Wednesday, October 31, 2012

One year anniversary of my first marathon

Image courtesy of The Irish Times

Happy Halloween everyone! I hope you're either celebrating in style or staying safe in the aftermath of Hurricane Sandy. Beyond the excitement of trick or treating and pumpkin carving, today is exactly one year since I ran my first marathon in Dublin. I cannot believe it's only been a year; it feels like a lifetime since I pushed myself along for 26.2 miles.

In that year, I have to admit, I really haven't run much at all. The Irishman and I had big plans for keeping up our running and staying in shape but Christmas happened, and then winter hibernation, and then house buying and all of a sudden our Saturday mornings were booked up with life plans rather than long distances. Over the summer I started running to work and then running home every so often – but less often and more not. Moving to our new house a bit farther from my office provided me with a better distance for my runs home from work, more like 4 miles, but I'm still not running home with any great regularity; I hate running with a backpack, I hate having to lock my handbag in my desk, I hate having to plan to bring my gear into work with me. Basically if there's an excuse not to run home, I've made it. And forget running on the weekends: house viewings have morphed into house improvements, and once you've spent about 8 hours painting the last thing you want to do is go out for a run.

I've recognized that I have a sort of mental block on running at the moment – well, for an extended moment – and so I attempted to resume my yoga practice over the summer. I found The Life Centre in Islington and fell in love with Alessandra Pecorella's Tuesday evening class, and really got into it – until we moved. Now a bike ride away instead of a short walk, I again am finding more excuses not to go. I know I need to go; I feel so much better, so much more whole, so much more positive after a class   – yet I CAN'T MAKE MYSELF GO. I do know that I am a goal-oriented person and a contributing factor to this is that I don't have a goal for either yoga or running (besides the nebulous "lose weight"), but I'm also having a hard time setting a goal. Right now my goals are about redecorating and saving up for a new kitchen, not running certain distances or perfecting my headstand practice.

In some ways, my goals have become shared and intertwined with The Irishman. We do so much together that it's sometimes hard to find my own space to pursue my own goals. Previously, us time included running as we trained for the marathon together as a way to spend time with each other. But now we're constantly DIY'ing and cleaning and decorating together to make our home that I think I've sort of forgotten about what drives ME. Moving forward, I need to work on finely tuning that balance of me vs us time and hopefully find a way to get some physical activity into that me part of my life.

But beyond the "I haven't really run a lot in a year", I'm still really proud of myself for running a marathon. It's up there in my most proud moments and even today I pull myself back to the feeling of driving myself over the finish line, or forcing myself to put one foot infront of the other, when I encounter a particularly challenging situation in life or at work. I'll never forget my relief when I made it over the line, and I'll never forget the pride in myself that I felt at that moment. I always imagined that I would cry when I finished but actually, I felt powerful and contented  – like I finally proved something to myself that deep down I always knew but never acknowledged. That's something that I will never ever forget.

Sunday, October 7, 2012

House Week Part 6: The Fine Print

To wrap up House Week, the last piece of the puzzle to put in place is how we made the house ours. As I said yesterday, we saw the house in late April and it piqued our interest. We saw it on a rainy day and it felt so cozy, and unlike anything we'd seen before, that it really stuck with us. So we scheduled a second viewing for the next week to see it again and decide whether or not it was something we were serious about. After that second viewing, we called the estate agent and made our initial offer.

The offer was of course rejected, and we decided to take a different tack than our previous property negotiations; we basically decided what our highest offer would be and just went in with that. If the seller ended up wanting more, we would walk away. The agent took our offer to the seller and she accepted it, but with the condition that she was waiting to hear on an offer of a property she wanted in Wales. If she didn't get the property, she might not sell the house at all. We went into the first Bank Holiday weekend on tenterhooks, waiting for a call letting us know whether there would be a deal – or not.

