Three Month Update

I haven't written in a while, as you can read, mainly because of a cyber stalker vitiating every website I belonged to; but hopefully he's moved on and I can continue doing the things I love, writing and developing healthy relationships with people who value the same things I do: family, friends, education, politics, etc.

So what have I been up to? To begin, I'm in escrow on the model of home that you see in the picture above. It is currently being constructed by KB homes. To boot, I will be taking advantage of a state and federal tax credit that will line my pockets with $18,000 after I move in and amend my 2008 taxes. I boast, though I do it humbly, knowing that there are many out there who are not as fortunate as I am. However, I will say proudly that this will be my first home and I've fought tooth and nail to get it, saving, researching, and ostensibly sacrificing many enjoyments for the sake of providing my family with much more than I had as a child. In fact, I am incredibly grateful for the work ethic that was instilled in me during my childhood as a result of mowing lawns and working at Del Taco, though a brief recess from reality during college turned me into a penniless, debt-ridden student which haunted me until the past few years when I was able to control it and rebuild my credit.

Although credit repaired, I had just about written off owning a home. I thought that if housing prices continued to increase or even level off and stay as high as they were, I'd just as well be a renter for the rest of my life. I remember talking with friends about this at the local watering hole, GFE coffee shop. I argued that I would never have a mortgage I could not afford. So, when the housing bubble burst and housing prices plummeted, there I was, first in line with my savings and good credit, ready to buy. And Buy I did!

After some research, and a horrible real estate agent, I found online that KB homes was still building houses in the area, and at "very" affordable prices. So, one day I stopped by the KB office located in one of their model homes and talked to an agent about the process. It was unbelievably simple. In fact, for over a year, I looked at previously owned homes and even bid on 6 of them, but always lost out to higher bidders, usually to people with cash. I assumed they were buyers who sold their homes for $300+ thousand during the housing boom and now had cash in hand for houses 50-60% lower in price than their previous home. In contrast, the process of having a house built didn't involve behind closed door bidding wars, or even dealing with other potential buyers at that. It was a first come, first serve transaction that included merely having a "Pre-approval" from a lender, $2000 deposit for the lot premium, and a down payment of 3.5% (FHA loan minimum). That weekend I signed the papers, made the deposit, and now I'm waiting for them to finish building my home.

Purchasing a home changes one immensely! First of all, I've become a huge fan of HGTV, perusing every show for design ideas, landscaping techniques, and first-time home buying tips. It is not uncommon for me to stay up well into midnight watching shows merely for painting styles, knowing that I need to wake up early for work the next day. But all the hard work will pay off. Already I have a clear understanding of how to install flagstone walkways, and build a wood deck, and you can bet your bottom dollar that I will do both with that tax credit money.

I know that home ownership is not for everyone. As of June, the national unemployment rate is 9.7 percent, and locally (San Bernardino) 12.8%, though I believe it's higher because these statistics only report those who qualify for unemployment benefits. I assume it's closer to 14-15% locally. To add to these woes, the metro foreclosure rate for Riverside-San Bernardino ranks 5th in the nation, and that's set to rise, as the next round of foreclosures will be from those who before the crash had perfectly good credit and even reasonable mortgages, but because they are now out of work, they can't make their mortgage payments. It will also come from those who refinanced under the boom and didn't reinvest into their homes. Instead, they bought "toys": off-road vehicles, cars, motorcycles, etc, all of which require expensive vehicle registration fees. Now their weighted under massive debt and their home isn't worth the amount of their refi.

If there is one thing we as a nation can learn from this economic crash, it's that we must begin to be more frugal and even savvy with our finances. It's time that we quit living in excess and stop shopping for needless crap: large flat screen TVs, big trucks, worthless collectibles etc. and start thinking about our future and our children's futures. With that said, I hope many will come out of these hard economic times in much better shape, financially, than they went into it.