Real Property St Pete

Rachel Nohlgren: The Homebuying Experience

• David Vann & Julie Jones

Share episode

Send us a text

Rachel Nohlgren, Financial Planner with Mustard Seed Advisors at Raymond James, joins David and Julie to share her experience in purchasing a home with David and The Vann Team.  

Informative discussion about the process of buying and navigation of the market, inspections and the transaction.  

  • Buying a Home to last for 10 or More Years
  • Empowering a Single Parent 1st Time Buyer
  • How a Financial Planner might set a home purchasing budget
  • Understanding Value as a Buyer in an unusual market
  • Fun Times on the Home Search Trail
  • Surprising Reason Rachel Picked this home
  • Full Price Offer ?!?!
  • Inspection Mystery: a new language interpreted
  • Fixing the Plumbing
  • What's a 4-Point Inspection

Want to work with us? David Vann can be found here, and Julie Jones can be found here! Reach out! We're nice, and we'd love to hear from you!

SPEAKER_00:

Like maybe if somebody wanted to buy a farm and move out of town, that would be something they'd want to add to the house.

SPEAKER_03:

That's exactly right. That sounds a little personal.

SPEAKER_00:

That's right. That's right. That's a good fun thing that we talk about in my house. This is David Vann with RE-MAX Metro.

SPEAKER_02:

And this is Julie Jones with Smith& Associates Real Estate with Real Property St. Pete Podcast.

UNKNOWN:

Music

SPEAKER_00:

So speaking of houses, you are going to be a new owner of a home in the next month.

SPEAKER_03:

That is true.

SPEAKER_00:

So I had some thoughts. I wondered if there were any questions that you had when we started into the process of purchasing a house. I know you've listened to our podcast. That can be educational. And then we got together and we started looking at some homes. That's the fun part. And then we discussed the areas that we were looking at because we have kind of our own little house of value that we work with. And location and land are some of the first things that we have to look at. And we all know the St. Pete area. You do too. You grew up here. But you had different stages of life and different parts of what you're doing. You want a different house and a different location. And so we isolated the neighborhood. We talked about the price points. Was there anything when we started in the process that you thought, gosh, I really don't know how this is going to work? And wow, where are the mysteries? What's the hidden part of buying a house?

SPEAKER_03:

Definitely. This is not something I'm an expert in, and I'm a firm believer in surrounding yourself with experts when you're embarking on something so new. I'll be vulnerable with listeners to share that this is the first home at 43 years old that I am buying on my own, on my own terms. It's very empowering. And as expected, the very moment the process started, I just had so many questions for you, David, and for my loan officer. Because once you start getting into the weeds, and especially when it's emotional because it's your own, you want to really make sure that you're seeing things clearly and rationally.

SPEAKER_00:

And sometimes you have to have a good realtor who points out, here's one of the problems with this house. I'm always hesitant to be really negative or critical about houses, but I want you to see the things that are wrong with the house more than I want you to see the things that are right about the house.

SPEAKER_03:

Absolutely. You're pointing out things that might be a risk or as my son Declan gets older, you were really helpful at pointing out. I don't know if teenage Declan is this layout going to work or is this really going to be the right fit for the two of you.

SPEAKER_00:

Separate living spaces, separate, I mean, not separate, just having two living spaces. If he wanted to have friends over and then you wanted to have friends over, there'd be two spaces and one might be with a television, one might be with a piano and obviously bathroom, bedroom, private areas, having those things split around the house. If there was a mother-in-law, then you would have maybe a three-way split. There would be a place for the mother-in-law and then there would be the primary suite and then there would be a kid suite. So those three different things are things you don't think about when kids are 10 and 12, but when they're 14 and 15 and 16, unless you want to move, you should make a plan for that.