The Irishman got a call the next Tuesday from the estate agent, and it turned out that the seller didn't get that particular house in Wales... but she wanted to go through with the sale! We were ecstatic, but had been burned before, so we just quickly went into business mode to lock down the purchase. We called our lawyer, got him in touch with the seller's lawyer, and started talking about the possible dates for exchanging the sale contract and completing the sale, and we spoke to our mortgage broker about getting the load finalised. The seller was moving to Wales for personal reasons, and needed to be in a new home fairly soon, so she wanted to hurry the purchase along as quickly as she could. We were happy with that, but knew nothing would be final until the exchange of contracts; exchange, as it's called, is the moment the sale becomes legally binding – until that point, either party could pull out of the sale with no financial penalty. Luckily for us, the seller wanted the house listing pulled from the estate agent's offices and websites so that any sellers of homes in Wales couldn't track her sale and find out how much money she would be getting. This was good for us because it meant there was little chance of us being gazumped - that is, somebody else coming along and offering more for the house and pulling it out from under us.

The next steps for us consisted of a lot of waiting. The lawyer proceeded to conduct a document search on the property with Hackney council; this is to make sure there aren't any series legal issues with the house itself (liens against it, all works were conducted safely, etc). These searches tend to take around 2 weeks, but unfortunately for us Hackney's computerized system went down over Christmas 2011 and probably STILL hasn't been fixed. They advised us there would be delays as the searches had to be performed manually and there was a significant backlog.

Meanwhile our mortgage broker came back to us with good and bad news: the good news was that there were several good deals going on mortgages, fixing low interest rates for up to 5 years even for buyers putting down low deposits. We wanted to go with a fixed rate for stability. Even though mortgages are really cheap on tracker loans that follow the Bank of England base rate, we wanted to know exactly what our monthly outgoings were going to be for a set period of time. As we were putting down a 15% deposit and will need to repay our respective parents for the loans, we wanted to be sure that we could afford to do both in the event of a dramatic interest rate rise should the economy pick up.

The bad news our mortgage broker had for us was that we probably weren't eligible for any of those deals given my non-resident status. When we first started working with this broker, he was confident that given my length of stay in the UK, my job, my salary, etc, we wouldn't have a problem being accepted for a mortgage. We easily got an AIP for a hefty sum early on in the process with Halifax, which is considered a good lender and made us look like excellent prospects as buyers to estate agents. However when it came to shopping around for the best deal on mortgages, I was considered a risk or "an exception" for many banks and lenders. Our broker was good at knowing which banks we couldn't approach at all (Santander) and which ones he might be able to sneak us through using his connections (Northern Rock). But at the end of the day, because of the lack of lending in the market overall and the volume of mortgage applications being submitted for good deals, most banks were not reviewing exceptions and we weren't able to take advantage of the deals. We ended up getting our mortgage with Halifax, which is apparently the only bank who will lend to non-permanent residents, with an interest rate at least 1.5% more than the next option.

I wasn't pleased, to be honest, because I felt like my expat status was again costing me more to do normal life things. The Irishman genuinely rued that he hadn't asked me to marry him sooner so that we could save money on our mortgage (romantic), because all the bank wanted was a piece of paper I am 6 months away from obtaining. We actually located a specialist Tier 1 immigrant mortgage broker for a second opinion, and he kindly reviewed our offer and basically said to go with it as he couldn't get us anything better. At this point, we were under quite a lot of pressure to finalise the mortgage because the mortgage company needs to perform a survey of the house before the loan is agreed and the seller hadn't had the surveyor come through yet. Her lawyer started chasing us up, worried that the sale wouldn't go through, and we had to fast-track the mortgage process to reassure her we were committed.

Once the loan went through, we basically spent the summer waiting. We didn't hear from Hackney council on the searches until the end of July and when we did we got bad news: there were concerns over the legality of some of the building works that had been done to the house (things that were the reasons we were buying the house). So again, we had to again while the seller and her lawyer investigated the issues. It wasn't 100% resolved for us, but the seller took out an insurance policy for us that protects us against the loss of value of the property if something were to go wrong. Our lawyer advised us that was good enough, and we moved forward with the sale.

