We’re Homeowners Again

I have written here about how we lost all our money on an ill-advised house purchase. And yet, here we are, buying a house again! Why on earth would we do that to ourselves?

Well, for starters, we think it is worth the extra money right now to live in a detached house (as opposed to a townhouse, where we lived before). Our two boys are very active and I really want them to be able to be playing outside while dinner is in the oven, or while we relax on the patio with glasses of wine. (Boxed wine, of course.) Comparing similarly sized houses and locations, buying compares favorably to renting right now.

Little Brother can already climb this structure even though his leg is in a cast.

Little Brother can already climb this structure even though his leg is in a cast.

It seems like a safer decision this time. We have, we hope, outgrown making impetuous, poorly researched moves. There are a lot of opportunities for both of us in Denver, so our willingness to live here is not tied to one particular job (which was the case last time–and when that job went south, we were desperate to leave).

We’re optimistic it will be a good investment. Denver has a robust, diverse economy, and we bought in a neighborhood that is still up and coming. If we want to downsize when the boys are older, there’s a good chance that selling the house would free up a nice chunk of money for investment.

Then there’s the security issue. By buying, we insulate ourselves from rent increases–AND create the possibility of paying off the mortgage, eventually, and having housing drop to a minimal line item in the budget.

Despite the advantages, I’d be lying I said we didn’t have reservations. We’ve enjoyed not being responsible for maintenance, and we are not accomplished do-it-yourselfers. Will we find home ownership too stressful or expensive? The neighborhood school doesn’t sound right for our kids–will we be able to “choice them into” a better fit when the time comes?

Also, moving is hard work! This is our living room five days post-move.

Also, moving is hard work! This is our living room five days post-move.

Did we do the right thing? Did we choose the right neighborhood for our needs? Did we choose a good time to get in the market? Ask me again in five years!

Do you own or rent? What were the deciding factors for you?

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About frugalparagon

I'm a part-time librarian and mom to two small boys. I blog about striving for the long-term goal of financial independence while running a tight ship at home.

13 responses to “We’re Homeowners Again”

  1. David says :

    We own, and are stuck here for the next few years until our savings can finally pay down enough of the mortgage to free us. We bought in ’06 in a neighborhood that didn’t seem overvalued, but apparently it was. By ’09 our $122K house was worth $85K and it slowly slumped down to about $70K and hasn’t really budged from there.

    • frugalparagon says :

      Yikes, that’s a bummer! We were only short about $10-$15K when we did our short sale in 2010, if memory serves. You’ve seen a big dip in value percentage-wise–bad luck!

      • David says :

        Yeah, it sucks but it is what it is. Maybe we’ll see the market recover in my neigborhood by the time we relocate but I don’t see any cause for it at this point.

  2. Mrs. Frugalwoods says :

    Congrats on the new house! That’s really exciting! We own and we bought largely as an investment. The market here is pretty hot and we’re planning on renting this house out when we move to the homestead.

    That being said, I think buying a house is almost always something of a gamble, but, it sounds like you did your research and are in a good position. Plus, if you want to stay in that area for the foreseeable future, then you’re set. I’m with you on being detached–we love it.

  3. seattlegirluw says :

    We bought a place, but it was pretty much the best time (except for our very low down payment). We found a foreclosed property that was very cheap, so our mortgage is incredibly low.

    We’ve definitely been kicked in the gut by repairs/maintenance, but I just keep reminding myself that for each item we replace an item, it’s one less thing to go wrong for the next few years.

    • frugalparagon says :

      Yeah, there’s a certain satisfaction to taking ownership by making repairs, isn’t there? Even when it kinda sucks and you would rather have done something else with that money!

      Our research suggested that making a 5% down payment is important–it qualifies you for a variety of conventional mortgages (you can get one at 3%, but not on good terms)–and that 20% is extra-nice, but that once you have 5%, there’s not much benefit to putting down more unless you can make the full 20%.

  4. debtfreekid says :

    I bought my first house last Fall, just before my 40th bday and just after my last relationship ended. I just didn’t want to rent anymore, and I had been saving up the 5% minimum down payment for 10 years. I plan to be mortgage-free in 15 years if we stay. If not, hopefully the house value will stay the same or increase!
    Congratulations!!

  5. Leigh says :

    I bought my place (a two bedroom condo) just about 3 years ago now. Rent was pretty expensive, I planned to stay in my city in an apartment for a while, and I had the 20% down payment. I turned out pretty lucky as my math now proves owning better than renting after 2.5 years of homeownership, ignoring any changes in value and it’s also gone up a good chunk in value (about 25%).

    • frugalparagon says :

      Wow, good timing! Hope the upward trend continues! Where we went wrong with homeownership was buying a house waaaaay bigger than our then-current needs. In that case, you’re almost always better off renting until you ACTUALLY need the space.

  6. The DJ says :

    Congratulations on the new home. We became first time homeowners last year and know the feeling. We have always been renters and never gave much thought to buying. However, after crunching some numbers (and assumptions which may have been wrong) we decided to take the plunge. After living in our home for a year, I have to say that I absolutely love it – we don’t necessary take pride in home ownership, but sometimes you can’t put a price on some times – our home is a place I can see myself enjoying living in when (hopefully) I quit my 9-5 gig.

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