Moving Into a New RE Market…

We headed to the Midwest in March, 1998 through ice and snow.  I come from a rather large Midwest family, so we were able to temporarily stay at one of my relative’s apartments until we found a house to buy.  The apartment was located in the college town of River Falls, WI situated southeast of St Paul, MN.  River Falls is the home of the Kansas City Chief’s summer camp.  The housing market there was college oriented; there were a lot of rentals and temporary housing.River Falls Home

Shortly after we moved over there, my father unexpectedly passed away.  It turned out to be good for us to live close to my relatives during that time.  We eventually were able to buy a 1970’s ranch with a walk out basement/garage for $110,000 in May, 1998.  The house didn’t need a lot of work.  It had a fairly good sized, unfenced yard.  While living there we did some minor changes to the kitchen to increase it’s functionality and we put a new sink and countertop in the main bath.

My husband had never lived outside the Pacific NW before, so this was his first experience with full time Midwest seasons.  The biggest climate change was the humidity, followed by straight line winds/tornadoes, and of course, snow all winter long.  He used to watch the tornado chaser shows on TV, but living through those storms is a whole different story.  Waking up to sirens in the middle of the night was no laughing matter.  When  I said head to the basement, I meant it!  After he first hand saw the damage those storms cause, he had a little more respect for the storms.  Fortunately, our first winter we lived there was mild snow wise, but it was COLD.  By the end of our second summer over there, we were pulled back to the Pacific NW by my husband’s family.  Honestly, I was glad we didn’t get to live there another winter.  Moving back there reminded me why I left.  I really don’t like sub zero temps, high humidity and violent wind storms.

We put our house on the market FSBO for one week and then listed with my cousin’s mother in law in September, 1999.  Our house sold the first week for $128,000.  We moved back to Portland, OR into a rental prior to closing, giving our Realtor POA to sign our paperwork for us.  Back to the Pacific NW’s mild winters, occasional earthquake and volcanos.

History · Real Estate

House 5…

We sold the Vancouver house by the power towers on 9.30.96 for $102,000 and moved into an apartment while we searched for another home.  Our goal was to avoid feeling pressured to buy a house.  This time we wanted to take our time looking for a new home.

For the record:  The Vancouver house sold for $193,500 on 4.16.08.

We settled on a small (1124 SF) 2-3 bedroom, 1 bath, 1910 fixer in the small river town of Kalama, WA.  The home was located on a 75×100 lot.  The house had been owned by the same family for years.  We bought the house on 12.28.96 for $78,000.  The house was dated and needed a lot of cleaning; however, living in an apartment enabled us to work on the house prior to moving in.

The house had several original (vintage) characteristics inside.  The heat source consisted of an old Coleman wall heater on an interior wall with vents in the ceiling to the upstairs that allowed gravity to take the heat upstairs. Some of the modern conveniences in this house were obviously added after the house was built.  On the plus side, the house had updated electrical!  The house had no garage, but the lot “seemed” large enough to build one on in the future.

We spent one month working on the house nonstop nights and weekends before we moved in.

During the time we owned this house we installed forced air heat, totally renovated the bathroom (including dry rot repair in the flooring), replaced the roof, installed new front and back doors, replaced broken windows, reinforced the ceiling in the living room, replaced all the carpeting, installed new vinyl in the kitchen, dining and bath, painted, new cooktop, added a skylight in the kitchen, cleaned up the landscaping, built a garden shed and grew a garden.

We planned to build a garage until we found out we’d need a survey done prior to getting a permit to build one.  We didn’t want to spend that kind of money.  Rumor had it that Kalama is known for property boundary disputes (something we didn’t know when we bought the house).

Finally the place seemed like home, and then the unthinkable happened in December, 1997, my husband and I both lost our jobs at the same time!  By February, 1998 we were ready to sell and move for work.  We listed our house for sale by owner with courtesy to broker, priced it right and sold it in the first week, to the first buyer, for $92,000.  It should be noted that at that time, homes didn’t sell fast in Kalama.

