It was bound to happen. After 2 years of on-and-off and very on and very off and very on again looking for a house to buy, we put an offer in and won. Or, at least I think we did. Our sellers supposedly picked us, and they’re signing their counter offer that we signed in the morning.
This is a huge deal. I’m so tired of the entire process that it just feels like a huge relief to be “done” with it (even though our home ownership journey is just beginning.) In order to not totally get in over our head in Bay Area real estate (which is so easy to do) I made some simple rules about buying…
- NO crazy bidding wars or unethical negotiations
- Keep mortgage to under ~$7000 / month with space for FIL (who also will contribute to mortgage for a few years)
- Buy in a neighborhood I can see us living in for many years
- Buy a big enough lot to be able to expand the house if we want to stay
- Buy in an area that, if not super close to current job, is close to a strong job market with future options
- Buy a house that isn’t a fixer upper (ie nothing clearly falling apart, everything generally livable for 5 years without changes)
I think we got most of the above. I feel like we have been dealing with HUMAN sellers, which is nice. They apparently picked our offer over a higher bid because they really liked the heartfelt letter I wrote. I had heard of people winning house buying bids with letters but I wasn’t sure that was a real thing. Apparently, they liked us, because we’re real people, who want a real house to raise our family in. I guess that struck a chord with them. Or maybe my realtor is lying to us. In any case, I feel like while we’re paying A FUDGE TON for this house — both buyer and seller are winners here.
The risk I’m taking is that I am placing a bet on being able to sustain my current job for 15 more months, which includes 5 months of maternity leave (I can get laid off during maternity leave but it’s less likely than if I were working and at risk due to any performance issues — which isn’t a problem right now anyway as I’m finally kicking ass and taking names at work.) So that’s basically 10 working months to vest all my stock. I’ll sell it on vest, which will help me hit my other goals for next year:
- superfund 2 529 accounts $75k each ($140k total)
- max out pre-tax 401k, husband’s solo 401k, AND my after-tax account (~94k towards retirement)
- max out ESPP plan (~$21k)
By doing this, I also can move towards my continuous goal to fix my portfolio diversification — the retirement funds are getting a lot of bond funds and international funds to move away from being too heavy in large cap US stocks. It will take a few years to balance that out, but I’m getting there. Avoiding selling my large caps because they are like 75% cap gains right now and my cap gains rate at the moment is close to 35% with state and fed.
We’re trying to get to $450k cash in hand for down payment, close, and emergency fund. I think after I sell off my upcoming RSU vest this month we’ll be about there.
It’s crazy to think that this is possible… going from basically $0 in 2005 to where I am now. I really don’t know how I got here (well, I do, I tracked it all on this blog) but it still feels like a dream.
Buying this house is terrifying. We are going in no contingencies, as one must do around here to win a house — and giving the owners a 30 day “rent back” (ie live free for 30 days gift.) This would not be a huge deal except I’m due in mid January, and this puts our move in date around end of November. While my husband has promised to do all the hard parts of moving and I can just sit and point to things (and despite what my friends think we don’t have THAT much stuff since we live in a 1 bedroom) it still gets a bit scary thinking of moving in late Nov/ early Dec. It’s possibly at that point something could go wrong with my pregnancy, and that will make moving very difficult for my husband — having to manage moving, kid, and me potentially in the hospital. I’ll be 32 weeks or so at that point, so hopefully it won’t be an issue. But really it’s cutting it close.
Even though owning a home is NOT an investment and is NOT a financially wise decision in a HCOL area like the Bay Area, I feel really good about this purchase. I feel good that the home isn’t perfect and it’s under $1.7M. Anywhere else in the country this sounds like a lot but here it’s really… well… it’s a lot but it’s not much in terms of what you can buy in a house. I like that I’m compromising and getting a 3 bedroom and my FIL will live in the big room and we’ll be living in the smaller 2 rooms. I like that it has room for improvement and that I will enjoy going for walks in the cute neighborhood everyday and love how the neighbors say hi to each other and how in a big sprawling city it has a similar vibe to where I grew up on the east coast. Sort of. At least enough of one where I look forward to meeting my neighbors and maybe even, gasp, making some new friends.
I could have moved to the east bay and spent even less, but that didn’t make sense for many reasons. This price point makes sense to us. I opted out of the peninsula because bidding wars were insane and — when I saw a total fixer mess that we looked at a year ago (that sold for $1.5M) listed at $2.2M with a half-decent flip job, I knew it was time to give up on that city dream. At least for now. Probably forever (I’m really into this 2.65% 30 year fixed loan so it will be hard to find a reason to leave unless rates are this low again and I am super wealthy in a few years.) This is a good, solid house. It has its quirks. The chimney may be slowly detaching from it (ok, that is something I’m worried about and need to get looked at.) But overall, it’s solid. I will feel happy coming home to it everyday. I will feel happy looking out the window at the cute house across the street that reminds me a little bit of the house I grew up in.
I’m glad we didn’t settle on the things that matter the most.
I am so fucking terrified but also excited. I’m turning 37 and buying a house and having my second kid (of maybe 3 kids?) and I’ve kept this job for 3 years as of next month and overall–for me especially–things are going pretty darned well. Sure, the world is falling apart, we have a sociopath for a president and may end up in a civil war come election season, and COVID is still lurking in every corner of air where someone might cough or laugh or breathe, but I feel strangely hopeful. Like, maybe it’s going to be alright for a little while. Like I am not just working and surviving for mere survival.
Seeing my son light up about the “green grass” in the home’s yard — “need to run! need to run in the grass!” he exclaimed — I knew this was the one. I want him to not be stuck inside a tiny one bedroom apartment all day. I want him to be able to run around the yard safely fenced in. To have a little swing set in the backyard and to one day, post COVID, have friends over. To have a house of our own. Life is so fucking short. I’m ready to start living it. For $7k a month. Or, you know, whatever it costs.