Money Smarts Blog

House hunting. When you watch HGTV, it looks like one of the most wonderful experiences. The homebuyers are almost always smiling from ear to ear. If the buyers are a couple, they’re often holding hands and frequently exchange optimistic kisses. And the script barely changes: They pop into a few lovely places, make an offer and then we’re treated to a happy montage of them enjoying their new dream home.

When my wife and I stepped away from the TV and into reality we realized pretty quickly that house hunting was not as advertised by those lofty house-hunting shows. It was stressful and downright saddening at times. The reality is that there’s not a neatly-written script for home buying (or selling) — but here’s how we made our dream home a reality.

Step one: Start saving

My wife and I wanted to understand the market to get an idea of how much money we’d have to spend to get into a house that checked off as many boxes on our wish list as possible (and every box on our must-haves).

We had also been working to boost our credit scores for the past year by paying down the lines of credit we had open. Once we were satisfied with our scores, we contacted a mortgage loan officer to get a clear understanding of what we could comfortably afford. It’s important to note that what you can afford and can comfortably afford are two very different numbers. Make sure that you’re honest with yourself (and your lender) about what affordability means to you.

We also saved whenever we could. A little bit here and there started to add up. Finally, we were ready.

Step two: The hunt

It was time to step out of the apps and into actual homes. We hired a realtor we trusted and who was honest with us. Our realtor was blunt and bold, but the best part was that she adhered to our list, including our “must-haves.”

I have to admit, touring homes was a fun experience. It’s exciting to visualize the next chapter of your life somewhere new. And then …. they’re sold to someone else. Suddenly, all those fun scenarios you imagine fade away. At times, it was truly a heartbreaking experience for us.

Step three: The one

After months of disappointment, we found the perfect house. At this point, we were so calloused that all the hoping and dreaming had dimmed. It was hard to remain optimistic after experiencing multiple houses slipping between our fingers.

This house in particular checked off every single item on our list, so we knew we had to act quickly. We ran the numbers with our realtor, including all expenses involved in the selling/buying transaction, then ran them again to be sure.

That’s when things got a little awkward. We hired our realtor specifically to help us buy, not sell. But now, we were faced with a pretty large number on the paper that accounted for her commission fee on selling our property. The fee was large enough that it tipped the affordability scale of our dream property.

Step four: For sale by owner

We were lucky that our realtor was honest throughout our experience. She told us the only way we were going to make this deal happen was by cutting her out of the sale of our current property. She cited our “must-haves,” which helped take emotion out of the business side of the transaction.

So, we listed on our own. We used a local company that took care of everything for around $2,500 at closing, including a home appraisal, whole house inspection, professional photography, 3D walkthrough, signage, online marketing and access to an attorney’s office to handle all the paperwork.

We sold in four days — at a price above what we were asking!

I’d be crazy to think this is typical. The most valuable part of the package was the appraisal. Knowing how much our house was actually worth versus how much we thought it was worth was wildly beneficial in selling so quickly. To be frank, we thought our house was worth $10,000 more, but with our dream home in mind, we listed at the exact market value determined by the appraiser. This immediately made our house the best option within our selling price range. Had we listed at what we thought our property was worth, we may have been sitting for months.

Step five: Making the dream come true

We frantically called our realtor, who had already drawn up the paperwork for the new property (I want to stress the importance of a team that cares about you). We made an offer, which was accepted the next day.

Although the homebuying experience can feel like a nightmare, dreams can come true. The key is to remain organized, be prepared and be patient. Start saving today. Work to improve the credit scores of anyone who will be on the mortgage loan. Find a realtor and a mortgage loan officer that you can trust. It’s okay for you to dream, but make sure the team around you is well-grounded in reality.

Also, maybe turn off HGTV for a bit.

BONUS CONTENT:

Step-by-step tutorials on the home buying process