How I Went from Comfortable to House Poor

This is a true story that I hope will serve as a warning to other first-time home buyers. My wife and I rented a home for the first five years of our marriage. After us working, saving, and scrapping for half a decade, my promotion enabled us with what we thought was the financial freedom to finally be able to afford our first home.

We wanted to do everything right from the get-go. We hired a mortgage consultant and we shared all of our private financial information including what assets we owned, our pay stubs, and shared details about our plans for the future. Our consultant told us what we could afford and even secured us a pre-approved mortgage. 

It was great to able to shop for our first home, knowing that our pre-approved mortgage allowed us to sign on the dotted line, without having to worry about more than our down payment.

If we only knew what we know now we could have avoided being house poor

Of course, at the time we had no idea what house poor meant. Now we understand that it means that what we can afford are only guidelines and we needed to take more into consideration than our down payment, ongoing mortgage payments and moving expenses.

This is how we became a financial slave to our home

We were wise enough to factor in our car payments, utility bills, entertainment budget and so forth but we were completely unprepared for the “hidden costs of owning a home.”

Our first jarring experience was within the first few days of moving in. After a particularly cold winter night we turned on the kitchen tap and no water came out. Moments later we heard a burst, followed by what sounded like water pouring into the basement. Unfortunately, that is exactly what it was.

Our pipe froze and burst. This caused an incredible amount of damage to the walls, carpets and all of the items that we were storing in the basement. This was a disaster that could not be foreseen. We had a home inspection performed before purchasing the home and everything checked out. The roof had recently been replaced and the plumbing was in good condition. In any case, this cost us a great deal of the budget we had set aside for minor repairs, painting and the new dishwasher, which we quickly realized would have to be put on hold.

And Then…

The second unforeseeable event was caused by our neighbours, who immediate complained that every house on the street had a landscaped front yard, and our home’s plain and overgrown front yard was lowering their property value. We planned to stay in our home to raise a family and the last thing we wanted was to upset our new neighbours. We already knew that come spring, we were going to have to hire a landscaper, or learn very quickly.

These may seem like minor examples as far as home buying experiences go but for a young couple on a budget, we wish we hadn’t spent our upper limit because now we see first-hand how easy it is to go from comfortable to house poor. 


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