The House Hunt Has Started
About a month ago, I started to really look at buying house in the (much) greater Memphis area. Coming from my last experience of buying a house in Southern California, it’s been a pretty crazy experience. For one, I can actually do it solo – which is crazy. The cost of living differences between California and Tennessee/Mississippi still catch me off guard in day to day life, but nowhere more so than in the housing market. In this area, it’s not weird for young people to be homeowners. Where I came from, my ex and I were definitely an anomaly (and only because of a perfectly timed house hunt that involved a fair payout when the house we were renting got foreclosed on, and because my family gave us a place to stay free of charge after we were displaced).
So I started the process of getting pre-approved for two separate loan types – FHA (for first time buyers – which I qualify as on a technicality, no complaints here), and a USDA rural development loan. There’s a few factors involved in the USDA loans – income levels and the location of the house you buy both matter. As the name says, it’s for rural housing – no downtown Memphis condos for me. That’s a-okay with me, since what I’m looking for pretty much requires “rural.”
Here’s what I’m looking for at this point in my house hunt….
- 3 bedrooms
- 2 bathrooms
- A kitchen I can continue to enjoy cooking in
- Enough space to live in comfortably
- A 2 car garage (or a preferably a big ol’ shop outbuilding)
- 2 acres or more
Unfortunately, I’ve already learned I will probably have to compromise on the shop space, because lots of houses here don’t even have garages, and the outbuildings they have are for basically riding lawnmowers (1. whoa, we’re definitely not in California anymore, toto. 2. That’s way too small for multiple project cars).
The first day I met with an agent, I saw 6 properties. All of them met the requirements, but I liked none of them enough to warrant making an offer. Thankfully, once that first long day was in the books, I’ve been able to see one or two at a time, and I’ve had better luck since then.
The first house I liked had everything but garage or shop space, but came with 5 acres (aka: more than enough to build a good size shop in time). I started the offer process, but the house was overvalued, and the owners just wouldn’t budge. After seeing the tax records, I realized they were just trying to cover what they owed, so I rejected the fourth counter offer and opted to just move forward on the house hunt.
Here’s the craziest part though….in California, it took a full year for me to get an offer in that was even considered; where a house wasn’t being bought out cash for well under list, while we were offering above list. So basically – I actually have a place in the housing market here. Just the fact that my agent heard back on the offer I made was crazy to me – so I’ve had to get used to that.
After rejecting their last counter offer, I absolutely fell in love with a house, which was exactly what I said I wouldn’t do. Sometimes house hunting can be such an emotional roller coaster. It is a 4 bedroom, 3 bath, 3.2 acres, at 2900 SF (!!!). And somehow was in price range. The ads called it a “fixer,” but at the walk through, the only real issues we saw were atrocious green shag carpeting and alot of wallpaper (many patterns, in SO many places). After getting info on the property lines, and deciding this was a “fixer” I could handle, my agent got the bad news….apparently the condition of the house prevents it from selling via either of the loan options available to me. So there’s that. The first major letdown of the hunt.
My agent told me that I could investigate a 203k FHA loan, which sounds like a bit of a disaster process to actually get, but it could totally be worth it. I’ve reached out to my lender about it to see if it’s reasonable (or if they even offer them), but honestly, my hopes aren’t high for a success that way. Apparently, the added paperwork and longer closing time keeps many sellers from accepting these offers. I’m still going to give it a shot (in addition to waiting for information on what the factors contributing to overall “condition assessment” of this house actually were. The scary thing about walking through a house and falling in love with it is that sometimes an inspector will tell you that it LOOKED great, but it’s actually rotting from the inside out. Thanks, termites….
I will keep updating as the house hunt moves forward, and definitely log the process of the 203k loan if that should happen – the info that’s out there is a lot of official government documentation, and not a ton of real life experiences.