Because of the seller's timeframes in trying to move into a new place quickly in Wales, we had to fast forward the sale process bigtime after all of the delays during May, June, and July. We exchanged contracts around the first of August, and completed on the 10th. Usually people exchange contracts and have a longish wait to move into their home; we had 10 days to pack up and move! We also only had 10 days to transfer funds globally. Because we weren't sure whether the sale would go forward, I didn't move money from the US until we were locked into the sale. I had money in mutual funds and an IRA, the latter of which I will have to pay a tax penalty on for emptying before a certain age, and I didn't want to incur those penalities unnecessarily. So I liquidated those accounts and then had to figure out the quickest and least expensive way to get the funds from the US to the UK. I ended up writing my dad a check for the money, and he had Bank of America wire all of the funds to me in the UK – there was a $25 charge, I think, and it arrived in 3 days. I also had to go to the bank I had an ISA with in the UK to transfer the balance; the sum was too big to do online or over the phone.

At this point, all of the money becomes funny money; the number of zeros is laughable and the value is more as quantities on a spreadsheet rather than actual money you own. It's a weird feeling. Especially because the money is just going going going every which way. Here's a short list of the funds you need to proved on the day you complete the sale:

  • Down payment (15% of total agreed house price)
  • Stamp duty (3% of total agreed house price – this is in addition to the price of the house)
  • Mortgage fee (the price you pay for the privilege of getting a mortgage, around £1000)
  • Lawyer's fees
Like I said, funny money Рyou get rather blas̩ about the whole thing after a while, probably as a coping mechanism for dealing with the sheer amount of money you're spending in one fell swoop.

The day we completed the sale, I thought I would be giddy and feel some sort of amazing relief. But I had a rather busy day at work and The Irishman cycled to the estate agent's office to get the keys alone. I met him after work and we immediately went to IKEA to buy a bed for our guest room, as we needed something to sleep on for the first few weeks until our new bed arrived. I had dreams of doing the whole "Chinese takeout sitting on boxes with cheap champagne" romantic new homeowner moment, but we didn't have time! We had to finish packing so we could move into our new home the very next morning.

So there you have it! That's how we bought our home. Friends of mine in the US tell me this process is so different from how it's done in America but I have nothing to compare this experience with. Obviously I learned a lot about the UK property market and house buying process, so if you have any questions please feel free to post them in the comments or email me personally.

Saturday, October 6, 2012

House Week Part 5: finding our place

Apologies to everyone for not posting this yesterday; I typically find my time to blog right before lunch at work and yesterday it just didn't happen. So without further ado, let's jump straight into how we got this here house I'm sitting in right now.

I mentioned on Thursday that towards the end of March The Irishman and I were getting rather fed up with the whole house search process. I had been hearing ridiculous stories from people at work about searches that went on for years, people finding a street they loved and stalking it, waiting for a home to come up for sale, and even flyering the street asking if anyone was considering selling so they could buy exactly the right house exactly where they wanted. The Irishman and I were horrified at the thought of continuing to look for a place for years, let alone months; we'd only been at it for 3 months and it already felt like a lifetime.

In mid-April we went to the US for a bit – me for 10 days, to see my family, and then to Florida for a wedding where The Irishman met me – and we chilled out. A lot. While we were away, the second granny house fell through and we both sort of just, I don't know, gained perspective I guess. We had been making this such a big thing, pinning all of our happiness and future plans on this ephemeral perfect house, and being amongst my friends celebrating a marriage made us realize that we were probably just making it a lot harder than it needed to be. We also realized that we were approaching the search from a "forever house" perspective; this is a term you hear quite a lot in the UK, which is sort of interchangeable with "family house," but essentially means the house you plan to spend most of your life in, raise your kids in, and really commit to. Our house was going to be the beginning – for a while, sure, but not forever – and thus it didn't need to have EVERYTHING. This was a biggie for me, this epiphany, and it helped me reconcile a lot of the issues I was having with finding exactly what I wanted in our price range... because it didn't have to have it all. It just had to have enough for both of us to be happy.

