Marisa and I got engaged in December 2010. We were renting a great townhouse in Seattle's Queen Anne neighborhood which we both enjoyed greatly. Traffic to work on the east side was a little cumbersome (or awful if you ask her), but it was just accepted as part of where and how we lived.
A few months down the road we started looking at buying a house. Our wishlist included staying in the neighborhood, a single-family house with 3 bedrooms, an office, open floorplan, modern look, 2-car garage and some other stuff I can't remember anymore. We searched on Redfin and started going to some open houses and quickly came to the realization that almost every such home in Queen Anne is either over 100 years old and smells funny, or it has been renovated but still smells funny, or it has been renovated to a style we hated, or is well over 1 million dollars, or is on the very north slope that we weren't as enthused about anymore since its walking proximity to downtown is pretty much not applicable. Thus we had to expand our search.
We considered a lot of neighborhoods, but most had some drawback:
Magnolia - despite an agent's insistence that "it's 5 more minutes to everything", it's clearly not. It's accessible via 2 streets, and gets all kinds of backed up during rush hour.
Fremont - Similar issues to Queen Anne, also not quite our style of neighborhood
Ballard - Cool neighborhood, but definitely 'far' considering we commute to Microsoft every day
Greenlake - Has some upsides, highway-adjacent. A lot of newer homes were skinny townhomes.
Montlake - Most houses are quite old and it's somewhat in a limbo zone
Bellevue - Generally quite expensive. Only reason to go there is Bell Square and there's plenty of parking
Kirkland - A little less expensive, has its own character, but far from downtown
We officially started looking in November of 2011, meaning we actually signed up with Redfin and took our first field-agent guided tours. By now we'd settled on Kirkland being the likely location of our future house and we basically evaluated every house that came on the market anywhere close to our budget. Things were slow in the winter and we quickly exhausted all options. Houses trickled by, but we didn't see one we'd even consider making an offer on for months.
Our first serious candidate was a semi-renovated house in Bellevue's Cherry Creek neighborhood, listed for $700,000, but had a fair market value in the $600,000 range. It had unique touches like aggregate concrete floors and an interior courtyard. It also had a number of renovation fails, like brand new calcutta marble countertops on top of the original cabinets (from 1971) in the kitchen. We liked a lot of things about the house, but the kitchen needed a full remodel. We started looking into the cost of a remodel only to find that a) it's almost as much to salvage an installed top as it is to buy a new one and b) marble is a poor choice in a kitchen anyways because it reacts with acid (ex: lemon juice). We did some estimating with a Home Depot designer to get an idea of what new cabinets and counters and all that would run and came in somewhere around $30,000, which seemed reasonable, especially when paired with the FMV of the house. There was a ton of interest during open houses but no market activity, so we figured people were either turned off by the unique touches, or were too shy to offer $100,000 below asking. Either way, we decided to feel out their agent. They re-iterated that they were willing to negotiate, but that we should consider that it's a great neighborhood and that a brand new elementary school was being built down the street.
Side note: the 2 other houses on the block that sold within the previous 6 months also were in a great neighborhood and had a brand new elementary school being built down the street. $600k was derived using those as comps. You can't double-count positive features. Want me to tell you I don't like the floors in this corner of the room, or that corner?
Short version: their agent told us not to even bother making an offer in the range we were thinking, so we shrugged and moved on. Sure it would have been great if we could have talked them down, but it just wasn't going to happen. A couple months later, we found our house. Lest this just be a story about us, I'll add some things to think about:
1. Know what you want, and be ready to buy when you see it
1a. Know what doesn't work for you and walk away from it
2. Be realistic about what you can buy. Don't hold out for something that just won't be on the market.
3. Look above your price range too. You may be able to negotiate, and it will help you get a clearer picture of what the next level up looks like, so to speak. If you're consistently seeing houses you like starting 20% above your budget and none within, you need to re-evaluate your search parameters.
4. If you've spent a couple months looking without seeing anything you like, re-evaluate. Are your expectations realistic? Should you look in another neighborhood? Will you need to do some renovation to save costs or morph a house to what you want?
Don't settle for something you don't really want. Sometimes that means putting your house search on hold and waiting until you have more money. Renting isn't the worst thing in the world: it lets someone else take all the risk. While buying a house is an investment, it's also a lifestyle decision... and you don't want to spend years of home ownership and work and money on something you don't really want to live in.
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