Next location?  Wisconsin (my home state).

For the record: The Kalama house sold again on 3.24.05 for $130,000.


House #4…

Having given notice to vacate House #3, we quickly started looking for a new home again.  We got a new Realtor, but we couldn’t find a house that met our needs in Portland.  Having exhausted our housing choices, we decided to look at homes on the other side of the Columbia River in Washington.  Vancouver, WA offered homes with lower property taxes and better schools and is considered part of the Portland Metro Area.

We were feeling under pressure and this time around we were looking at newer homes that didn’t need a lot of work!  We finally settled on a 1199 SF, 3 bedroom home that was built in 1993, situated on .28 acres.  This home had an oversized 2 car garage.  The home was located in a small, new development and only needed landscaping.  Best of all, the home was vacant and the sellers were ready to close fast!

The down side of this home was that it had a BPA easement across the back of the property.  We researched the regulations pertaining to a BPA easement and the potential negative effects of living by high emission power towers.  The only place we could get this information was from BPA (this was the pre-Internet era).  Building homes near power towers had been done for years so we decided it couldn’t be that bad.

We made an offer to purchase using my VA home loan and we wanted to close as soon as possible.  It worked to our advantage was that the home vacant and we were pre-approved for our loan; the sellers took our offer.  We bought the house for $87,000 in October, 1993.

Believe it or not, the power towers aren’t as close as they appear in this photo!  In fact, the closest tower was more on the neighbor’s property than ours.

Vancouver House


House #3: To Walk or Not To Walk Away?

If you read about our House #3 experience, you know this house provided us with a wealth of learning opportunities; however, we had reached our limit with the sellers.  We wanted out of the sales contract.  

We contacted our Realtor to let her know we wanted to walk away from the deal.  Our closing date was behind us.  We had become renters and we wanted to be home owners.  The property was tied up in a legal mess due to engineering liens and there still was the issue of the pending plot approval by the county.  With the situation as it was, the house did not qualify for financing because it wasn’t complete and the owners/sellers didn’t seem to be in a hurry to complete the house. Why should they?  We were paying them rent which created positive cash flow for them.  The longer we paid them rent, the more money they made on the house deal which meant the more the house was costing us.  We asked our Realtor to give them 30 days notice that we were vacating the property based on a standard month to month rental agreement.

When the sellers were notified of our decision, they refused to release our earnest money back to us saying we failed to perform.  They said they were willing to sell the house to us and that we were breaking our sales contract.  We said they failed to perform.  We were willing to buy, but the sellers couldn’t provide us with the title to the property by our closing date, plus the house wouldn’t finance in it’s current condition and we allowed the sellers plenty of time to get the house ready to close.  The house was to be purchased with a VA loan. VA requires that the house qualify for financing or the vet is supposed to get their earnest money back. We moved into House #4 the end of May, 1993 (we closed the previous house on June 1, 1993).  We were supposed to close on House #4 in July.  It was now September.  

Regretfully we started packing and looking for House #4.  Now technically we never owned House #3, but due to the extent of our experience, I count it as one of our homes.  After all, we completed a lot of work on this house that the sellers would benefit from after we moved out.  We left a lot of our sweat equity in that house.  We removed from the house what ever we could, making sure we didn’t damage the property.  We left behind several things, including all the mini blinds and a medicine cabinet in the master bath that we paid for and installed.  Jon disassembled the unattached storage shed he built.  We took down the play structure Jon built in the back yard.  We vacated the property by October 28, 1993 and it was in better shape than when we moved in.  It should be noted that the house was still incomplete by our move out date.

The release of our earnest money decision was handed over to Small Claims Court by the Escrow Company because we disagreed on who should get the earnest money.  

