June 15, 2008
I have run into a small hitch in my attempt to buy a piece of property for improvement; I can’t get a mortgage. My tax returns for 2007 show a low income because I spent a great part of the year working on my own house prior to selling it in September. The only thing I can get is a no document loan, which requires 20-25% down. I have about $25,000. Which would qualify me for $80-100,000. There is nothing listed in the area for that little. There are a handful of small, rundown properties in out of the way locations for not much more than that.
I need to make a decision about where to invest the money I have before it is twittered away on living expenses. I figure that housing is my best bet; houses are what I know and what I do. I could try the stock market but I know little about the stock market, I might also try to think of another business idea, I do have experience and knowledge of small business although I don’t have any immediate good ideas for one. If I decide to stay in housing, I need to look carefully at the small places that are for sale and be prepared to act on something. This money must be invested and it must be invested soon.

June 9, 2008
It is hot and humid today, I stopped by the little house on Route 53 and walked around the yard again to see if I would have any flashes of insight. I need to make a decision. The traffic again was loud, the yard actually is upland, with a decent lawn and quite a few trees. Someone has placed potted geraniums around, and the grass is cut so someone must be tending it; but I saw no one.
It says that Mass Housing financing is available. I called the Coldwell mortgage broker and left a message saying I wanted to find out what that meant. He called me back a few hours later. He is going to send me an application form for pre-approval. My feeling is that if I don’t have a large amount of money to put down, I will not get a re-hab loan or a new construction loan, so I will have to go for the more traditional homeowner’s loan and then refinance. I need to do some research not only on loans but also on property values.

June 8, 2008

Thursday I looked at a house in Duxbury on route 53 near the Kingston line. Mike B went with me, we met Peter N from Coldwell Banker who let us in to see the house. It is an old one story cape with an attached garage on almost an acre of land. The neighbor on the south is obscured in the trees, the neighbor on the north is too close for privacy behind a short chain link fence. There is a stump of a very large pine tree in the middle of the back yard. The sound of traffic was very noticeable to me when we were inside the house. The windows are old single pane, the garage door is home-made, and too small for most vehicles. The front of the house is too deep in the ground and the sill may be rotten but there was no access to the crawl space under the house to check it out. The grassy yard sloped up slightly in the back channeling water down towards the building.
Inside there is a living room taking up the front of the house, a bathroom off the living room, and a small, outdated kitchen contiguous with the living room on the other sid. The kitchen has the main entry door off the driveway. There are three small bedrooms off the kitchen with passage through the central bedroom necessary to reach the other two, one on each side of it. There is a pull-down stairway in the bedroom adjacent to the garage which accesses a small attic space. In the kitchen there is a closet with the furnace and water heater. In theceiling of the closet you can see into the main attic area which appears to be sizable but in rough shape. Peter said that a squirrel had died and smelled up the house as well as filling it with flies.
This house is listed for $299,900. It has several advantages, it has a sizeable lot for the price range, it is close to a lot of stores and not far from the commuter rail, it has a relatively new septic system supposedly sized for 4 bedrooms, it has a garage, it is liveable but it needs work so I could move in and work on it as my own residence. This house had been owned by a couple in Woburn and rented out. There was not supposed to be a tenant but someone’s personal things were still there. Some negatives are it’s poor condition, its location next to Route 53 and away from the center of town and the beaches.
The insulation in the attic is messed up and needs to be fixed, the walls may or may not have insulation in them. The windows need to be upgraded, the kitchen needs to be upgraded. There is no garage floor, but that can be easily remedied. The ceilings are homosote, with battens on the seams, the layout is terrible. Some possible improvements are, a wooden fence on the neighbors side, arbor vitae or spruce along the street, clean out the dirt and overgrown plantings along the front. Ideally the house would be lifted up and another row of block added to the foundation. It could use a deck in the back and a new sliding glass door.
I noticed that Mike was keeping his thoughts to himself. So I asked him directly, “what do you think about that house”.
“I think you’re making a big mistake, “ he said.
For me the potential is that with the correct financing it could provide work for the winter, and then become a rental when I move in with Pam. I need to talk to a mortgage broker. But the important thing is not just to finance the purchase but to finance the improvements, the one thing I do not want to do is to put down all I have, take on a mortgage payment in a bad economy and then be stuck for money to fix it up.