My dad is a dream crusher

OK, he's not really. He just took the wind out of our sails this weekend about the Catalpa house. After the counter offer came through, we decided to take the advice of a friend and go see the house again. On Saturday, we spent nearly 45 minutes in the home, turning on lights, flushing the toilets, measuring windows, looking very carefully at the ceiling for water stains, etc.

One thing that we did not notice on our previous visit was that the electrical outlets in half the house were not grounded. They only had 2 holes. I immediately knew this was a bad sign and dreaded telling my dad. He's an electrical and general contractor, and we rely on his knowledge of what can be fixed and how much it might cost. Dad basically said that to fix something like that in this house would be nearly impossible without major time and money spent. Because the house has a flat roof and no attic access, the only way to get to the wiring would be to rip out the drywall, which is a messy and expensive process. Basically, a flat roof makes it difficult to fix anything.

So, the end result is that we are going to walk away from this negotiation and continue looking. I guess we'll have to add another criteria to our search: a shingle roof. This is slightly problematic given that many of the homes we are looking at were built in the 50s when built up (flat tar and gravel) roofs were popular.

We're disappointed. I was so depressed about this that I couldn't bring myself to write yesterday. And it's not even about this house in particular, which should probably tell me that it wasn't the right house for us, but just about this search in general. I swear, we are not that picky. We're cautious, as Pete's sister put it. We don't want to get stuck with a money pit. We want the right house for the right price in the right neighborhood. Too much to ask? Apparently.

-- Yana

Our first counter offer

So, we heard back from the seller today. Their counter was $230,000, and they are not willing to fix a few of the things we asked for, such as windows that don't open. We were really hoping for something a little bit more reasonable, but such is life, I guess.

At this point, I think our next course of action is to go back and look at the house again. We'll be able to look at it more critically this time, now that the initial excitement has faded a little bit. After that, we may counter them again.

-- Yana

Getting closer?

Our realtor just called. He said the seller's agent has to drive out to Deland tomorrow to meet with grandma and grandpa (the sellers). Apparently, he has to do this between noon and 3 because that's when they're at their sharpest :( Poor old people! Anyway, he thinks that if there even is a counter, it will be pretty favorable to us. Yay!

-- Yana

Maybe we’ve finally found it?

Last night we looked at 2 more houses. The first was listed for a good price ($180,000), or so we thought until we saw it. It was a 3/2, but on the smaller side with about 1,200 square feet. The outside of the house was pretty nice, but the inside was a wreck, a flea-infested wreck at that! The only thing that house had going for it were the terrazzo floors. I don’t know how fleas even live on terrazzo!

As we were leaving, our realtor suggested we look at another home on the same street. When we pulled up to it, I realized that I had seen the pictures of it online but decided not to look at it because the price was too high. It had been listed for $250,000, but the price had been lowered that day. We fell in love with this place.

House on Catalpa Ln.
Beds: 3
Baths: 2
Sq ft: 1,990
Year Built: 1950
Listing price: $238,500
Additional info: 2-car carport, beautifully landscaped yard, inside laundry room, terrazzo underneath new carpet, original 50s bathrooms, old windows, old kitchen, new AC, clothesline in the back yard!

Out of the houses we’ve looked at, it certainly ranks in the top 3 for me. Anyway, we decided to put in an offer of $220,000. We’ll see what they say. Keep your fingers crossed for us!

-- Yana

Bringing you up to the present date...

We basically looked on and off until May when we finally found another contender. This one was in a very nice neighborhood called Audubon Park, about 5 minutes from where we live now.

House on Finch St.
Beds: 3
Baths: 2
Sq ft: 1,182
Listing price: $195,000
Last purchase price: $276,000 in 2006
Additional info: terrazzo floors, tiny kitchen, bonus room with no AC, great tree in front, great neighborhood, new double-paned windows

You might notice that the listing price is significantly less than what the current owners paid for it. Sucks for them. A lot. Good for us? We’ll see. This house was a short sale, which basically means that the bank is going to take a loss on it, and the sellers will walk away without a foreclosure on their record. We put in an offer of $180,000, but we were very willing to negotiate.

We didn’t hear anything for a while, and by that I mean over a month. When you’re dealing with a bank, it can take months for them to answer you. Finally, in mid-July, we heard that the bank had actually reworked the seller’s loan. This took the house out of the loss/mitigation department. The seller proceeded to miss the June payment, the July payment, and most probably the August payment. After that, the house will go back to loss/mitigation, at which time they may look at our offer again. Aaaaaarrrrhhhhh! It’s incredibly frustrating to be in limbo for this long!

Since we weren’t going to know anything about this house for a while, we decided it couldn’t hurt to look around a little bit. After checking the listings online, I found 5 houses that looked interesting. Our realtor showed them to us over the course of 2 days. Amazingly, we found one house we really liked.

House on Hargill Dr.
Beds: 3
Baths: 3
Sq ft: 1,859
Year Built: 1958
Listing price: $235,000
Last purchase price: $116,000 in 2007
Additional info: old windows, 2 car carport, pool, ugly tile throughout the house, island in kitchen, inside laundry room, corner lot with cinderblock wall around it

This house was great. However, the owners made some odd choices. The house used to have terrazzo floors, which we actually like, but they covered those floors with cheap and ugly tile. Why? The one good thing they did was to leave the original bathroom fixtures, which were in great condition. The main cost in upgrading this house would have been the windows. They all needed to be replaced, and in a house that size, that could have easily run us $15,000. Taking that into account, we decided to offer $200,000.

