July 24, 2008: No Wonder the Housing Market is Tanking

Oreo made me walk him at almost two in the morning.  This late night walking is getting really old.  We had to go for a long walk too – out around the block.  Way more than I was wanting to do in the middle of the night.  Oreo’s routine is to wait until I am in bed, wait five minutes and then want to go out.  He never, ever asks to go out until after I am in bed.

We dealt with the official pre-qualification for buying a house today because we have a couple of prospects that we are interested in.  We went this afternoon to officially put in an offer on a townhouse in Peekskill but got a stern warning from our real estate agent that we needed to be prepared that our money was very likely to not be good enough for these people [downstaters.]

Apparently the pre-qualification that the banks in upstate New York use causes issues downstate because they want the same letter to be called pre-approval – even though the weight that the letter carries is the same.  They just sometimes refuse to sell houses to people because they don’t like the terms that we use, I am told.  And they may also refuse to sell us the house because they don’t approve of the type of mortgage that we are attempting to use.  This, I am told, is because there is no faith in our bank.

We are told over and over in the news and it is obvious when looking at homes that nothing is selling.  Nothing that we have been interested in has sold since we started looking and all of the prices have just been getting lower and lower.  It seems like people would be a bit desperate to sell.  At least desperate enough to not treat people like their money isn’t good enough down here is rich, snobby downstate New York.

Just getting warned that these are likely to become problems when buying a house (a house that will have been on the market for an entire year by the time we would close, mind you) really puts me off from the buying experience.  Dominica and I are nervous enough about spending this kind of money in such an unstable market but to the then be treated like we are dirt for offering to buy someone’s house that they seem pretty desperate to sell (their agent literally calls daily looking for a status update) is rude and insulting.  It took no more than that conversation for me to already wish we were renting this year rather than trying to buy.

With buyers being treated so poorly and sellers seemingly having no interest in unloading their homes it is no wonder that the entire housing market is completely falling apart.  How can anyone buy a house under these conditions?  Our bank was very impressed that we were doing everything right and felt that we were the perfect home buyers (great credit, cash reserves, low debt, previous mortage with the bank, etc.) and I don’t think that doing things considered “less conservative” for the sake of the seller’s crazy financial sense is a good idea.  There is a reason why they are stuck in a bad financial situation and are trying to dump their home at the trough of the market.

We got called within an hour or two of putting in the office.  The sellers aren’t even willing to discuss the offer with us – no counter offer.  Strange but true.  They are desperate and have been calling every day to find out where we are in the process of making an offer and once we made, what we and our agent thought was a very reasonable starting offer, they won’t have anything to do with us.  Rather cocky in my opinion.  So we just walked away.

We went ahead and put in an offer on another, more expensive, townhouse that we had been interested in.  We will find out tomorrow, I expect, whether or not they are even willing to talk to us about our price.  We had these two in mind and we had a bit of a problem deciding which one we were the most interested in.  The one that we didn’t get (and aren’t even going to attempt to talk to again) did have an extra full bath in the basement which was very cool but the one that we are looking at now is much nicer, newer and in a better location.  It has fewer rooms which makes it a little harder for us to use but it has more space so we will be able to figure things out.

It is hard buying a house without getting emotional about it.  You start to feel attached to the homes that you attempt to buy before you manage to actually buy them.  This can cause really bad buying decisions if you are not being careful.  We need to keep in mind that this is an investment and not something that we are doing for forever.

We spent the evening watching the first season of Frasier which is really interesting as neither of us have seen very many of the episodes from this season.  The sixth episode is the very first one that I can even be sure that I have ever seen.

Dominica picked up food from On the Border on her way home since she didn’t have to go get Oreo from daycare.  They have pretty good food and it is easy for Dominica to reach on the way home.

Much of our night was spent in a back and forth bit of bidding on the second townhouse that we were looking at.  Around final bid was accepted at 9:20 this evening.  So it is “official”, we are now in the process of getting a townhouse in the Chapel Hill neighbourhood of Peekskill, New York.  Now we have to get the engineer and lawyer involved and get everything finalized with the bank and get all of the final ducks into a row.  We spent more than we had hoped but well within our predetermined “safety zone”.  The townhouse is nicer than we had planned but we got a good deal on it, we think, so we are happy.

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