So we returned to the UK and made a bunch more appointments for viewings, intent on not letting the search take over our lives. The very next weekend, we saw what is now our house. The Irishman remarked to me as we walked up to the place that he was surprised I wanted to see this place; he had seen the listing and didn't think it was something I would be interested in, but I was intrigued and we had made a booking anyway. Afterwards when I was describing the house to a friend, she said I talked about it in a very different way to all of the other houses. She didn't say why, but she said this one sounded different. This all sounds a bit like dating, no?

And actually, it is exactly like that. You think you want something very specific in a partner and then you meet someone who makes you realize that actually, you don't need some of those things to be happy. So with this house, I didn't get a lot of things I wanted but I love it just the same.

To begin with, it's a modern build house. You might remember that on Wednesday I said that I didn't want a modern build, but I think I didn't want a house that felt overtly modern; I didn't want a house where everything was slick and soulless. This house was built as part of a mews development in the 1980s, and it looks like a cottage. It is set down a dead-end lane off of a main road, in between Church Street in Stoke Newington and Dalston Kingsland Overground station. The lane has a gate at the end, and when the gate is closed you feel like you're in another world, not in the middle of busy Hackney.

There is a garden, more like a patio, that is south facing and is a suntrap for most of the day. The kitchen is pretty old, and it separate from the rest of the ground floor so it will be the first thing we renovate (more on that very soon). The master bedroom is huge, and has a big closet (as does the spare bedroom). There is a huge walk in closet off the hallway which I would love to use as a small laundry room if possible. The bathroom is okay, not great, but will suffice until we get around to redo-ing it.

The main attraction of this specific house is that it has a converted loft, so we have 2 full bedrooms plus another room that can be whatever we like. Initial plans are to make it a hangout room for The Irishman, where he can watch sports unimpeded, and also where I can have my sewing machine and art stuff. But maybe it could be expanded further to make it the master bedroom, with an ensuite bathroom. The possibilities are endless, really.

And I think that's in the end what sold us on the house – the fact that there weren't limitations to it, rather tons of things we could do to it. Instead of having to worry about the roof, or updating the electrics, we can go straight into cosmetic improvements like putting in a new open-plan kitchen. The house was constructed in such a way that all of the load-bearing walls are on the perimeters, so any of the rooms can be reconfigured fairly easily. We don't need to get planning permission for most upgrades, as it's not listed, and The Irishman is confident he can do most of the DIY work himself to save money. With a period property, we wouldn't have been able to do too much ourselves as we would have had to consider the codes and restoration before even thinking about wallcolors.

What didn't I get? A fireplace, to start. Lovely plasterwork cornices and ceiling details. Original internal shutters in windows. The joy of having a piece of history. But as I said, these are things I can live without. Instead, I got something that we are already, 2 months in, making our own, making work for us and how we want to live where we want to live. And that in itself is priceless.

So I've just reread this and realized that I told you all about our place but not how it ended up becoming ours. I'll need to give you that in part 6 tomorrow. Stay tuned!

Thursday, October 4, 2012

House Week Part 4: Offers and Decisions

After reading yesterday's post, if you thought that finding houses to see was bad, imagine what it was like trying to decide which one you liked enough to buy! Buying a house isn't as easy as simply walking in to Macy's or M&S, trying on a pair of shoes, deciding whether they fit, go with your outfit, and are good value, and simply taking them to the register to pay. Each property we saw was unique, and we went through a complex set of negotiations and emotions individually and separately to come to a decision about whether to make an offer on a specific one.

