Ack! Ack! Ack! Is this what buyer’s remorse feels like? Or just knowing that you must be 100% crazy?
Yesterday Karl and I agreed to buy a house in Detroit. Well, a pile of bricks, really. Detroit isn’t the scary part — we’re thrilled to be official Detroiters; the scary part is that we bought this house at the same time that we are moving and starting new jobs. Go big or go home, I guess. Plus, this house doesn’t even have plumbing. Or electrical. Or a bathroom. But it does have beautiful bones. And it was a bargain at $35,000.
The $35,000 part isn’t so scary. Everyone knows about the endless piles of cheap homes in Detroit. What they don’t understand is that $1,000 or $10,000 or even $35,000 doesn’t really get you move-in ready. In some neighborhoods it gets you closer. In our new nabe, the West Village, it gets you a pile of bricks with character. And since not a lot of lenders are really thrilled about doing business in Detroit (not to say there aren’t any, but…), we’re cashing in our life savings to fund the rehab of this 2,200-square-foot dream. And by life savings, yes, I mean our retirement fund. (There is one federal loan program we might qualify for — the 203(k) — in the future, but right now it’s not an option.)
So what do we think this will cost us? $185,000, including purchase price.
No, we don’t have all of that money now. We are going to have to do much of the renovation in stages. But if we finish the project, stay married and don’t kill each other, we’ll own a piece of history in a town that we’ve both fallen for hard. And, we’ll have no mortgage or massive rent payment (see ya, $3,200/month Brooklyn rent!) while the rest of our friends in other places are still indebted to their lenders and landlords.
Of course, the personal finance editor in me is screaming right now. You idiot! You know better!, I’m berating myself. You’ve done this before (well, without any of the savings part)! This did not turn out well for you. Plus, your retirement savings?! Are you insane, woman? WTF?
But, extreme situations call for extreme measures. And Karl and I don’t choose to live in places where normal is, well, normal. We choose to live in places where life is actually a little harder, where the traditional paths and methods don’t work, but we get a strong community in return. We get to be a part of something. And yes, we know all the history and stories and hating on Detroit. Whatever. It’s our kind of town. As the saying goes: Detroit hustles harder. So we’re hustling.
So what does that mean. Well, we’re finding out. We have some basic information, but we’re doing this a little blind. (Of course, we are…)
We are buying the house from two lovely ladies who currently live in Boulder, Colo., just outside my hometown of Golden. It’s a crazy small world. We met a woman at an Open City event in Detroit, and she told us about this house and gave us a phone number for the owners. We drove to Detroit to see it, fell in love with the house and then fell in love with the neighbors. They came out to greet us, talk to us and grill us a little. The first question: Do you intend to live here. I knew what they were asking in code: Are you a scumbag investor who will just sit on this property and let it rot while you sun yourself in Florida? No, we promised. We want to live here. To make it ours. To be a part of this community. We think they gave us their seal of approval.
We went away, but the house stayed with us. It wasn’t even on the market yet, so this seemed like one of those kismet-type things that you only hear about in novels and stories of old New York real estate. We Skyped with the owners. We talked. We debated. Karl loved and wanted it; I hated the idea and didn’t want the risk. I loved and wanted it; Karl hated it and didn’t want the risk.
We went back to the house. I looked it in the eye; it stared back at me through boarded up windows. Now, I said. Now is the time. If you want us to live in you, if you want us to have our lives here, you need to tell me now. This is your chance. The house thought about it and came back with two signs: First, a lovely grey cat walked across the roof and stared at us. Second, dusk settled in and a street light came on. Holy #$*! we have a street light! In a town that is known for its lack of street lights (and many other city services), we have our own puddle of gold right outside our window. Amazing!
So on May 1, we agreed to buy the house. Now we’re hoping our marriage can survive.
Here’s what we know we have to do (for now) as we move forward. Forgive me if this is boring, but I’m hoping to use this space to keep track of the process for the future.
- Get a purchase agreement, which a local realtor is going to draw up for us.
- Work with the title company to get title insurance and complete the close.
- Put money in escrow. This is a little backward, you normally do that when you get an accepted offer, but this is more of a handshake deal. We Skyped last night and agreed on all the particulars. Now we just have to execute them.
- Get the plans from the current owners. One of them is an architect and she is giving us the plans she had drawn up.
- Find contractors.
- Learn how to be handy.
- Learn how to get building permits in the City of Detroit.
- Cash out life savings.
- Stay calm (me, primarily).
Here we go….
And for those of you reading (which I’m sure is just our families)… if you want to help out with our project, well, we could use appliances!
Remember, we got married last June and nobody had to pay for a wedding or reception or honeymoon. Heck, nobody really even had to buy presents. So if you feel like kicking some money into our SmartyPig account for this, we promise to throw you a lawn party and have a proper wedding when this is all over! (Stacy Cowley says this is bad etiquette and that Emily Post would be sad with me. I say, oh well. We just cleared out our life savings; I’m not above begging or getting a disapproving eye from those with better manners than me.)
You can keep following the story here. But if all the words get in the way, follow Karl on Instagram.