The Weight of Money

I mentioned finding a house we’re interested in the other day. Well, we decided to go forward on this house but there have been some bumps in the road. So, I’ll start from the beginning:

The house has been on the market for more almost 3 months, originally listing at 195K. I saw the house when it went on the market, got very interested, did crime survey of the neighborhood and dropped it from consideration. It lingered around long enough to be reconsidered (and I reconsidered my research results accuracy too).

As we were ready to see it, it dropped from 195K to 185K, a good sign since it was already a bit beyond out budget at 195K. We saw it, talked about it, and I did a ton of research. My research on the property, the issues with it, the local area, and the comparable properties state that the house is worth about 150K-165K and the seller is obviously hoping to cash in on the sellers market the fell out from under him. An aside, I must say that when researching an area there is an endless amount of information out there and I feel like I know more about this town and neighborhood than I knew about my hometown growing up.

So, we prepared to make a written offer for 158K but our agent didn’t think it’d fly and instead called the sellers agent for a verbal offer (argh — that wasn’t what I wanted). We get back an offer of 179K. Now, this is still about 15K beyond what I feel the property is worth. But, what I want to do now is put in the formal written offer, probably for something along the lines of 165K, and hope that he’ll have grown tired of waiting for a better buyer to come along and will take the hint that it isn’t worth what he is asking and also see that he has ready and willing buyers on hand.

Of course, I doubt this will get me where I want to be. I really want the property and am trying to not let that rule my emotions too much. It actually has a lot of investment potential — yes, I am actually rationalizing that this is an investment property that we’ll just take advantage of living in until we can actually buy a “real” house. I’ve got good reason to see it this way based on the community/neighborhood changes that are taking place and the commercial/retail potential that it will have when we move out (and after we’ve updated it).

We meet with our agent on Sunday to send in the formal written offer — it has taken a week to make this appointment (due to conflicting schedules) and feels long over due — but at least it’ll be another week on the market if no one else has come along - I hope no one does. Oh yeah, it is not owner occupied and I’ve yet to get the reason he is selling it. However, I reason to believe that this is simply an attempt to unload to make a profit and that is yet another strike against us.

I really want to send a cover letter with the offer that details why it is not worth the 195K, 185K, 179K he has priced it at — most importantly the comparable properties that sold for less and the fact that because it has a gravity heating system it is not going to be priced as high as houses with improved heating systems or even baseboard heat (which would be an improvement in this case). Can you send in cover letters like that? Sigh, I want the house but I don’t want to overpay, nor can we overpay since our limit is still under his last price.

I guess our prospects are pretty slim for getting the deal, but I have to try because we’ve got no other options at the moment. Homes in our range just don’t tend to show up on the market expect once every month or so. But damn it, I want the seller to realize he is way too late for the price he wants and needs to realize that it just ain’t worth more than 165K (if it is even worth that much!), because I want the house — I’ve already mentally moved in, sigh, foolish me.

We’ve found a house that we might be able to afford and might be able to live with — is that how it is supposed to go? I mean, don’t get me wrong, I’m all for finding a place to live but I’d think my response would be something more along the lines of “We’ve found our dream home!” However, we’re looking at a purchase power far below the average selling power of houses where we want to live. Heck, we’re looking pretty shabby compared to places that we don’t want to live and that is very disappointing too.

Now, I’ll admit that while walking through this 4 bedroom rowhouse (yes, I am actually looking at a rowhouse and hell has frozen over, I’m sure) I was quite excited about it. I love old houses and every house on the market that I’ve gotten excited about was built in 1900 and this one was no exception. I see with blind eyes when it comes to an old house because I love the high ceilings, the creaking floors, the tired plastered walls, the tiny rooms, the old fashioned everything. Luckily, the partner walks about looking for everything that is wrong about a situation and hyper focuses on that — he tells me he uses that as a method to seriously examine if he can deal with the crappy stuff enough to see the good stuff.

Anyways it is a 3 story house with the 3rd floor/attic as a 4th bedroom that is only suitable for someone 4ft tall — which I happen to have one around. The heat is the old fashioned heat pushed up from the basement through the floor grate on the first floor and then rising waves a colder air through the floor grates in the 2nd floor — the 3rd floor/attic looks like it’ll just need to rely on the fact that it is at the top of the house. There is no central air and I was told that the window units have to work pretty hard to cool things enough. The wiring needs some help but at least I’ve got an electrical engineer that, although he hates electrician work, will be able to help get that in order. There is a 2 car garage in the back — like way out back, it seem unusually far from the house. There is a two-story storage shed — really it looks like a tiny little old-woman-in-the-shoe styled house. It is really cute and I imagine a 15-year-old daughter dreaming of moving out of the house and moving into that.

It is downtown a local town that is undergoing renovation and improvements. The local school is better than the one we’re in now and it is on the other-side of the magic dividing line between a decent school and poorly performing school. Things are within walking distance and the neighborhood seems like it isn’t the worst of the worst — is that an acceptable criteria? Luckily the place is currently being rented by a man willing to share all sorts of details about the place. Like problems it has had and the landlord has done the minimum to cover over, that the heating bill for a 60-degree temp in the winter is around $300, that it gets really warm in the summer, that the neighborhood has its problems like his son’s car being broken into once and the general condition of a boarding house a couple doors down.

This house needs some serious consideration and we have to think about crossing that border of a house that is safe and secure, without a doubt, without a risk, or moving into an improving area and also an area that it busy during the day from commercial traffic and accepting the problems that may come with the downtown night life, that is probably nothing compared with Baltimore. So far, I’m pretty sold on the house for the right price and tonight’s conversation with the partner will show what action we want to take.