The process is something like this:
  • See a property – viewings tend to be around 15-20 minutes, shorter if you hate it, longer if you love it
  • Decide whether you like it enough to see it again
  • Schedule a second viewing
  • Make an offer
  • Negotiate
  • Either your offer is accepted or rejected
But the process is rarely that straightforward. Sometimes an estate agent shows you around. Sometimes the owner shows you around. Sometimes you see something in pictures that you love and when you walk inside you hate it. Little things about a place can colour your opinion; I remember this one maisonette had this tiny little bathroom off a stairway landing, and I refused to consider buying it because of that one particular feature. Sometimes you'll go away to think about the house and call the estate agent back and find out it's already gone, just hours after you saw it. Sometimes you'll see something and it will make you reconsider what you thought you wanted. The whole thing is so subjective that you really have no idea what you want until you see it.

The Irishman and I made offers on 3 houses before we ended up in the one we eventually bought. Two of them were what I called "granny" houses; these are period houses that have been lived in by families for the past 4-5 decades and haven't been updated since about 1965. The generation of my grandmother is still living in their homes, often widowed, and can no longer keep up the house. The upside of these treasure troves is that you can get them quite cheaply compared to properties that have been recently redone as buyers would go into them, have a look at the horrid wallpaper, and think "I don't want to do this job." We wanted to do that job, so we hoped to find an amazing home at a fraction of the price. The downside of these homes is that often there was a decade or so of neglect, and you got what you paid for; roofs, floors, even whole electric wiring systems had to be replaced in both houses we made offers on before we could even move into them.

We lost both of those houses, one because someone offered £35,000 more than we did and the other because even though we offered more than the other party they were a cash buyer – nothing trumps a first-time buyer besides a cash buyer. In both cases, in retrospect we were glad that we didn't end up with those homes. The sheer amount of money we would have had to pour into them to renovate them up to a liveable standard – just liveable, not even to a specific design aesthetic – would have exhausted all of our resources for the foreseeable future. We both borrowed funds from our respective parents for our downpayment (more on that tomorrow) and it's already looking tight to pay that back; had we gotten either granny house, we wouldn't have seen either of those parents for quite a few years we'd be so cash strapped.

The third property we offered on was a ground floor maisonette that featured a 70' south-facing back garden. When you start shopping for a house, you start to learn things like south-facing gardens are the best because they get light all day and into the evening; west-facing is a close second but doesn't have the morning sun, and north-facing gardens are the worst. So this lovely garden was full of grass and flower beds and even had a shed in the back! The rooms were a good size and the kitchen opened into a lovely sitting room with a great big fireplace. The downstairs bedrooms were just okay; I felt like I would have wanted to knock down all of the walls and redo them because they were all odd sizes. The third bedroom wasn't even really a bedroom, more of a study, but would have been okay for sewing. We made on offer on that house that was initially accepted but then the estate agent called back ten minutes later to say someone else had offered more so they were going into a closed bid: highest price won the house. Despited being convinced the jerk estate agent actually called another interested party to tell them the house was going at a certain price, we quickly scheduled a second viewing to decide how high we were going to go with our bid. On closer inspection we decided that actually we really didn't like the house that much, and it wasn't worth more than the prices that had been rejected. We decided not to bid on it, and let it go.

At one point around the end of March / early April, we got pretty down about the whole process. We'd lost out at two homes by now and were bickering over the houses we were seeing. I was ready to jump at anything, and could see potential of homes slightly out of our geographic area that needed quite a bit of work. The Irishman was leaning more towards smaller places in the heart of Stokey, and I was getting upset at him rejecting properties with seeming no rhyme or reason. After a few particularly gnarly fights, I was lamenting about the process to a friend of mine at work who shared her story of how she and her partner found their home. She said they put together an evaluation sheet that helped them both independently and objectively evaluate whether the house was someplace we really wanted to live in and make our own. I mulled on this and created the following form for us to fill out based on our core criteria and a few other mandatories that had emerged throughout the search:
Using this checklist really helped us turn a corner in the search, because all of a sudden it wasn't him vs me, or me vs him, but an actual score we could discuss. It turned out that some things I originally thought were really important actually weren't in the grand scheme of things, and it helped The Irishman see what I valued the most. For all of the properties we used the checklist with, we were never more than 5 points apart. We just needed the vehicle to help us talk about the houses rationally.

