Other Paths to Buying, Part Two
We are busy creatures of habit. Automatically buying the same peanut butter won’t impact our lives terribly. But our stuff and needs, our taste and finances change, but so does the world! Decisions about the what and why of our spaces deserve thoughtful review.
Recently I wrote about “no inventory” mindset. All the time I see sellers who want to buy, but don’t see what they want, think they need or can actually afford, and sit, stuck and unhappy. For buyers who really want to buy, I first suggested some internal review. This post is about newer, external paths to consider.
>Consider a renovation mortgage: FHA and Fannie Mae have products that roll renovation costs into the mortgage loan. Because I don’t do mortgages, here is where I say you need to speak to a qualified, licensed mortgage broker for details. I did, here’s how David Moore of Hudson United Mortgage outlined it:
Could be ideal for those who have the time and grit to see this through, but maybe not the cash on hand to get the necessary work done. Some pluses:
- Buy a house typical mortgage products might not allow (Fannie Mae-who funds around 70% of all mortgages does not finance houses with outstanding health, safety or CO issues)
- Amortize renovation costs over the course of the mortgage
- Streamline the process because contractors are pre-approved, and paid directly by the feds
- Make the updates, and get the house you want
These are not necessarily for distressed properties! FHA’s standard 203K loan is best suited for larger projects; but a limited 203K, or Fannie Mae’s HomeStyle loan might work for for you for minor repairs and cosmetic updates. .
It’s a federal program; lots of details, rules and paperwork. Some big banks have dropped these programs because their general mortgage servicing wasn’t so well equipped to sheperd these programs through. Seeking lenders who have experience, and a team dedicated to these products would be wise.
>Reconsider what renovation means today
When I first got into this business, decorating and renovating were part sport, part entertainment.
Custom was king; bigger was best, and intricate detail and pedigree meant everything. So if you’re shying away because this was your last recollection too, I have good news!
Quality never goes out of style, and costs will always be considered. But most people today don’t want, like or need much of what made renovation so costly, time consuming and complicated.
Today’s consumers have sobered, opting for substance over style. Smart design, solid infrastructure, and green choices win over imported materials, ornate mouldings and specialty finishes. And suppliers got the message, having snazzy and sustainable materials at the ready.
>Consider updating and staying
It’s a thing! While searching for this article I read last year about a Portland homeowner who hired a decorator and renovated and stayed instead of moving, found many many more with the same story: Chicago, Delaware, Seattle, and including this one from Escondido CA in the Business section, with lots of demographic trend info.
People are moving less, for a number of reasons. Selling and moving costs add up quick, and for most that have to sell to buy, there’s the added uncertainty of where they will go.
What I loved about the Portland story was that it was the homeowner’s seeing what the identical unit looked like updated. It is an absolute truth, very few people can imagine anything else other than what’s in front of them.
Really really ready to change your living circumstances? Talk with some pros, consider some new paths!