Wednesday, May 30, 2012

Day 11: On Unwanted Roommates

So, my offer was countered and the bank asked for more money. I visited the house today because I had not had a chance to preview the inside. It is lovely. As soon as we walked in, however, I heard a door shut. I said to the realtor, 'Someone is living here...they just left out the backdoor." She asked if I was certain and I was.

I suspected someone was living there the first day I peeked in the windows. I saw plastic cutlery on the floor in one of the back rooms. Also, the window was open. And, I felt like I was being watched.

We walked into the house and my stomach has butterflies in it. In the back I saw a rather nice bike and the crusts of a recently consumed peanut butter and jelly sandwich. No doubt someone is staying in the house. The back door was also unlocked.

After looking around and deciding the house has great bones and potential, I signed the counteroffer. I am soon to be the transient's landlord! I left a note on the bike thanking him for being neat and respecting the property and that I was sorry he had to move. I wished him the best. I hope whomever he/she is they have a heart and move on without vandalizing the house. There are many, many more vacant homes in the city for someone to crash in.

If the house is vandalized, I can get out of the contract. Paragraph 11: House shall be maintained in the condition at the time of the offer.

I wish the bank would install new doors. I really want peace of mind.

Sunday, May 27, 2012

Day 8: No Jinx

I so don't want to jinx this, but I put forth my strongest offer on another house. This time the house has only been viewed by me in photographs (I get a 10 day inspection period if the offer is accepted). I offered very close to asking price, cash, and as an owner-occupant (15 days first priority). I don't know how I could have made it any better. We did miss the 15 day owner-occupant period by a day (the math is funny on the Homepath was listed on the 12 which by my calculations would have made yesterday Day 15; however, the site listed Friday and the last day.

Now I am hoping beyond hope this house has electricity and plumbing like the photos. It was not on the market long after the photos were posted, so unless someone broke in this week, the house should (fingers crossed!!!) be "as is" according to the photographs. I do know the roof has leaked. I hope to go peek in windows tomorrow or Tuesday.

If the major systems are working, I can get it inspected and repaired quickly after closing and move in for the rest of the repairs. The house has a lot of potential, but like all the others I can afford needs a lot of work and TLC.

Oh, and the new realtor is great. I'm glad I switched.

Saturday, May 26, 2012

Day 7: Cry

So, once again I've probably lost. This time the realtor dropped the ball on getting my paperwork in on time. See, the house of interest is a Homepath house with a 15 days Owner-Occupant period. It ended yesterday. She had told me she would have the paperwork ready by evening, but 8 came and went and I finally texted her a general "How's it going". She responded closer to 11 with a statement about another buyer's issue and that she wouldn't be able to get to mine until early the next day (today and it is 9 am the next day as I write this). I checked the Homepath website and the "first look" symbol is gone which means the house is now available to all interested parties. Now, I must compete with the big dog investors and they force you to go above the asking price. I don't have the capital. I am going higher this time around, but I doubt it will be high enough.

I am so frustrated. I just want to pay cash for a house that I also plan to live in. I prefer a house with electricity still in it. Maybe a toilet. I'm beginning to think the stars are against me being a home owner in Louisville. I refuse to take out another mortgage.

I am running out of time...two months left in my apartment.

Friday, May 25, 2012

Day 6: Another Part of the Story

Here is an interesting experience I had the other day while at the house by the tracks. I was sitting in my vehicle on the phone waiting on the realtor. I saw a couple of cars drive by and glance my way. The part of the street the house sits on is a small stretch dead ending at the railroad tracks. Both houses on this section are boarded up. Almost all of these vacant homes I've been viewing have been boarded up.

One of the vehicles, a newer SUV went by and then returned. They pulled into the short piece of road and blocked my vehicle. I told my friend I was letting her go (at first I thought they were pulling up next to me to ask me something). Soon after, out jumped 4 men in black t-shirts and khaki shorts. I grabbed my badge (part of my job I'll talk about later) and started to hop out of my car. One of them reached into the driver's window and turned on a red blinking light behind the rear view mirror.

I got out and said: "First, I'm waiting on a realtor to show me the property. Second, I'm an officer..." I showed them my badge. The one guy says, "Are you thinking of buying this place to rent out?"

Um, no...

I said, "Actually, I'm looking to buy and occupy a house in this area."

All four looked squarely at this 5'03" petite woman and I saw "crazy" written like stars in their eyes.

I stated, "I'm really glad you guys showed up's a great sign you are watching out for all these vacant homes and the community." They just stared and nodded.

Of course, I'd love to ask where the hell they were when the house was broken into and vandalized. I also didn't ask for their credentials and for all I know they are part of some West End Mafia. I guess that would be interesting!