The following morning after looking at the house, I saw that the listing had gone inactive online. Our realtor found out that the sellers had accepted an offer from a guy who had terrible credit. His credit score was so low (500) that he couldn’t get a loan from a bank. He was trying to secure a loan from a private lender, but apparently that didn’t go well. He couldn’t even come up with $1,000 to put in escrow.

We put in our offer Friday night. $200,000, 20% down, we pay closing, we didn’t ask the sellers for anything extra… And we asked to hear back by Sunday night. There was no answer. On Monday, our realtor spoke to the listing agent to find out that our offer was rejected. They felt it was too low to even counter. I guess these sellers had already rejected 5 offers. Well, if they can afford to sit on a house forever until someone is willing to pay their asking price, they are welcome to it. Have they ever thought that since everyone is giving them “low” offers that maybe their asking price is too high?

After some discussion, we decided not to go ahead with another offer. We were willing to pay no more than $210,000 for that house, and we felt that we couldn’t give them an offer with our top price because there was nowhere to negotiate from there. The search continues!

-- Yana

It is a buyer's market!

I wanted to give you a little insight into what we do before contacting "our" real estate agent. Yana and I look online at Ziprealty, Trulia, Realtytrac etc. for houses in our range. We narrow the list down by price, location (the usual stuff). Out of possibly 80 listings we may find 15 or so we are interested in.

We look them up by address on the Orange County Tax appraisors site for information such as taxes, purchase price etc. We then drive by the ones we are interested in and if they are vacant, we stop and peek in the windows. Out of that list, we usually send 3 to our agent to schedule a look inside.

To put it more plainly, we do as much research as we can before we even get to the house. We believe that we are performing, in corporate speak, due diligence. And how easy is it for the agent? Show up, unlock the door and nod!

Homes we’ve liked or made offers on

House on Dunsany Ave.
Beds: 3
Baths: 2
Sq ft: 1,375
Year Built: 1957
Listing price: $250,000, eventually lowered to $235,000
Last purchase price: $175,000 in 2005
Additional info: fireplace, terrazzo floors, old kitchen, 50s bathrooms, 2-car carport, outside laundry, small porch

House on Silverstone Ave.
Beds: 3
Baths: 2
Sq ft: 1,859
Year Built: 1958
Listing Price: $250,000
Last purchase price: $265,000 in 2005
Additional info: fireplace, new kitchen, screened-in pool, garage converted into bonus room, inside laundry, shed with electric

The Search Begins

I guess our story begins like that of most couples. Almost eight years ago we met, fell in love, and later moved in together. My cat and I made the move to Pete’s downtown apartment. Pete and I were thrilled to “set up house” together. We bought furniture and household items. We cleaned and painted. The cat hid under the dishwasher.

Our apartment has a lot going for it. It’s in the front half of a duplex, with our landlord occupying the other half. The location cannot be beat. We are technically located in the Gay-sian district, close to bars, restaurants, coffee houses, and almost every other form of entertainment available in Orlando. And the rent is pretty cheap, too!

But there are also some negatives. There’s the dryer that doesn’t dry, the toilet that runs, the water heater that chooses for you when you will have hot water, the oven door that tries to close on you, the incredibly loud dishwasher, the crappy wiring that blows out light bulbs, the ants that come to live in the winter months… Let’s see, is there anything I forgot? Oh, yeah, it’s not ours. Every little thing that we want to do to improve our living conditions has to be run by the landlord. He’s mostly a reasonable guy, but it’s still a pain in the ass.

Right before I moved in, Pete had the opportunity to buy the duplex from the previous owner for a pretty good price. But he wasn’t really thinking about home ownership at the time, and I was still in school with basically no income.

After we got married in 2004, we started saving money for a down payment on a house. According to my dad, it was either that or immediately have a baby. Unfortunately for us, that was also right around the time that the housing market starting booming in Orlando and around the country. Prices shot up dramatically. Unlike most people during that time, we wanted to be responsible; we didn’t want to get into a loan that was over our heads. We have this crazy idea that you shouldn’t buy something you can’t afford. Funny, huh?

So, we diligently saved our money and tried to wait out the housing prices. But they kept rising and rising and rising… Which brings us to August 2007. We were hearing everywhere about the housing slow-down, but apparently no one else in Orlando was. While nationwide prices began dropping, sellers in Orlando were determined not be to part of that trend. No one wanted to budge an inch, and everyone felt entitled to make a $150,000 profit on their house. That’s right, I said PROFIT. There was a lot of speculation and a lot of house flipping going on.

Despite these obstacles, we decided to finally start looking because it felt like we couldn’t stay in our apartment any longer. Within the first month, we found a house we loved. In retrospect, we made the mistake that most first-time buyers make: we believed that there might be something else out there and didn’t make an offer in time. Although losing that house was a big disappointment, we kept looking.

In October, we found another house in the same neighborhood. This time we moved quickly to make an offer. The house was listed for $250,000, and we offered $240,000, which was the top of our budget. The seller didn’t even call us back. According to the listing agent, they had like 5 other offers. And they continued to have 5 other offers for the next 6 months, when they finally suckered someone into paying the full asking price.

Again, we were disappointed. In the next few months, we saw a lot of crappy and overpriced houses. I know that some people might say we’re too picky. We have a very limited radius outside downtown where we would consider living. In a city as small as Orlando, there is no reason to live anywhere but downtown. There’s nothing to do, and no public transportation to use to get anywhere. We want an established neighborhood with older homes and big trees. The idea of living in one of those cookie-cutter developments in revolting to me.

-- Yana

The basics

Let's get this out of the way first. Between my wife and I, I have the low credit score of 780, she comes in at 805! We have a 20% down payment saved. What's not to love?

-- pete