When we appeared before the judge, the owner was very angry.  She told the judge we left the house in poor condition and she deserved the earnest money because we damaged the home and we didn’t buy the house.  We said we didn’t buy the house because it was not complete and the sellers could not close on the house as promised due to the still pending plot review with the county; our closing date was long over due. The judge told the seller that if she believed we damaged the home, she should have filed that evidence with the courts prior to our court date.  Since she did not do that, she was not allowed to go after us for damages related to this property now or in the future.  The judge told us next time we buy property we should put a termination date on our sales contract. 

The judge ruled in our favor, we got our earnest money back.  The seller stormed out of the court room.

The sellers re-rented the house after we moved out and eventually sold it in July, 1994 for a little more than what we offered to buy it for.

Side note:  This house sold for $219,900 in 2006.


House #3…our Money Pit:

First let me say that this happened in 1993, so some of the details may have been missed, but the majority of the points are covered.

We made an offer for $76,000 on a house that was remodeled by the owner who we were told was a contractor.   Financing would be a VA Home Loan.  The owners were in the process of dividing the property into 3 lots.  The house was on the first lot.  They were creating 2 flag lots on the back of the property.   The house remodel was not complete, but we were assured it would be complete by the time we were supposed to move in.  Our offer was accepted.  We were told we could move in before we closed (rent from the owners) if need be, because they were waiting for a final plot approval by the city on the property before we could close on the property.  We were told this process was nearly complete.  Everything sounded good to us.  The owners were planning to build new houses behind us.  We thought that would be good for the future value of our home.  Escrow was opened.  We were excited!

  • Lesson #1:  Pay attention to the warning signs. If it sounds too good to be true, it probably is!

We were verbally told the unfinished kitchen cabinets were going to be stained a clear blue-gray (this was not in writing).  One day we went out to the house to see how the cabinets looked after they were stained.  We were disappointed to see the cabinets were painted an opaque white.  We asked our Realtor why we weren’t told of this change since we were buying the house.  We were counseled that we could risk losing the deal if we make an issue of the matter.  Though we thought we were mislead, we didn’t want to risk delaying our purchase so we let it go.

The completion of the remodel work on the house slowed.  We expressed concerns to our Realtor.  She assured us that the owner promised the house would be ready for us and that it would happen.  We were told the owner had other houses he was working on.  Our moving in date was fast approaching and there still were things that were not done. 

  • Lesson #2:  Get a home inspection!

The VA appraisal came in based on the anticipated completion of the house.  Once it was done, a final needed to done before closing.  Some of the list included a furnace inspection, installation of a dryer vent, and the ceiling over the new family room needed to be properly insulated (the house had been disclosed as having new insulation).  Our lender began pushing to get these things done.

  • Lesson #3:  Don’t move into a house before ownership transfers.

We moved in as if we were supposed to be the owners.  I put up window coverings, blinds, wallpaper borders, bathroom mirrors over the sinks, towel bars, etc.  My husband built a play structure in the back yard for our daughters.  We started to fix some things because we didn’t want to wait for the owner to do the work.

The insulation above the family room turned out to be a bunch of styrofoam tossed all over.  My husband said he could install the insulation if the owner paid for the insulation.  The owner fought this request because he said lt the insulation in there (syrofoam) was superior insulation to fiberglass insulation and didn’t need to be replaced.  The owner reluctantly gave into our request because the lender required it. 

After we moved into the house we found all sorts of problems.  The dryer vent was “installed” but not vented to the outside.  It was vented into the crawlspace–moisture to the crawlspace.  The bathroom fans vented to the attic, not to the outside–moisture to the attic.  The owner fought correcting these issues, so my husband fixed both.  One day I was using the bathroom sink and I heard water running in the bathroom that sounded like it was under the heat vent.  I pulled the vent off the floor and there was NO duct work under the house connecting the vent to the furnace!  I was hearing the water in the bathroom sink drain pipe that was located under the vent. 

Remember the furnace inspection required by the VA Appraiser?  We found out the furnace was not completely installed.  The burner needed to be replaced before it would be approved by the gas company.  Now add to the list hooking up the furnace duct work.  The owner fought this.  We won because the gas company required the repair work and the lender the duct work.

