It’s been almost a year since we sold our first home, and I can’t believe we are back on the hunt for another. Yes, you read that right, we are a couple of crazies looking for a home during a time where homes all over the U.S. are being sold for more than 30 percent of what they would have been sold for a year ago. I’m here to tell you it’s a seller’s market indeed, and when you see some of the homes we’ve been looking at buying and the prices they’re going for, you’ll absolutely be gasping for air (I’m still trying to catch my breath throughout this process).
I should start by reminding you all that we live in California, and are looking for homes in Los Angeles county (to be closer to all of our family members). With a 7-month-old, it gets a little tough driving back and forth to grandma and grandpa’s from Orange County. We are literally turning away free babysitting because we don’t want to deal with the commute to drop off our little guy. Nonetheless, the price to live in Los Angeles was nuts to begin with, now throw in the fact that banks are offering extremely low interest rates, making demand well over supply, driving up the cost of each home, and creating a seller’s market. Thus, you’ve got the perfect recipe for beyond-expensive real estate. With all of this in mind, my husband and I thought it would be best to do what we did the first time we purchased a home – look for the worst house on the best block and work on making it our dream home. We decided on a $625k budget for a fixer, and then told our realtor to “find us the worst homes Los Angeles has to offer,” and boy did he follow through with our request…
THE HOUSE WITH THE TREE-FILLED VIEW
The first place we visited was a 1,047 sq ft two-bed one-bath house up in the Pasadena hills, located right next to the Rose Bowl. I was so excited when our realtor sent over the images for this one. It looked like something right out of a fairytale, tucked away behind flowers, foliage, and trees. The sellers were listing it for $624,000 – this was a good sign! I could hardly wait to get up there to see the house. I immediately called my dad (he does contracting work) and my mom (she is good for getting good energy and vibes from a space) to come along and view it.
When we arrived, I got out, strapped Jack (our 7-month old) into his carrier, and wore him as we all made our way up the driveway. We spotted the realtor at the front door and he waved for us to come inside. I was the first one to make my way into the house, only to be met with a really bad smell, and the following words from the realtor “So, the owner died right over there in the house.” I looked at my mom, and she reached for Jack and said “we’ll wait in the car, Jack and I don’t want to stay to find out how he passed away.” I gave Jack to my mom and decided to look around.
Every time I convinced myself we could make this home work, I ran into something that suggested otherwise. We discovered severe termite damage inside and outside of the house. There were foundational problems, like the floor being unlevel, there wasn’t much room for any additions, and the ceiling was caving in and extremely low. Let’s be honest, this would be a complete gut job, but there was still a voice in my head telling me, “it’s such a steal though, and this view is to die for”… My thoughts were quickly interrupted when the realtor chimed in to say “so, the sellers want cash for the home”. It was all starting to make sense to me now – a fixer in the Pasadena hills for $624,000 – I knew it was too good to be true. The decision had been made for us, we certainly do not have $624,000 laying around to purchase this home. Fast Forward to today – this home was sold well over the asking price, a $957,000 cash offer to be exact. On to the next fixer, or so to speak…
THE START FROM SCRATCH
With the cost of homes so high in California, my husband and I have been considering other ways to obtain our next home other than purchasing an already existing structure. The idea of purchasing a lot, and building our home from scratch has always been fascinating to me. Another reason why I’ve always considered a lot of land, was for the ability to build a home with the materials, layout, and location already in cohesion.
We found a 5,891 sq ft lot in the Hollywood Hills area, being sold for $99,000. This one seemed promising, and we were thrilled about the location. We arrived at the lot via a dirt path. At about a third of the way up the dirt path, we had to access the land by foot. As the realtor, my husband, baby, and myself (me wearing our little one again) walked up the path we were already dreaming/planning of what we could do with the space. Once we arrived, we could see a huge eucalyptus plant, what appeared to be remnants of some large cement casing, and wildlife in every direction. As field mice scattered from bush to bush, hawks roamed above, and droppings from something bigger lay on the dirt path (maybe some coyotes), it reminded me of the critters from our last home, and that I should keep in mind what sorts of animals and reptiles we’d encounter on a regular basis while living in these hills. Our realtor told us we’d definitely have to be on the lookout for coyotes and snakes (this was the last thing I needed to hear – the snake-mating that took place in our last backyard was enough to send us packing). Other things we’d learned that would come with purchasing this lot were: the cost of surveyors, the threat of a fire in the hills, and coordinating an easement with the city.
To determine if the lot of land was suitable for a house, we’d have to pay anywhere between $3,000 – $5,000 (in California) for a surveyor to come out and run a report. That said, we weren’t willing to lose $3,000 – $5,000 if the results of the survey came back unfavorably, and this is something we’d want to know before purchasing the land. Building a house on this land also comes with the reality that one day there could be a fire that destroys it and all of our surroundings. California is constantly going through droughts, which leaves our terrain in constant dry and fire-prone condition (we literally have a fire season here). As appealing as living in the Hollywood Hills is, the idea of having to build a home, have it burn down, and have to start from scratch seems scary and heart-breaking. Last but not least, we’d have to coordinate with the city to get an easement (road) built to access our home. To be honest, I could barely get the city to return my phone call to confirm the street of the lot’s location. In a nutshell, we talked ourselves out of the lot.
THE HOUSE WITH THE FLORAL CURTAINS
We found a 2 bed, 2 bath 909 sq ft fixer in Long Beach going for $545,000. This home showed real promise, and our realtor said the sellers were willing to negotiate on the price. Everything was on the up and up, and then we pulled up to the home… When we first arrived, I noticed stray dogs running free, and furniture in the street, this was not our dream area. All that said, the real treat for me was waiting on the inside of the home.
When we walked in we were confronted with an odd smell, like mildew and burnt hair (it was by far the smelliest house we’d been in) and a home that I’m sure had seen better days. After viewing a few rooms, I discovered where that odor was coming from – the basement. Apparently, the previous residents were hoarding all kinds of stuff in the basement, so much so, we couldn’t get two feet beyond the door. The garage was also filled beyond entry. The realtor advised that we not lift the door… because everything would come spilling out. All of this and the owner was only willing to come down $15,000, so this house was a “no.” Nonetheless, I was never able to see my child living in this home and very quickly was able to make the determination that this one wasn’t for us. We ended the first week of our house hunt with this house, we felt a bit defeated and needed to recharge our batteries before the next batch of options.
My husband and I are looking for a 1,200 sq ft home in a good school district and neighborhood. I believe our wants are reasonable. We understand that the closer we are to certain hotspots, the more expensive a home will be. When we left California a little over three years ago, houses in the same previous neighborhoods were going for $400 – $700k (we’re talking homes considered turn-key). Now, $400,000 will get you a tent on the beach (the closest to coastal living I’ll be getting if we purchase something this year). We’ll continue the search for our next home, but if anyone knows of any fixers in a nice SoCal neighborhood, please share. Also, I’m curious to know what it’s like buying homes in other states right now, and if anyone has any crazy house hunting stories.