We finally did it. And no, not the house in the picture – though it looks amazing. We finally had an offer accepted. We officially started house-shopping two months ago. We’d made 3 previous offers. The first house we offered on we offered $50K below the highest offer. On the second house we were $18K below the highest offer and on the 3rd house we were $29K below the highest offer. Each of these houses had 6-7 offers. And for context, on the 3rd house, we offered $75k over-asking – in case anyone thinks maybe we were too cheap. The housing market is insane right now.

But, I am SO grateful our first 3 offers were rejected because we fell completely in love with our new house. We are obsessed with it and it was everything we were looking for.

Buying this house is a completely emotional decision, and we are okay with that. What I mean by that, is that financially, depending on market appreciation, we’d probably be better off to rent and invest our savings. We also could have purchased something significantly cheaper, and we almost did. For a brief moment we considered a brand new town home that would have cost nearly $200,000 less than the house we purchased. It was perfectly nice, had room to work from home, but didn’t have the outdoor space we badly wanted. We are so so excited about this home. We are excited to have a dog, to host friends and family, to work in our yard and to make home improvements. We are excited to not be wondering each month if we’ll receive a notice to end tenancy. We’re excited to live in something that feels permanent. And the husband is excited to watch tv as loudly as he wants.

As our Net Worth posts show, we’ve had quite a bit of cash sitting around for a while now as we thought we would need it for the down payment. However things changed and we will only be using a small portion of it towards the down payment and a small portion towards the land transfer tax.

We are putting 20% down but almost the entirety of the 20% is being pulled from equity in our rental condo. Why are we doing this?
Because the mortgage interest on the rental condo is tax deductible. The interest on our principal residence is not. Why aren’t we using our cash as well, and putting more $$ down? Because interest rates are so so low right now (the interest rate on our mortgage for the first 5 years will be 1.79%) that it doesn’t make any sense to put more cash into the home. We would rather invest the cash in index funds and hope for a return rate greater than 1.79% – which is very likely. And to be honest, we’re going to need some of that cash to make some improvements to the house.

You can expect a whole lot of home ownership related posts in the future as I plan to track every penny related to home ownership. I have no doubt it’s going to be horribly expensive and I’ll be constantly surprised by costs I wasn’t expecting in the first year. Thankfully we have a good savings rate so we’ll be able to manage but it’ll be interesting to see the effect on our net worth as well.