her in the bottom half of a fluffy chipmunk character costume, shaking it like a Polaroid. The woman does not take herself too seriously.
F. told me that if we were serious, I needed to contact our bank and get pre-approved for a mortgage. With that letter of pre-approval in hand, we'd know our price range, and be able to start making offers on houses. And she told us to get out there and start looking at open houses. If we saw something we liked, she could pull all the information available to realtors (and not to normal joes) on the property, and we could go from there.
Away we go!
Thursday, August 27, 2009
A Tale of Two Renters
I've been a renter all my life. The first seven years out of college I lived in New York City, where I dreamed only of an apartment without roommates - no one I knew owned. I moved to San Francisco in the 90s, and was perfectly content with a large studio on the downslope of Pacific Heights.
I met my husband (again, a long story not meant for this blog) in 2000, and he sold his house in Kansas City, Missouri (three bedrooms, 1 1/2 baths, double garage, basement, attic - your basic storage fantasy) for $96,000 to move out to San Francisco and be with me. Goodbye studio, hello two bedroom, one bath, one car garage in the Richmond District in 2001. He'd hoped to buy another house with proceeds from the last one, but this was just before the crash of the dotcoms, when real estate was just beginning its dizzying ascent. Renters we would remain.
I got a job in Berkeley in 2003, and the commute across San Francisco was absurd (especially for a non-driver like me). We came to the East Bay and started scouting neighborhoods. We settled in El Cerrito, renting a smallish house with a huge yard full of fruit trees, walking distance from BART. We were happy, our dog was happy - until the owners, who had purchased the house years ago with the idea that they would live there when they retired - decided to retire. Then came the second rental house in El Cerrito, big house with a 70s flair (my brother walked in, looked at the paneling in the living room and said, "Marsha, Marsha, Marsha!") and a smallish yard covered in Astroturf. We rolled up the Astroturf, planted grass and rosebushes, and have been ensconced here for nearly three years.
We'd look at open houses in our neighborhood, but the prices were just beyond the pale - not to mention that after a Sunday open house, a sold sign would appear by Tuesday. It seemed like we would just have to rent forever.
I met my husband (again, a long story not meant for this blog) in 2000, and he sold his house in Kansas City, Missouri (three bedrooms, 1 1/2 baths, double garage, basement, attic - your basic storage fantasy) for $96,000 to move out to San Francisco and be with me. Goodbye studio, hello two bedroom, one bath, one car garage in the Richmond District in 2001. He'd hoped to buy another house with proceeds from the last one, but this was just before the crash of the dotcoms, when real estate was just beginning its dizzying ascent. Renters we would remain.
I got a job in Berkeley in 2003, and the commute across San Francisco was absurd (especially for a non-driver like me). We came to the East Bay and started scouting neighborhoods. We settled in El Cerrito, renting a smallish house with a huge yard full of fruit trees, walking distance from BART. We were happy, our dog was happy - until the owners, who had purchased the house years ago with the idea that they would live there when they retired - decided to retire. Then came the second rental house in El Cerrito, big house with a 70s flair (my brother walked in, looked at the paneling in the living room and said, "Marsha, Marsha, Marsha!") and a smallish yard covered in Astroturf. We rolled up the Astroturf, planted grass and rosebushes, and have been ensconced here for nearly three years.
We'd look at open houses in our neighborhood, but the prices were just beyond the pale - not to mention that after a Sunday open house, a sold sign would appear by Tuesday. It seemed like we would just have to rent forever.
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