Even before the great mortgage meltdown of 2008, I was never a believer in the concept of a house as an “investment”. Really, this is true. I had this whole soapbox rant I would do when people would talk about buying a house as the “biggest investment you’ll ever make”. Yes, I know that many, many people have made it big in real estate. But ultimately, your house is a place to live, not some kind of retirement account. In fact, with your basic 30-year mortgage, is the house really “yours”? All I’d have to do is miss a couple of payments and whatever company happened to hold my mortgage at the time would foreclose and evict me. I’m paying for housing, just like paying rent, without the benefit of being able to pick up and move if I need to, and without the benefit of having a landlord to pay for major repairs and upkeep. And should I need to move and can’t sell my house, I’ll be up the creek, having to pay for the house as well as housing in my new location.
That being said, there are many good things about homeownership. Once you have kids and pets, it’s nice to not have to worry about rental property rules and keeping the place clean enough so you can get your deposit back. You can paint and decorate however you want. And there are always uncertainties with renting. The owner can decide to stop renting the place, rent can go up, repairs can be deferred to the detriment of the tenant, etc.
Early in my relationship with my husband, I was giving my soapbox rant about a house being a place to live and not an investment, and he chuckled and pointed out that “yet, you are a homeowner”.
And I am, and have been for a long time.
I’ve learned a lot from each house I’ve owned and tried not to make the same mistakes, but I’ve found there is no such thing as a perfect house. Here is my assessment of my various houses over the years:
2031 Harrison Ridge Court: a true “starter” house, a HUD foreclosure bought for $71K. About 1,100 square feet. A cute two-story, but so, so cheaply built. For example, there was no insulation around the sewer pipes so every time a toilet was flushed upstairs, you could hear the water rushing down the pipes as you sat downstairs in the living room. Lovely. It also had the thermostat right by the front door so every time the front door was opened, either the AC or the furnace would turn on, whether it was needed or not. And the placement of the furnace was such that it made a deafening roar that drowned out the TV and normal conversation. In the summer, the upstairs was unbearably hot. My ex-husband and 22-year old son still live in this house. I believe this area has been hit hard by the mortgage meltdown and this house, 22 years after we bought it, is probably worth much less than we originally paid for it.
Lessons learned: Yyou get what you pay for, starter house neighborhoods don’t stay stable for very long (hello, 12 people crammed into a 3-bedroom house with front yard serviung as parking lot), and square footage is key—the closet sized bedrooms that work for a baby and a 4-year old are woefully tiny as the children and their accoutrements grow in size. And thermostats should not be anywhere near an exterior door!
305 Townsend Terrace: This house was huge, over 2400 square feet, but on a busy street corner and not in good repair. It was constructed of cinderblock, completely uninsulated, with ancient metal casement windows that wouldn’t close all the way, so it was cold in the winter. I paid $83,500 for it which came out to less than $30 a square foot. There was plenty of room but a lot of it was wasted space and ended up just being closed off most of the time. Interestingly, this was the only house I ever made money on. I sold it for $130K after living in it for less than four years. Home prices were going up and I benefited from the gravy train.
Lessons Learned: Busy street corners are noisy and people like to throw trash out of their cars. Insulation is important. Big houses mean more work and more money. Every day the toilet flushes without event is a good day.
2004 Rose Lane: This house was ug-ly. A hideous one-car garage extension had been put on without any consideration to how it fit with the design of the rest of the house. Irrigation pipes, wrapped in crumbling black insulation, had been installed across the front of the house, in full view. It was horrible. I still don’t know why we bought it. We did everything “right”, getting the home inspection and all, but this house had SO MANY PROBLEMS it was a true money pit. I can’t even begin to describe everything that broke in this house, but a lot of it involved plumbing and big, watery messes. We did a ton of work to it, not just repair but a lot of improvements, and made it absolutely beautiful inside. It had a nice flow to it, a big family room area with bathroom that we used as a teenager suite at various times and a beautifully private back yard, a huge shed that had electricity and tons and tons of storage space, but it was just one car away from a busy street and with the old single-pane aluminum windows it was noisy and cold inside. After one too many major repairs and a neighbor accidentally crashing her car into the house, necessitating months of fighting with her insurance company and dealing with contractors we just couldn’t bear it anymore. I paid $141K for the house and joyously sold it for $150,000 four years later even though we had probably put close to $50K in repairs and improvements into the house, including adding a back screened porch and completely replacing the entire air conditioning system and ductwork, remodeling a bathroom and replacing all the flooring. The day we went to the title company to sign the papers to sell the house was one of the best days of my life. Literally.
