HELP! I CANT BUY A HOUSE... Yet.

[Zachary Zimmermann]

BP I need some wisdom. 

I am in my early 20s. I got married a little over a year ago. Both my wife and I are moving to Nashville TN because of our careers (a much more expensive/competitive market than where we have been living the past 5 years, Chattanooga TN). I have spent the last 3.5 years working side hustles, cutting spending, doing anything and everything I can do to have enough money for a down payment, closing costs, and rehab expenses. I am proud to say that financially we are in a place to make a move on a house. I have spent hours reading/listening/spending time with investors, and I feel confident in my knowledge (at least the knowledge that it takes to take the first steps in buying a house and starting an investment in real estate).

But here is the issue.  

It is so dang competitive right now. We have spent the past few months putting in over 25+ offers on houses in which we get blown out of the water by cash offers (which is not rare at all in middle Tennessee right now, why would anyone not want to move here!) Offers where we have even stated that we are willing to pay 30k+ over the asking price. We have managed to have 2 houses now under contract but one fell apart due to inspection red flags, and the other fell apart because it didn't appraise for what we were willing to pay for it and the seller wouldn't come down at all.

If the definition of insanity is "doing the same thing over and over again and expecting different results", then I am insane. I cant compete with these cash buyers from out of state. I think I have to look at it differently, and thats why I am coming to y'all. 

As I stare at a lease agreement ready to hurl thinking about having to rent rather than owning, since we HAVE to find a place to live, I need your advice. Is it ok for me to rent for a while? Do I just shut up, stop complaining, and keep looking? Is this just how the market is right now and I should wait until it slows down? 

I am welcoming any advice you have. Your words will be going to help a young married couple, a minister and a nurse, start on their path to financial freedom.   

[David Goodman]

@Zachary Zimmermann

Hey Zach - there was a good podcast a couple months ago about being careful not to set artificial timelines on a home purchase. “My lease is due and I need to buy now!” I hear it all the time. I thinks it’s okay to secure a rental while your shopping for a home. If you find the home that works for you, see what it will cost you to break the lease. Normally you lose the deposit and that’s about it…

At the same time, I think taking action is a good thing. Yes, the price today you will pay on a Nashville home is higher than it was yesterday. Will that trend continue? Will that same home be worth more in a year or less?

My bet is that we will continue to appreciate rapidly over the next 2 years.

So don’t rush, but continue to take action.