So we finally bought a house. We've been looking on and off for about 12 months although
things got serious about 3 months ago.
We first looked at the place we bought last Saturday, and walking in the door I knew it was a strong contender. We looked at three other places that day, and they all paled in comparison.
The place had been passed in at auction nearly three months before, and we were told that initially the vendors expectations were too high. We saw this as a good opportunity to negotiate and try to broker a good deal. The market had been slumped for a few months and the early figures for the quarter had
indicated a ~2.5% drop in median house price for the city.
We did another inspection on the following Tuesday and enlisted all of the troops (extended family) to give the place a good once over. We then sat down and signed a formal offer. It was rejected. We upped the offer $5K and it was accepted, although at the insistence of my wife we made the offer contingent on the outcome of a builders inspection.
A found a company in the yellow pages and had the inspection done on the last day of the 3 day cooling off period. The building and pest report was incredibly detailed, providing photos and a room-by-room summary, inside and out. We learned a lot about the types of preventative maintenance the place will need over the next 5-10 years, and more importantly, we learned that the upstairs balcony had some major structural problems.
The report said that the wood used was popular in the decade that the balcony was built and was known to rot unless property treated. Rather than expecting the vendor to return the balcony to new condition, we made an offer to split the difference, deducting half of the cost of the repair from our offer.
All of the negotiating occurred on the last day of cooling off period, a Friday. I had my wife on one had, adamant that she didn't want to pay a thing to have the balcony fixed, and the agent on the other hand threatening to open the property for inspection on the next day. I really liked the place and I was feeling totally strung out (to say the least).
We managed to broker a deal in the end and initial the final amendment on the Saturday, one week from our first inspection. With previous auctions and negotiations, I tried to remain emotionless, time was on our side and we could wait for a deal. I really liked this place and it was beginning to dawn on me that our remaining time to find a place (before the baby came) had shrunk to a matter of a few months. We're both happy we finally got there and have high hopes for turning the property into our home.
We learned a lot throughout the process. My analysis of
median house prices,
suburb selection,
crime rates, and even
travel time studies months ago were interesting, although in the end did not directly affect the outcome. Even the detailed suburb house price regressions I was building up were not used, as we ended up buying in a completing different suburb, inspecting the house on a whim.
I was told early on that buying a home is different from buying an investment, and it bit me in the end, because its emotional. If/when there is a next time, at least our expectations - that it is a long hard emotional roller coaster - will mean we'll be better prepared. Hopefully.
Rather than letting them go to waste, I'll post some regression analysis for a selected suburb soon.