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Sometimes even the best-laid plans don’t come to fruition.

Key points

  • Tenants often have no control over how their monthly payments increase or when they have to move out.
  • Buying a home may result in a lower monthly payment, but there are other expenses to consider, such as down payment and insurance.
  • A great real estate agent can guide you through the home buying process.

Several years ago my then boyfriend, my husband and I were looking for a new apartment. Our landlord was selling our unit, so we started spending most of our free time looking at online listings and visiting open houses on weekends. We lived in the Bay Area and were trying to find an affordable place from which we could easily travel to San Francisco, so you can probably guess how lucky we were. Over the two years we lived in our apartment, Oakland prices continued to rise around us, and we soon realized we had been overpriced.

After what felt like the umpteenth visit to a crummy, overpriced apartment, my frustrated brain started wondering what it would be like to buy an apartment instead. We looked at our finances, did some math, and talked a lot, and realized that it made more sense for us to look for a home of our own than to keep renting. And that’s how we ended up buying a house in one of the most expensive places in the country. Here’s what it looked like.

Give some help

Our first step was to get advice. We found an excellent real estate agent who was able to walk us through every step of the process and fully understood our situation as first-time home buyers. We didn’t know what the contingencies were, what documents we needed to have on hand, or what a mortgage pre-approval was. Not only was our agent knowledgeable about the Bay Area real estate market, but he was also a great sounding board when we were figuring out what we wanted in our first home.

We started going to open houses in different cities and neighborhoods, trying to find whatever would work for us. We had a difficult date moving out of our apartment, so we were a bit pressed for time. After several weeks of research, we found something.

The first house

The neighborhood wasn’t great, and it was at the top of our price range, but the house had been totally turned inside out. We were seduced and worked with our real estate agent to establish an offer. And, holy smoke, it was accepted! Our excitement lasted about a week, until the day of the inspection. Turns out there was a huge crack in the foundation that had been “fixed” by the flippers with what our inspector described as band aid. He told us that with one big jolt, the whole house could slide off the foundation. It’s not something you want to hear in earthquake country.

Thank goodness we hadn’t waived our contingencies, which many buyers do in hot markets to get their offers accepted. After discussion, we decided to withdraw from the agreement and continue to search.

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The second house

A house hunt is exhausting, especially after it felt like we were so close, but we persevered. A few weeks passed and our moving date was approaching. One weekend we wandered into an open house for a small place that seemed solid but very dated. She didn’t have the shard of the first house, but she didn’t have any major issues either. And it was listed for $150,000 less, which put it comfortably within our budget. So comfortably, in fact, that we realized we could do the work to improve the house and make it shine.

We were very lucky; the house was in too good condition (and price) to interest flippers, but not enough to interest buyers ready to move in. In the land of bidding wars, we placed the only bid – and were accepted. About a month later, we were given the keys to our new home with a monthly payment that was about half the rent for our apartment.

How we made it work

I recognize how extremely lucky we were to have the opportunity to buy a house, because it’s not as simple as exchanging rent for a mortgage payment. Homeownership expenses range from insurance to regular maintenance to property taxes. And before all that, you need to save enough for closing costs and a down payment, which ideally will be at least 20% of the purchase price. Because we were diligent savers, budgeted beforehand, and chose a (relatively) modestly priced house, we were able to move.

Having a realtor we trusted to guide us through the process also made a huge difference. Buying a home can seem daunting, especially for first-time home buyers. We had lots of questions and often felt like we didn’t know what we were doing. But we kept learning and discussing before making big decisions, and we ended up with a little house we could make our own.

Many people prefer to rent, even if they could buy. At the time, that was our feeling and we would have liked to continue renting in our old neighborhood if we had the means. But life doesn’t always go as planned…whether it’s Plan A (a new apartment) or Plan B (the knocked-down house) or Plan C (no renovations required). But Plan D (a repairman!) ended up being the best choice we could have made, and I’m grateful for that.