SPEAKER_03:

Absolutely. The first step in my process was something that people would usually go to their financial planner for. So I felt like I had that piece, which was what's my purchase range and what What do I have that's going to fund my down payment? I'm bringing this up because I tend to be a little more conservative on purchase price than maybe even other financial planners. I think people should not overbuy in terms of their monthly cash flow. And the financial planning rule of thumb is typically 30% of your income. The typical financial planning rule of thumb is is not to end up in a housing situation where you're spending more than 30% of your net income on housing costs. And that's the all-in cost. So in Florida, things like flood insurance are really key to that equation. As I worked on my numbers so that I could come to you and say, here's the range to go along with the neighborhoods, I realized that my down payment was partially in stocks. And this would have been pretty close to the turn of this year. Economists were starting to predict volatility. So I decided to sell, to sell some stock and just cash is king when there's uncertainty. That's true for housing. If you've got a home improvement coming up or you're buying a house and you're going to need an immediate fix for that house for it to be livable, cash is truly king during this time. So those were my first two steps on the financial front. Once I crossed the threshold to, okay, let's look, I felt like I was now the fish out of water, needing a lot of help, having a lot of questions. And there were certainly so many things I didn't think about. You've already mentioned the split plan, but I remember the first Saturday we went out looking, you educated me about roof structure and how that ties to things like wind mitigation, insurance.

SPEAKER_00:

Yeah. There's a lot of stuff to learn that people don't understand.

SPEAKER_02:

Thank you so much. careful consideration. Yeah, for sure.

SPEAKER_00:

And when you have a price point, you have an idea of what you'd like to spend. I really like for people to look below that and above that, probably, you know, by$150,000 at least on each end. And then to be able to go and see those houses and say, okay, well, this is a really good deal at, you know, 600, but boy, it really doesn't look that good. Yeah. You were originally looking in the$700,000 range, and we found something for$595,000 that had been reduced. Can you share what happened there?

SPEAKER_03:

Absolutely. So that is the number I came to you with,$700,000. This is what I can do. I gave you some leeway, plus or minus, not knowing that your natural tendency would be to come back and say, well, I'm going to build you a list of$600,000 to$900,000 based on this price point, which was... as it turned out, probably a perfect range for me to be looking in.

SPEAKER_00:

You need to look at both. If you're going to understand what you get in the different price was, and then you'll go in some and you'll be like, this is way overpriced because you've seen some in the 800 range. And then you see something else that's in the 800 range. You're like, they're never going to sell at this rate and at this price. So, so I think once you start to see that, you start to get a feel and, And then what happened?

SPEAKER_03:

Yeah, exactly. I think we spent three Saturdays, maybe saw 10 properties before finding the one I put a contract on. And that is exactly what came alive for me. We would see a$750,000 property that needed a lot of work. Or some work. Actually, we didn't see anything that needed a ton of work. But in my mind, as a single mom, any project is a lot of work. So this is all subjective, right?

SPEAKER_00:

Right. And in the neighborhood, there was a lot of income properties. I mean, we saw some properties that had a lot of boots in them. It was really something. There was only one path to walk through this house because there was so many clothing.

SPEAKER_03:

It's so true. It looked so charming on the outside, the bungalow in Kenwood. And we got there and realized, well, David had already warned me. This is truly a 2-1 because there's a separate property out back where you could rent out a space or turn it into your office, which having an office separate from the house is was appealing. It was like, well, let me consider this. When we got there, the realtor first out the gate was like, is this the home you're going to live in? Or are you going to buy this as an investment property? Well, this is the house I'm going to live in. And then as we went through, yeah, the tenant there had used all the spaces for some form of fashion. And I love fashion. I'm a dancer, so I love like costume fashion. I kept getting distracted, like majorly distracted. And David said something like, I think you want to be this person's friend.

SPEAKER_00:

But maybe not own their house.

SPEAKER_03:

Exactly. That was a... There's

SPEAKER_00:

a lot of fun stuff that happens when you're out looking at property. Yes. So we really braced ourselves to really clean up and get stuff out of there. So anyway, that's what we saw. The

SPEAKER_03:

Saturday when we found the house that I put a contract on, we had seen a couple of viable, I would frame them as viable properties in the$700,000 range. Maybe one was$750,000, one was$800,000. So as you have said... When you widen that range, you really start understanding value, all the layers of value, the willingness to pay and what you like at what price point. And ironically, at the end of that day, I think we saw five houses. Not a single one felt like we're putting an offer in. And that day, Ben was with us. We went to lunch and you had encouraged me, check out open houses. You know, take a look.

SPEAKER_00:

There's so many going on.

