Buying a house

As my financial situation gradually begins to stabilize, the prospect of actually buying a house begins to seem almost a realistic expectation. Not that I am actually seriously considering such an action, but at least it is starting to become an imaginable possibility.

The idea first popped into my head when I was reading so many accounts about how the housing boom is imploding and housing prices beginning to decline. That suggested that at some stage somebody might be so desperate to sell or to finance a mortgage that even I might be considered for a home mortgage.

So, I am sitting here today wondering if a year from now the purchase of a home might be a realistic scenario. Yes, it might be, but I'm not going to spend significant effort to pursue it.

A number of "planets" would have to come into alignment before I would considering "buying":

1. Be in my new job long enough to feel that it is secure and that I am unlikely to consider moving on to another geographic area for employment. Steady, reliable income is essential to "committing" to a mortgage.
2. My net worth far enough into positive territory that I feel financially "secure", and not "worried" on a month-to-month basis.
3. Pay down my back taxes, either completely or far enough that the balance and monthly payments are a non-issue.
4. Have enough of a lead on retirement savings that I feel that diverting resources to owning and maintaining a home will not put my retirement finances at risk.
5. Have a large enough "rainy day" fund to be able to handle expected and even unexpected contingencies. Home ownership will require an even larger rainy day fund.

It's quite possible that a year from now I might be "there", but I suspect it could be more like two years before I have enough money in the bank and investments to feel truly comfortable becoming a homeowner.

For the record, I have been a homeowner in the past, twice, back in the late 1970's and early 1980's. I simply concluded that the "joys" of owning a home weren't for me.

If I were to consider "buying", I'd be more likely to get a condo than a house, and in downtown Seattle rather than out in "The Burbs".

But even all of these assumptions could go out the window if the right opportunity came along. For example, it's quite possible that if the housing boom melts down rapidly and deeply enough, there could be enough fire sales that I could well become a prime candidate and targeted for buying, even with my somewhat shaky finances.

It's difficult to recall that three years ago I was financially in very dire straights, but today my financial picture is so much brighter.

-- Jack Krupansky