Needless to say, we were upset.  We were pushing to get the house done so we could close.  We had done a lot of work on the house already.  We pushed to find out the status of the plot map.  We found out the plot approval was stopped because the owner didn’t pay the engineer that did the plans.  A lien was put against the property and the owner was trying to work a deal with them to release the plot map to get the process going.  This meant the city approval process had NOT really begun!  We were paying them “rent” to live in an incomplete house and our ownership date was moving farther and farther out.

The owner would promise to come out to work on the house.  He would show up for a couple hours and then leave.  It seemed closing the deal wasn’t a priorty to the owner.  Afterall, they were getting rent from us.  Since we were paying them rent, we decided to use tenant-landlord laws to force the owner to do some of the repairs.

  • Lesson #4:  Talk to the neighbors.  Check out the crime rate and look up registered criminals in the neighborhood BEFORE making offer on a house.

We started talking to our new neighbors.  We found out the owner of our house was doing a remodel job for one of our neighbors.  Apparently they saw him working on the house we were in and hired him to do an addition on their house.  We became friends (allies).  The addition on their house was faulty and they wanted to sue the contractor (the owner of the house we were trying to buy).  We compared stories.  When he left our house, he was going over to their house.  There was a pattern of problems.

One of our neighbors that lived in a little rental house next door had frequent, loud, domestic disputes at all hours.  There were always a lot of different people going in and out of the house.  One day I saw their oldest child playing with a large knife outside my window.  I called child services and reported them.  These were my neighbors?  My children’s peers?  I hoped they would move away.

We were beginning to think the deal was not going to happen.  We wondered if we should walk away from the house, take our losses and move on.  Our closing date was now over a month ago with no closing date in sight.  Housing prices were slowly going up.  If we walked away from the deal, we were sure the owners would relist the house for more money.

  • Lesson #5:  Put an escape clause date and time in your sales contract.

Through it all, our Realtor assured us things would work out.  Our breaking point was the day I came home from work to see our fence had been bulldozed and removed!  The owner took the fence to one of their other properties!  We were told we could force him to bring the fence back, but we were tired of fighting with the owner to get the house done.  We had enough.  We wanted out of the deal!!!

 And that is another story for another day… .


House #2…

I left Minnesota in January, 1990 (Happy New Year!) for the Pacific NW.  I landed in a rental and within 6 months I was shopping for another house to buy. 

Portland BungalowMy second house was a 2 bedroom, 1 bath with a detached garage on a 4300 SF lot located in SE Portland, Oregon.  I bought this house for $35,000 with my VA home loan eligibility.  I got in with zero down with a fixed interest rate between 10-11% in July, 1990.

This house was a Portland bungalow, built in 1911.  It had high ceilings, a country kitchen, a small enclosed front porch and a white picket fence.  I didn’t have to do a lot to the inside because the previous owner cleaned and painted it prior to selling it.  It also had a fairly new roof and good gas furnace.  There was a lot of yard work that needed to be done.  The house came with a pile of junk in the back yard and the landscape was old and over grown.  I cleaned up the yard and decorated inside. 

In the fall of 1992 I got married and by the spring of 1993 we were ready for a larger house.  We put my house on the market. It sold within the first week to a guy from Minnesota!  We sold the house for $55,000–full price in June, 1993.  I thought I did pretty good on that house since I didn’t really have to do anything major to the house. 

Side note: This house sold for $207,000 in 2005.

Shopping For House #3…

We made offer on another house in SE Portland and moved in prior to closing because we needed out of the house; we felt a bit under pressure. 

This move proved to be our FIRST Do’s and Don’t Lesson in Real Estate which I will save for my next posting.  For now, lets just say we can personallly relate to the 1986 movie “The Money Pit” Today we own a copy of that movie as a reminder that not all people that fix and sell homes (flip homes) have integrity.