I've left the best for last – the house we bought and now live in! I'll tell you about it tomorrow, along with the wretched process of actually finalizing the sale. 

Wednesday, October 3, 2012

House Week Part 3: Dealing with estate agents, or the worst people I've ever met in my entire life but who have the power to make or break your spirit

This clip says it all. The stereotypes are true. Estate agents are wankers.

Once we decided on Stoke Newington as our prime neighborhood to focus on in our property search, and agreed our criteria for the property itself, we started to actually look for a house. Instrumental in our search was RightMove, which has handy filters and updates constantly. Once we set our price range, bedroom numbers, and location, we constantly trolled through the listings to see what was out there.

The bad news was, not much. The credit crunch stalled the rise in house prices across the UK and while London properties maintained most of their value, home owners realized they wouldn't make the big gains by selling earlier in the year and instead starting investing in their properties rather than upgrading. So we would go for weeks when only 1-2 new properties would appear for sale each week and the rest of the listings were old news. That was a pretty depressing time, as it felt like we'd never even see anything we liked that we could afford.

We also registered with estate agents representing properties in Stoke Newington to get on their radars. This consisted of us walking down Church Street, looking in the windows of all of the estate agent offices at the properties they claimed to have on the market, and going in for a chat. We would sit in each estate agent's office and tell them our price range, criteria, what type of property we wanted (period property! no new builds! please God NO EX-COUNCIL PROPERTIES!!!) and outline our own situation; being first time buyers with a decent deposit and rolling month-to-month rental contract made us attractive as buyers as we were flexible. We learned that being chain-free (ie, not having a house to sell to release funds to buy our next property) was a really helpful trump card – I actually came to protect that status, not wanting to waste the opportunity. We would always get a great spiel from the estate agent about how we would find something we would love, how they had so many properties for us, and how everything would just be great.

We kept that optimism as we started going to viewings. Those first viewings tended to be lovely period properties converted to maisonettes – a two-story flat that is either the top or bottom half or a house. As we wanted a garden, we would see bottom floor maisonettes where you entered on the ground floor to the living areas and kitchen and then go downstairs to the bedrooms. What really shocked me about these properties was that they were listed at pretty high prices, not much difference in price to full houses, and often had weird conversion elements that made me think "why did they decide to do THAT?!". I often felt, looking at those maisonette flats, that I would be paying a lot to fix someone else's mistakes.

The other shocker about these properties was that because of the overall lack of properties coming onto the market, everything was in high demand. We were introduced to the "open house" fairly early, when we would be booked in to view a property at 2pm or whatever and show up to find at least 3 other couples milling around the place. It was disheartening as my competitive nature kicked in and we could tell the other couples were sizing us up as foes. It was also pretty depressing because 99% of the time, the other couples were either pregnant OR already had at least one kid. Too many times we walked up to see a property and tripped over a line of strollers parked outside. How can you compete with a bunch of couples who clearly need extra bedrooms for their children when you just want extra rooms for hosting guests and a sewing machine?

After seeing a few of these maisonettes, we saw our first full house and promptly fell in love. I blogged about it here, and the experience of seeing a proper 2 bed house fully intact made me realize that I just couldn't compromise on the idea of a HOUSE. So when estate agents would call with a maisonette or a flat, we would really grill them on what it was like; there's no point in seeing something that wasn't within our core criteria. I can't even tell you how many times I would get a call saying "Hey, we've got something we KNOW you'll love, you HAVE to see it!" and within a few minutes I'd find out that it was actually only a one-bed, didn't have a garden, wasn't in the area we were looking. Even worse, we would go and see properties and the estate agent would say that actually the price hadn't been set yet and so we'd see it, like it, and find out it was about £50-75,000 over what we could afford.

