My husband and I are working on paying off various credit card, student loan, personal, and real estate debts that have added up over the years to quite a significant amount. We're in the middle of a five-year payoff plan for most of the non-real-estate debt, and looking forward to having a little more flex in our monthly income-to-expense ratio. (We do have a longer plan to pay extra on the rest of the debt and get it cleared sooner rather than later, but on a slightly less aggressive scale than we're currently pursuing.)
So buying another house wasn't really anywhere on our radar. (We own two houses already, one we live in and one that's a rental; both are mortgaged and unfortunately not yet quite recovered from the bursting of the real estate bubble. I hesitate to call the rental an income property, because we've yet to see a profit on it (even excluding things like the occasional expense and deprecation, we're only at about a break-even level between the mortgage, taxes, and insurance.) Even further off the chart was the thought of buying a house down South -- in fact, down South was never even a topic of conversation, except when my in-laws would talk about heading down to visit family every summer when hubby ("S") was a kid. He'd never been down there in the 17 years we were together, except a whirlwind trip several years ago to scatter his uncle's ashes.
Then, two years ago, his mother died. (His dad had died a year and a half earlier.) After we sorted through all the things in the house, there was a section that he thought should go to the Tennessee relatives. So he made some calls and scheduled time to head down there. And he fell in love. (With the area, not another woman!) The next fall he talked me into a long weekend trip (we have several critters, so both of us away from home at the same time takes a bit of strategy and multiple friends who will help out), and I could instantly see the charm of retiring down there. My own paternal grandparents retired in a similar area, though a different state, and I don't think they ever regretted a day of it. Moderate weather (well, compared to our mid-northern climate, anyway), beautiful scenery (nestled in the foothills of one of the big mountain ranges), lots of cycling opportunities for him, and close enough to 'civilization' that I wouldn't go stark-raving mad. (I like solitude and long for the day when my closest neighbors are a mile down the road, but after growing up in a county with one of the highest amounts of retail space per capita, the thought of driving an hour to the nearest Wal-Mart is a little over the top for me!) The key word, of course, being "retire". I still have family here, my sister just recently moved back after 20 years of living several hours away, and she brought along her daughter, my only niece and the closest I'll get to a kid of my own. So I'm not ready to pack up and leave home yet, and since S's job is here and he likes it a lot, we were pretty much in agreement about the retiring thing.
Fast forward to early this year, after S had taken several trips down South and gotten close with his cousin (second cousin, technically), B. The house next door to B went up for sale, on a foreclosure, and B was quick to call S and let him know. (B and his wife, L, have been very anxious to get us moved down there. I'm not exactly sure why, I guess it's just a family thing. S is related to probably 75% of the population in the small town of what we'll call Walnut Grove. Every time he goes down there, he meets some new "kin". It's a bit overwhelming for me, since I come from a very small family.) We talked about it, and agreed that S should make plans to at least go look at it: it would be convenient to have a place for him to stay when he went for cycling trips without always imposing on B; we could bring at least some of the critters with us, making it easier for both of us to go; and most importantly, my mom was interested in the idea of having somewhere in that area to stay on vacation. (Since the funding would no doubt in one way or another be provided or supported by my mom, it was important to have her buy-in.) We agreed, also, that if it were any other situation we wouldn't even be discussing it -- we weren't looking for a house in Walnut Grove, and the only reason we were taking the time to look at this on was because it was a good price and it was right next door to B, so he could easily keep an eye on it and keep up with things while we were gone.
Of course, once S gets an idea in his head, he's like a dog with a bone. He's yet to have a gift card for more than a month -- once he's got it, he's got to spend it right away. (I, on the other hand, still have gift cards that I received several years ago, because I don't want to spend it until there's something I really want to buy.) So the next thing I knew, here's S, looking at houses in Walnut Grove. We did look at several, and I'll admit I kind of had fun with spreadsheets and appraisals and navigating the state assessment website, trying to figure out if the prices were appropriate and, on foreclosures, what we should offer. The, during a ride, S happened to pass by a sign that had fallen over on the side of the road, that simply had an MLS# and a price ($41,000). He texted me a photo of the sign (whatever did we do without texting?) and I did the research. The house had just been bought at auction, by a company that flips them immediately. The price on their website was even lower than the price on the sign -- $39,000. That was lower than the house next door to B by around 40%, and it was a bigger house that was more our style.
S and B did go look at both houses, plus a handful of others, but in the end it was the auction house that seemed to suit us best. Three bedrooms, for when my mom and sister came down with us, two full bathrooms (several of the others only had one bathroom, which would be difficult at best), and while the original house was built in 1900, it had been added onto a few times in the last few decades, and the previous owners had been in the middle of a rehab that they'd started when they bought it five years previously. Within that time frame the house received a new roof, new kitchen, new siding, new interior paint, and new flooring in the kitchen and hallway. Not too bad for a 100 year old base, and certainly not totally run down like some of the foreclosures we'd seen -- although it they had ripped out the carpet in the other rooms and hadn't gotten around to replacing it yet.
So we knew the house needed some work, and it was an as-is sale (no inspection and seller's concessions with a foreclosure flip!), but the price was really too good to pass up. The state has it appraised at $95,000 -- and although we've heard the state assessments aren't always accurate, based on our own comp analysis that number isn't too far off the mark, once the floors were put in, at any rate! So we talked with my mom, and made a cash offer of $35,000. Which they turned down, but countered with $36,000 -- since we were prepared to pay the $39,000 list price, we accepted. Three days later we wired the money and it was official -- we were now the owners of our third house, a fixer-upper, nine hours away from where we live. *Gulp*
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