People impulsively buy a ton of junk. A candy bar here, a random book there, a cute sweater they saw while shopping. These tiny purchases bring us joy and don’t cost a ton of money.
Not many people impulse buy houses.
But I did.
Here’s why I bought a house on impulse, and how I feel about it three years later.
I Wasn’t House Hunting
A lot of people say they’ve impulse-bought a house. But when you dig deep, you realize that they were actually house hunting.
They saw many houses, liking some and disliking others, until one day, they stepped into a miraculous home that just had to be theirs. They put in an offer right then and there, above the asking price and their budget.
This was it. They’re getting this house.
The purchase may have seemed impulsive to them, but it really wasn’t. They were looking, had an idea of what they wanted, and found something that checked all their boxes.
I didn’t do that. I wasn’t actively house hunting when I impulsively bought a house.
Not an Investment
Lots of real estate investors buy houses on impulse, but they’re doing it from a business perspective.
They want more doors, and a deal popped up that they can’t say no to. If they don’t nab it now, someone else will!
Sure, that’s an impulsive buy, but they’re experts who can spot a great deal.
I didn’t buy my house as an investment – I bought something to live in.
Truly Impulse Buying a House
When I bought my house, it was a 100% impulse buy.
We lived in a small apartment, and our lease was nearly up. Housing prices were rising along with interest rates, and I didn’t think I’d be able to afford a home in our area. I considered upgrading to a two-bedroom apartment so we’d have more room, but I decided to check Zillow to see what was out there, just for fun.
I discovered a new neighborhood popping up about 20 minutes outside the city. The cheapest houses on the lot were priced in the mid-250s, making them the most affordable homes within a 50-mile radius.
However, with the high property tax rates in the state and rising interest rates, I knew I couldn’t afford a mortgage on even the smallest model, the 250K house.
It was just out of reach.
Checking it Out Anyway
While in the area one day, my husband and I decided to stop in and check out these new builds. We looked at the smaller option, still priced around 250K. Although bigger than our apartment, it was too small to invest in for a long-term housing solution.
It was fun to look at, though.
The salesperson said we should look at the larger model, which just came down to about 300K from a whopping 350.
I knew I couldn’t afford 300 based on interest rates, but we were there. Why not look?
The Perfect House
The house was perfect. It had three bedrooms, two bathrooms, a garage, and an open floor plan. It had a yard big enough for our dogs and enough room for entertaining.
My husband and I both fell in love.
But, alas, 300K at 7% was too much. We couldn’t afford it.
But Wait, a Special Builder’s Rate?
As I chatted with the builder outside about the property, he let something slip that instantly changed my mind.
The builder offered a special rate of just 4.5% for the life of the loan if we financed with them.
4.5%!!!
At this time, rates around the country were soaring to 7%, and some were even higher!
Skeptical, I asked him how they could manage such a rate. He said that as national builders, they scoop up tons of loans each year and still have plenty available with lower rates. I asked if it was an ARM (adjustable rate mortgage), knowing some shady financers will try to trick folks into these dangerous products, but nope, he guaranteed it was a 30-year fixed.
I pulled out my calculator and did some quick math.
I could afford a 300K mortgage at 4.5%
Sign Me Up!
We went to the office, and I signed the paperwork (after I double-checked, it was indeed 4.5% on a 30-year mortgage). We didn’t even look at another house.
We moved in about a month later.
Three Years Later – Do I Regret Impulse Buying a House?
I love my house, and I can afford it. For the first two years, I was thrilled with my decision.
Property values fell, but I was in it for the long term, and I knew the city and surrounding area were still growing, so it was only a matter of time before they went back up. In the meantime, I could enjoy lower property tax payments.
But now, I’m not so sure. The value plummeted by $50,000, and my work situation changed. When I bought, I was able to telework twice a week, so the commute wasn’t so bad. Then, I got a fully remote job, and things were perfect.
Unfortunately, I was forced to report to an office five days a week, and the commute has been devastating. I love my house, but I hardly spend any time here. I can’t afford to sell it to move closer to the office.
I never thought my work situation would change so drastically, so I don’t know if I regret impulse buying a house, or if I’m sad and angry about everything else. I couldn’t have predicted the current situation, so even if I had researched, I might have made the same decision.
Either way, I’ll probably sell as soon as I can afford to, as I feel trapped in a housing situation that’s no longer working.