This is an actual picture of the neighbor's crashed car in our house.
Lessons Learned: We bought this house from a slumlord (excuse me, real estate investor in trailer park properties) who lived out of town and used it as a sometimes winter residence and didn’t care about it, and it showed. Busy streets have cars on them at all hours of the day or night. Get a home inspector you really, really trust (ours completely missed rotting ductwork that cost thousands to fix). Look at the neighbors’ houses before you buy and determine if they seem to be running a permanent yard sale, junk business or used-car lot from their residential property. Don’t over-improve. The day I realized how much it would cost to replace the aluminum windows, added up how much I had already put into the house, and how much I’d ever be able to sell the house for, was the day I was done with it. Third replacement of kitchen floor due to yet another plumbing problem contributed to my ultimate hatred of this house.
Current House: We tried. We bought it from people who lived in it for 30 years and had maintained it beautifully. It has new windows, double paned, low E. A metal roof that should last a lifetime. The master bathroom was remodeled and enlarged with a whirlpool tub and glass shower enclosure. The master bedroom is spacious but not cavernous—perfect-sized. It has refrigerated air and you can switch from AC to heat at the push of a button. It’s mostly a great house. But perfect? No, not at all. It’s about 200 square feet too small and has an old-fashioned layout that was hard to fit our furniture into and results in wasted space There is no place for large storage. The garage doesn’t have access into the house. It has an unheated, ancient swimming pool that we can only use for about three months out of the year because the water gets so cold. But we’ve decided this is the “forever” house so we’re staying. And we’ve certainly had repair issues—a hot water heater that sprang a massive leak one day and had to be replaced, irrigation pipes that burst, sending cascading streams of water down the street (just as the codes officer happened to drive by!) , but so far (knocking on wood here) nothing too terrible.
Lessons Learned: Storage space is important. Access from the garage directly into the house is nice. Make sure the built-in drawers under the kitchen counter all stay shut properly. Shag carpet and pets just don’t mix. When the pool is your own to worry about and take care of, it’s a lot less fun.
Conclusion:
I know there is a huge industry of many professions built around homeownership (mortgage lenders, bankers, title companies, loan servicers, home inspectors, home improvement contractors, insurance companies, HGTV, surveyors, etc., etc.,) and it is a huge economic engine, but it seems to depend so much on the concept of more, more , more, moving up, getting the better, bigger house, constant improvements, granite countertops, multi-head showers and making people not satisfied with what they have. I fall into this trap myself, and it’s not sustainable and it creates angst.
Nevertheless, I guess I’ll keep being a homeowner for a while. Where I am in my life, with five pets and a child still at home, it works for me. But if I ever have to go back to renting again, I certainly won’t look at it as “throwing money away”, because it’s not. As my dad, who has NEVER owned a home, always says, you’re paying for a service. A landlord to pay for the repairs, no maintenance woes, freedom from house chores on weekends, and the ability to pick up and move whenever you need to. No grass to mow or siding to paint or roofs to replace? Freedom . . . peace of mind . . . tranquility—if that’s where you are in life.
On the weight loss front, nothing good to report. Not abstinent (though not spiraling completely out of control yet) and up two pounds. Went to a meeting and had a great chat with my sponsor last night, but high stress level is keeping me away from working my program with any consistency at all. Not good. Stay posted!
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