Twelve years ago today, still not really knowing my away around Seattle, I wrote a blog post talking about how anxious I was to figure out home ownership. The context was that we had just moved there, Diana and I had been married less than a year, and we both had houses in Cleveland that we couldn't sell. It was not a good scene. It got worse when someone broke into her vacant house and stole all of the copper plumbing they could reach in the basement. Recall that the recession starting in 2008 was tied to the subprime lending mess and subsequent housing market crash. At that point, I had owned my house for about nine years, and I wasn't adjusting well to apartment life, especially with a baby on the way. As the story goes, we sold Diana's house by short sale, and I still owned mine when my frustration peaked in 2011 and we moved back into my house.
As much as I still harbor resentment toward that situation, those 21 months we lived in Cleveland completely turned around our financial outlook (though it probably set me back in terms of career). It's a weird thing, that the place you live, and whether or not you own it, has a ridiculous impact on your long-term financial health. Renters are seriously disadvantaged, because they're throwing money at it and only getting a place to live. An owner gets that and, 2008 recession aside, is generally building equity toward something. And with mortgage rates being what they are the last few years, there's a good chance that their cash flow will actually be better than it was renting. That was certainly the case for us when we moved to Orange County in 2013, and moved into our own place in 2014. And the rates are so good now that, at the end of 2020, we refinanced to 2.875%, a rate so low that I didn't see any good reason to get a shorter loan.
I lost money on my house in 2013, after owning it 12 years, so we basically started from scratch. But finally, the timing worked in my favor, because of the cheap financing and the ridiculous rise in home values. If I'm to estimate our house value based on the neighborhood comps, we half-own our house after trading up from the first one we built, in just eight years. That's nuts.
As good as the news is for me, it's not good for people who are looking to be first-time homeowners. There aren't a lot of affordable houses available close to where the jobs are. The demand is too high. That leaves a lot of people in a bad situation, not only forced to rent, but rent expensive places because demand is high for rentals too. That bothers me, because it makes it more than just an act of will to get into a better situation.
These days, I'm happy about where we live. I'm still fighting the builder on some stuff (Pulte sucks hard), but I like the place. It's the longest that Diana and I have stayed in one place, too. I'm hoping we can stay here until we're empty nesting and can retire, which with any luck will be about the same time. At that point, I'm not sure what's next.