What I learned from considering buying a house

September 23, 2015

Long story short, I was visiting a friend and learned about a house across the street from her that was for sale, extremely close to a train stop to get into the city, and when I looked up the price, surprisingly affordable. We didn't end up making an offer, but I've spent the last 2 weeks frantically reading up on house-buying (in the U.S.) and asking all the homeowners I know for advice, so I thought I'd write up that a little bit.

First, if you're just like "wat is house buying process even", my friends recommended this home buying guide written by Redfin and this other house buying guide by Michael Bluejay (as my friend noted on the latter, it looks/sounds a little spammy at first, but the content and calculators seem well-researched and logical). Reading through those demystified many of the initial steps.

Second, it was a bit different for us because we had a specific house we were looking at, but I tried to set up some additional showings through reaching out to the agents listed for houses I found on Zillow. This did not work out very well, as there was a bait-and-switch on some of them where I had to talk to them on the phone first, only to learn that the original listing wasn't even available anymore. When I said I wanted to work with people that were really good at communicating over email and maybe text, this isn't what I'm picturing...

Incentives matter a lot, with such a large purchase. When we do this process again, I'll probably find an agent and schedule showings on Redfin, since their agents are salaried and only earn bonuses on good reviews, not on commissions. They make it pretty easy to request a specific time for a house showing. I also like that they host a review system for other people you'll need in the process, like lenders and home inspectors. Hopefully this would help me avoid people trying to make a sale based on emotions like "how do you feel when you walk in" as the principle guiding system, when we haven't had a chance to rationally evaluate the objective pros and cons.

Redfin's search capabilities aren't as sophisticated as some of the other sites though. I started off mostly using Zillow (though I learned that many realtors loathe Zillow due to their whole "Zestimate" algorithm projecting home values and such, but that didn't matter to me since I just ignored those numbers anyway) but now I'm trying out Trulia, which has some very useful filtering options, like filtering by commute distance on public transit to a particular address. Trulia also has Pinterest-like board for the houses you've saved to look at, which is cool for sharing with other people you might be searching with.

Finally, I learned that the most useful way to evaluate a potential house is in terms of what would be most difficult yet important to change, and prioritize lower the items that money and/or time could fix. This is why there's that old adage of "location, location, location" for real estate--because that is the one thing you can't change. From there, some other important things you'd want to consider are large trees on the property that are too close to the foundation, as well as the general condition of the foundation itself (check this by going into the basement and seeing if it feels damp, do you see mold/rotting, are things askew). You want to be situated on higher ground, to avoid flooding, and if you like bright rooms, you want your main exposure to be facing south. Stuff like that, versus renovated kitchens or bathrooms. As long as the infrastructure for whatever you want to do is there (plumbing, gas lines, etc.) you can probably make it happen later.

Another point regarding updated kitchens is that the owners have upped the value of the home based on their renovations, but they may have made decisions about layout/fixtures/finishes/etc. that weren't what you would have made yourself, so if that's something you care about, you have more flexibility in buying a house with a crappy kitchen and spending the different in price renovating it after you're the owner.

Of course, many people are looking for places that are move-in ready and don't need much, if any, additional work. That's a perfectly legitimate trait to value, as long as you recognize that tradeoff in cost.

Anyway, looking at houses and dreaming of the possibilities is pretty fun! I now have a bulleted and sub-bulleted list of my priorities that I wrote out, which will be a nicely organized way to score future house candidates :)