The worst estate agent move we experienced, though, was at the hands of Location Location. I'm publicly shaming them because we know they employed dirty tactics and eventually I refused to see houses they represented because of their horrendous service. We saw the first full house with them and they held our offer back from the owner in the hopes that someone would offer more, and when they did pass the offer on to the owners we're sure they counselled the owners not to accept it. But they also used us in the opposite way, by calling me to tell me they had this GREAT property I HAD to see, but someone was interested in it and about to make an offer so I should see it RIGHT AWAY so I wouldn't be disappointed. But it didn't have a garden, didn't have a full second bedroom, and I realized that the estate agent just wanted me to go in and make an offer to inflate the price for the other poor buyer! When I turned down a viewing of another property they called me about, the estate agent actually lectured me about how property prices in Stoke Newington were rising, that I probably couldn't afford what I wanted, and I was "going to have to start compromising at some point." Her behavior was so rude that I just started avoiding her calls.

So I guess the bottom line is, we ended up having to be really proactive. Good stuff was going fast – if you saw something Saturday that you liked, you had to book in a second viewing Monday morning or risk the property going under offer that afternoon and missing out. Crap stuff was lingering on the market and the phone calls we would get were flogging stuff we'd seen on RightMove for weeks. Often times, we'd call estate agents asking to see properties they themselves hadn't actually seen because they literally would have been put up on Rightmove moments ago. It was pretty cutthroat, and oftentimes disheartening. On the flipside, we had so many estate agents cancel viewings a half-hour before the appointment, or not show up, that it was hard to not just throw up our hands in disgust and just stay on in our tiny little rental flat.

But eventually, we did find diamonds amongst the rough. Tomorrow, I'll tell you about how it came down to negotiating the offer stage – both for ourselves, how we decided to make an offer, and how the actual process of making an offer went down.

Tuesday, October 2, 2012

Houseweek Part 2: deciding on a neighborhood

Image courtesy of Londonist

So the thing about buying a house is that it starts out really exciting and full of possibilities, runs through stress and anxiety before ending in desperation. That's the dirty secret no one tells you about. But before we go through the full cycle of emotions, let's start at the sunny beginning and the search – specifically for a neighborhood.

Once we met with the mortgage broker and had an idea of the gargantuan loan we would easily be able to obtain, we started to frame our priorities for our home search. It's an important distinction to talk about homes instead of houses, because we very quickly learned that properties ticking all of the boxes simply weren't "right" for us for reasons that weren't easily explained. Creating a criteria of absolutes helped framed conversation and debate about properties we viewed, but still allowed for personal preference and gut feel to live side-by-side.

Our initial criteria was:
  • at least 2 bedrooms, ideally 2.5 (at this point The Irishman was working from home, and we wanted him to have an office separate from a spare bedroom)
  • garden with decent sun
  • open plan living/dining area
  • decent closet space
  • 1.5-2 bathrooms
  • room for improvement, i.e., not a recently renovated place so that we could do some DIY and customise the place
  • ideally a full house
With that list in hand, we started looking at property listings online in our then-current neighborhood. It quickly became apparent that we weren't going to be able to afford much more than a 1 or 2 bed flat in N1, and to be honest we weren't surprised or upset. For a few months we had started lamenting the crowds on Upper Street, the amount of street noise and rowdy Friday/Saturday night crowds, and the over-gentrification of the area. At some point, when there are 5 burrito joints within a quarter mile, you start to realise that a neighborhood is headed down a path that doesn't sync with your own. So we started investigating neighborhoods boarding Angel. We were relatively open about the neighborhood itself, but The Irishman had two non-negotiables: decent transport links (at least a few night buses and one train station) and safety (so if he was away and I was walking home late at night, he wouldn't worry).

I think this is a really interesting point: we started from the idea of what we wanted our house to feel like, rather than the neighborhood where we wanted to live. If we had started in the reverse, I think we would have compromised a lot in terms of what we wanted from the property itself and probably wouldn't be as happy.