SPEAKER_03:

Mm-hmm. And every week, well, what I discovered is every week, there are new open houses, even in a very specific neighborhood that we were looking in. So the irony here is that You had dropped this house in the original search, the first round, and I had swiped right past it like it was a dating app. The curb appeal was like not good. I'll use my dating app metaphor. It was like, you know, guys holding a fish showing his abs. Nope. Swipe. So the curb appeal for this was not, it just didn't catch. It was

SPEAKER_00:

very plain. It wasn't exceptional. It

SPEAKER_03:

wasn't exceptional. And that was coincided with the original purchase price at 700, which when I looked at that first search, everything was, you know, in that range. And there were other houses that with better appeal at that price point. So now this house is popping up on the open house and it says just reduced to 595. And I thought a hundred thousand dollar price reduction, like, what's wrong with it, you know?

SPEAKER_00:

That's right. That's what people think. If it goes down that much, there might be something wrong with it. That's a logical thought.

SPEAKER_02:

It's funny because a lot of sellers ask that question. If I make that kind of price change, someone's going to think something's wrong with my home. But let's figure out what happened when they made that price change with the sale.

SPEAKER_03:

So I go to the open house and it's a delightful home. You know, don't judge a book by its cover, right? You get past that threshold going in the front door. You got hardwood floors and beautiful moldings.

SPEAKER_00:

You went on a Sunday. It was a Sunday. It was the next day after we had been out on Saturday. Exactly.

SPEAKER_03:

We went early. So the open house starts at 1. We were like, boom, 1.03. We were there.

SPEAKER_00:

And I think I came around 3.

SPEAKER_03:

Right. You had a showing, so you went towards the end of it.

SPEAKER_00:

Yeah. And so we saw it separately, but we jumped right in there and and saw it and it was, it was great, right?

SPEAKER_03:

It was. You had shared with me your ideas about split layouts as Declan grows older and not wanting to be anywhere near his bathroom. So I liked the split layout. I liked the original floors. I really liked the backyard because there was a, there's a, I'll call it, it's going to be my oasis.

SPEAKER_00:

It was a nice little area back there. And

SPEAKER_03:

like I, I, When we first met and you asked what's important to you about a house, I told you I don't want a big yard that I have to maintain. And then what was the selling point for this house? I'm like, look at this backyard. But we should define yard just to give a visual picture here. You exit the primary bedroom. There's an outdoor bath and an outdoor shower in this gorgeous... I don't know. It's not a gazebo, just a gorgeous setting. You know, it's shaded, it's private. And then you leave that space and the rest of the yard is, it's not, grass. It's more, I guess it's like natural grasses, but there are a lot of stations. I'll call them in the backyard. There's a hot tub. There's a little gazebo. There's a deck.

SPEAKER_00:

Yeah, it's nicely done and it's low maintenance. So I thought was, you know, even if you don't want to cut the grass, you know, having the landscape that they had there was mature, easy to maintain and, you know, flowering and very beautiful.

SPEAKER_02:

It's funny, we talk about this subject a lot in our other podcast episodes, where if you have something in your property or your home that can make someone fall in love, an area of the home that makes someone imagine themselves there, it can capture someone and really make a difference in getting a sale.

SPEAKER_00:

I agree.

SPEAKER_03:

And I told David... Another thing I told you that initial meeting, I said, I will not fall in love with a house. I am a rational person.

SPEAKER_00:

You know, and it's, that's a fact. And it is a comforts part of what we talk about that, you know, really, you know, we try to let, we ask people not to, you know, be too hard about having a pool or having a garage and, you know, keeping their mind open so that they can see lots of properties and they don't over limit things. So, What did we decide to offer on that house?

SPEAKER_03:

So we decided to offer full price. In

SPEAKER_00:

a discounted market. In

SPEAKER_03:

a discounted market right out the gate.

SPEAKER_00:

On a home that had been reduced$100,000. And I mean, that was a fantastic location. It has like the park across the street. I mean, you know, it's a boulevard. They call it a boulevard because it's got the big grassy median. I mean, the setting is fantastic. So. How did you feel about coming in at full price?

SPEAKER_03:

Well, for starters, I trust you. That

SPEAKER_00:

helps.