Thursday, May 24, 2012

Day 5: The Hunt Part II

I ended up calling her to say I was firm on my price and she said I should wait for a price drop. Now this girl has not offered me any advice until now. She never told me about this 5% rule when I made the other offer and even when they emailed asking for my 'highest and best'. She started telling me that the banks, after all the fees and taxes and other losses, would not go for a small offer. I wanted to say, 'Yeah...fucking banks!" However, I ended up saying that the banks would rather these houses rot into the ground instead of letting one go for cheap. I told her I lost 40% on a property in 2010 and no one seems concerned about that loss. I really have no sympathy for banks. And, the banks do not care about Louisville. They own or sell homes to uncaring investors and the blight continues.

I probably would have gone higher on that house I lost, but without any feedback I was scared to bid a lot. I had read that banks play these games and I didn't want to up my bid unnecessary. I want a good deal; I want to spend as little as possible on the purchase price so I can spend more to fix it up. It's a stacking game that investors are better at playing. How I see it, it will not be long before only a handful of investors own all the properties in low income areas.

She also never mentioned Homepath Properties where owner-occupants sign a contract saying they will stay in the home for 1 year (this is an option for me) or, if investor bought, the homes have 3 month deed restrictions. These houses have a 15 day preference towards owner-occupants.

Further, she never answered any of my emails directly.

So, I let her go. I need a more assertive agent. I realize they are not going to make much commission off of this deal, but, in theory, I plan to sell this house someday and I may buy others down the road. This is like a reduced price trial offer. I need someone that will guide me a bit better to help me fight the investors regardless of their commission. I am asking for the moon, I realize.

I think I found her. She is the mother of one of my co-workers. I sent her a Homepath property I like and I hope to place a bid by tomorrow on (yet) another property. This time I am doing so with only seeing photos (I'll put an inspection contingency on it).

It does suck that houses are selling less than economy vehicles now.

Day 5: The Hunt Continues


I lost my first 'official' offer. It took the bank exactly a week to decide. I was outbid due to being a bit conservative on my price (I think) and the fact investors can afford more overhead in the purchase price. As my friend R. likes to say, "You haven't found your house yet..."

So, I moved on and went to view a couple of more. The first one is really cute and still has the original wood doors and moulding. It also appears to still have it's copper, but I'm not 100% certain. The negative: both houses are boarded up on either side and the neighborhood is quite run down. I felt uneasy there for some reason (and this is odd for me). Ironically, it is not on the West End, but more south-central (near the house I lost the bid on).

The second house is a little shotgun next to railroad tracks. It sits on a big lot and someone even built a functional chicken coop in the back yard. Vandals (more than likely bitter X-owners or kids) have broken in and painted graffiti in one room (very easy fix), busted the stone fireplace, overturned a toilet and busted out plaster and lath walls. Still, it has some potential.

And this is where the story takes a discouraging turn...

While at this property, the agent helping me starts to hint that there is little commission to be made on these and that a lot of agents would just say, "Oh, we can't get into that one." Now, to be fair, I have looked at probably a dozen houses on my own time and have only asked for an inside view (which requires an agent) three times. I'm pretty good at narrowing down what I need. In fact, I had sent her an email saying I was willing to place the offer without a view (I'd peeked into the windows) and the amount. She ignored this email and set up a viewing.

This particular house is priced way over the other ones I had looked at ($12,000), yet it is in a degrading neighborhood, is much smaller, and needs just as much or more work. I chose a number I feel is fair based on the cost of repairs I will need to do and the comp values of the neighborhood ($7400). She replied she would put it in if I really wanted her to, but that the bank would only go 5% less. What? That means the lowest they will go is $11,400. The house needs at least 10K in repairs and the average selling price of homes in the neighborhood is $23,000 (all of the higher selling ones being in far better condition and in a bit better areas). And, as we realists all know, houses are still Depreciating. Paying 12K for this house is just not an option.

So, I told her I would get back to her...

Saturday, May 19, 2012

Day 1: New Adventures

This is a record. A historical document of my adventure of home ownership in Louisville. A crazy timeline of deciding to be brave and move to the 'seedy' part of town. A chance to be mortgage free and own my own piece of the city by the Ol' O-hi-o. Keep your fingers crossed the bank takes my cash...

House one is a 1900 Shotgun in a decaying neighborhood Central-West. I have a low offer pending and waiting for a bank's decision. The house has been stripped of it's copper and pipes. It is a foreclosure that has sat empty for some time. The house next door is a posted former Meth lab. The bank wants more money. I want to spend as little as possible before fix-up. I wait until word on Monday (hopefully) and whether the bank will accept my low ball, cash offer.

Meanwhile, check out these inspirational blogs. Do you think we can all make a difference one urban lot at a time? Or am I just another (not crack) pipe dreamer?

Ghost Town Farm

Emerald City, KC

The Urban Guys Farm

Urban Louisville
Left Bank

This is Louisville

Green in the Ghetto