We investigated quite a lot of areas, included Kings Cross, Holloway Road/Camden, Highbury, Hackney, and even Walthamstow out east, but we settled fairly quickly on Stoke Newington. As someone who works in the design industry, most of my colleagues live in the Dalston area and we find ourselves out there a lot for parties and nights out. I personally had spent a lot of time mooching about on Church Street visiting tea rooms and shops, so I felt quite at home in the village. During our marathon training, we both had used Clissold Park for making up mileage on our longer mid-week runs. The Overground trains had recently started service and while there isn't a stop in Stoke Newington proper, the walk to Dalston Kingsland and Dalston Junction stations were manageable, plus there are tons of bus routes in and out of the village. Basically the area felt like the next steps from our lives in Islington to the lives we were hoping to lead.

Once we decided that area was the focus, we started our search in earnest and began calling the dreaded estate agents who would decide our housing destiny. That sounds melodramatic, but is actually pretty bang-on. We'll talk about them tomorrow.

Monday, October 1, 2012

Kicking off house week: setting a budget

A long long time ago, I promised you guys a series on what it was like to buy property in the UK. But then life and that house happened, and here we are nearly 2 months into living in said house and all I've told you about is painting and DIY. As you can see above, I'm at it again with used bedside tables we picked up over the weekend that I'm painting grey.

But today's post is not about DIY; it's the first in a five part series I'm going to be writing this week about the steps we went through to buy our house in London. I'm going to keep it topline and factual, but obviously go into the details of how the experience felt in emotional terms. It was a wild ride, and I think I needed a few months of perspective to be able to write these posts objectively. 

So without further ado, let's chat about the real driver of a house purchase: money. When The Irishman and I set out at the beginning of the year to buy a house, it wasn't a spur of the moment thing. We had been talking for at least a year about finding a place to buy together so that we could create the home we wanted. Our previous place was a one bed flat that was probably better suited to a single person rather than a couple, and we dreamed of each having space as individuals to pursue hobbies and interests. Buying always felt just that little bit out of reach, though, with newspapers and financial journalists reporting that stricter lending criteria meant that first time buyers had to put down at least 30% deposits. It felt impossible, to be honest.

But somewhere around the first of the year, something snapped. I don't really remember what it was, maybe frustration at living in a cramped space, maybe frustration at not having equity and throwing away money in rent, maybe a sign that 10% mortgages were returning... at any rate, The Irishman and I sat down and reviewed our respective savings and realized that we were both sitting on more money than we thought. We each had approximately the same amount of individual savings, which amounted to a possible 10% deposit on a property. So we made an appointment with an independent mortgage broker recommended by a colleague to discuss our options.

If anyone in the UK is thinking about buying a property, my first piece of advice is to find yourself an independent mortgage broker. Ours was so helpful on so many levels in terms of helping us understand what we actually could afford. He recommended we stretch as far as possible in terms of buying the first property, as it makes us more financially independent moving forward with regards to recouping the initial outlay of stamp duty as well as just putting us that farther up on the property ladder. He also advised on calling in any possible loans from parents, bequests, gifts, etc, so that we could put as much in the down payment rather than paying off additional interest. He gave us handy spreadsheets that helped us understand things like actual monthly mortgage payments, interest vs capital repayments, and how the mortgage rates actually work. Most importantly, he gave us a sense of which banks would lend to us given that I'm a foreign national. More on that later.

So after one meeting with him we had an idea of what price range we could afford, and that made our property search come into crystal clear focus – all of a sudden, things became real in terms of price ranges, locations, numbers of rooms, and other features. At that point, we felt ready to actually start looking at properties and had the confidence that if we saw one we liked we could actually do something about maybe buying it. That in itself was the most amazing and exhilarating feeling – we were empowered as home buyers, not just property stalkers.

Tomorrow, I'll tell you all about how we approached our search and the ups and downs of navigating the world of estate agents and property open houses.