SPEAKER_03:

You take the lead and I may ask some questions, but that's why you hire someone that you think is good at negotiating and knows value. The other piece to this is it was the magic of that day. We had seen four other houses before this open house came up. all in the same neighborhood, like all surrounding, you know, St. Pete High, that general area. So when I saw a hundred thousand price drop and thought through the other houses at 700 to 750 in that same little spot, it seemed like there was great value. And I wanted to know the story from the seller, which I don't know that we have the full story, but we have some clues. When I went to the open house, the selling agent was there and I I asked, why the price drop? And his first simple answer is, she's extremely motivated to sell. And then he talked about her teenage daughters graduating, twin daughters. They'll be graduating this May. And they had moved here for school. And now she's ready to move on to the next phase of her life. When you went later, I don't know if you learned anything more about why the price dropped. But what I do remember you calling me after that visit is saying is, we should let the inspection process happen because I don't think this is necessarily a situation where there's some major problem here, the house itself.

SPEAKER_00:

Well, it looked like she had done many improvements to the house. And so it looked like it was well taken care of. Stuff was new. You know, it was just a well cared for house. And if it looks like it is on appearance, usually it is, especially if it's somebody who's lived there five years, like she had lived there, continuing to improve stuff, that was all an indicator that the rest of the systems would be in good shape. And that was what we found. If things look like there could be some problems on the surface, usually there are problems. But here, it looked like it was going to be fine.

SPEAKER_03:

The other piece for going in at offering price is We had already looked at one house that I wanted to put an offering at, and you came back to me and said, okay, at$750, this is probably priced appropriately. But in this neighborhood, because of going back to climate change and the hurricanes, because of the hurricane situation, a lot of people want to live here. It's high on high ground, no flood insurance, yada, yada, yada. And so that first house I wanted to put an offer in, there were like five people. several of which were cash buyers. And you asked me, do you really want to get in a bidding war with something like this? I said, no.

SPEAKER_00:

Yeah, I mean... Things can come out priced well, be very nice, and we still have that. We talk about that even though 45 days to contract is the median number, there's still houses that come out that are super nice, and there's a lot of flurry around them, and multiple people come in making offers. And at the end of the day, people probably overpaid for that house. So I just don't think it's the environment and the climate to be doing that. So was there any steps in the process that you were surprised and were like, wow, I didn't know that this was going to happen? Anything that you didn't expect as we were going through the transaction, through appraisals, inspections, that type of thing?

SPEAKER_03:

There were. I'm going to talk inspections, and then I'm going to talk loans.

SPEAKER_00:

Good.

SPEAKER_03:

So because I had not bought a home, and I was married at the time for, oh gosh, 15 years, and because he had handled... The inspection piece. Yes. I was in a very traditional relationship. Like, okay, you handle this manly stuff, right? I actually had no idea how an inspection process worked. I had had four point inspections on one home in order to do like an insurance renewal. So I understood that. But this inspection we did was so thorough. You encouraged me to come at the end of it for the summary. And somebody in my circle said, I've never gone to an inspection. I just let it happen, you know? And I thought, well, I'm going to meet David there because I want to hear this. And it was like another language. And I don't know if either you or the inspector got frustrated at any point, but I just didn't understand like half of the words or pictures. It was very... I'm a very visual learner. So the pictures really helped the pictures in the report. So, cause he would use words and I'm like, I don't even know if we're talking about like the attic or under the house right now. Like, you know, what are we talking about? So the picture story was super helpful and I'm really glad I was there. to hear that all. By the end of that meeting, I felt more confident that there was nothing major, major, right? I can get this house insured. I don't have to bring in a hundred grand to fix something, which at that point, going back to the price, okay, well, we've just lost that value of that drop. And you and the inspector helped me organize what my project list would be and what the types of things that we would go back to the seller and ask that she repair before the

SPEAKER_00:

closing. Always good to know what's going to be possible to get from the seller, what types of repairs they might do. And anyway, but it's been a very friendly transaction. I spent some time there with the plumbing contractors and, you know, we uncovered some small problems that were fixed for just a couple hundred dollars.

SPEAKER_03:

True, true. That was kind of a scare, the plumbing thing. I was very scared by that, but in the end, it was no big deal.

SPEAKER_00:

And this has been the Real Property St. Pete podcast.

SPEAKER_02:

I'm Julie Jones with Smith& Associates Real Estate.

SPEAKER_00:

And I'm David Vann with REMAX Metro.

SPEAKER_02:

Thanks for listening.