Did We Make A Profit Selling Our First House?

Are you kidding? In this market? Of course not. We managed to sell it for around $5k more than we bought it for back in 2006 (in “the bubble”) and it doesn’t take a genius to figure out that we spent more than five grand on improvements (we estimate that we spent around $35K on new bathrooms, a new kitchen, new flooring, new windows, a new roof, a new patio, a paved driveway, and upgraded details like crown molding and wider doorways). This is where a “wop-wop” sound effect would come in handy.

But we’re sleeping like babies and are downright giddy about the sale of our house and the purchase of our new one. Why? We’re 100% convinced that the time was right and everything happened the way it was meant to. Are we crazy? Maybe. But here’s our thought process:

  • Our monthly payment for the new house is $200 less than what we’ve been sending in for our old much smaller house thanks to historically low mortgage rates and a great deal on the new house (which we never could have afforded in a better market). More house in a better neighborhood for less money each month? Yes please.
  • The unimproved houses in our old neighborhood (which look a lot like ours looked back when we purchased it) are selling for 30K, 40K, even 50K less than ours sold for. So not only were our projects fun and fun to enjoy while we lived there, they seemed to help our house retain its value and even improve upon it (even though we bought it when the market was amazing and we sold when the market was, uh, not).
  • We got an offer within just a few days of being on MLS, so that’s a lot to be grateful for in this housing market.

Want more details? Sure. You know we like to talk…

We’re not house flippers, we’re house lovers (hence the blog name). We never moved into our old house intending to flip it or upgrade it for any other reason than to enjoy it and make it the perfect home for ourselves in the time that we spent there. And it was. So the fact that by doing those updates we were also able to keep the house from dropping a lot lower into a price range that actually may have made us cry ourselves to sleep at night really does feel like a blessing. And we can’t forget the inexpensive backyard wedding that we were able to host thanks to diverting our venue rental budget into a new paved driveway and cobblestone patio that were around long after our big day ended. Or the kitchen renovation that spawned a blog that spawned a business that now affords us the opportunity to both work at home with our spawn by our side (sorry for calling you “spawn” Clara- it’s a terribly un-ladylike word).

Plus, it’s easy for us to see the rewards that the new house holds. After all, we’re not just sellers in this buyers’ market – we’re buyers too. And boy is it a sweet time to buy. We’ve scored our new larger house in a nicer neighborhood at a serious discount (we paid over 40K less than it was valued five years ago). Plus since interest rates are awesomely low we’re potentially saving tens of thousands of dollars in interest over the term of the loan. And since we had some nice equity in our old house to roll over into the purchase of the new one (and thanks to that lower interest rate) that’s how we got to that lower monthly mortgage payment that we mentioned above.

Plus we figure that when/if the market recovers in who-knows-how-long, there are greater rewards to be had on our new house than if we had waited around to sell our old one (which might have gone for more money in a few years, but at that point our new house might have been waaaay out of our price range just like it was five years ago when the market was doing gangbusters). And of course we can’t ignore the most important facts: that this new house satisfies our passion for DIY, offers more room for our family to grow, and helps fuel our business. Which is really the day to day stuff that helps with the whole sleeping at night thing.

But let’s revisit that whole 35K spent on improvements, only 5K of which we actually made back in the sale price. The good news is that it’s not like our improvements didn’t serve us at all. Similar houses in our old neighborhood are now selling for muuuuuch less than ours did because they don’t have any of the updates that ours has. In fact a similar ranch on our old street (only about three houses away) that’s notably bigger than ours sold this summer for 50K less (!!!) than our house did. Which makes us feel incredibly good about the improvements that we made to set our former casa apart so that it would not only hold its value but would even creep up 5K since the good ol’ days of the bubble. So although on paper it might look like we lost 30K based on what we paid, how much we put into it, and how much we sold it for- we like to look at it like this: by making the improvements that we did, not only did our old house not drop 50K in value in this bum economy, it also slightly improved by 5K. Call it looking through rose colored glasses if you’d like, but thinking about it that way really helps keep things in perspective.

Oh and here’s another interesting house-for-sale point that our lender made. He has noticed that what homeowners aren’t getting back financially from their improvements, they’re getting back in sale speed. For example, a buyer might not pay much more for your house because it has granite counters, but you’ll get an offer a lot faster than a similar house down the street that’s sporting laminate. And that has certainly been our experience. We were on MLS for 2 days before getting an offer while a similar larger house down the road is going on four months without a bite. And it’s listed for $30k less!

Do we wish the market were better? Sure. But we’ve got zero regrets. Some may accuse us of seeing the glass as half full (and we definitely don’t think everyone would make the choice to sell at this time), but these are just a few reasons why we’re so glad to be in our new house just in time for Clara’s first Christmas. Speaking of which, we’ve got some boxes to unpack…


  1. Snickrsnack Katie says

    Well, despite not making a profit, you didn’t do too badly, and your house was barely on the market. I say, BRAVO!

  2. says

    …another super awesome tidbit you forgot to mention is that all of your updates/renovations were made without additional loans and/or debt! You paid cash for everything and so how can you feel the least bit remorseful when you don’t need the equity in order to pay off your debts!

    We picked up that tip from you guys when we moved into our house and I can safely say we’ve not accrued any further debt with our house as a result!

    Great job, guys! It’s not about earning it all back! It’s about loving it while you have it and not going completely under in the process!

  3. says

    I think your way of looking at it totally makes sense! My husband and I stretched our pennies to buy a great fixer upper two months ago that we can stay in for the next 20 years while selling our old house for a loss overall. We don’t regret it one bit.

  4. Kayla says

    You guys have taught me to think about our home in such a different way. To love it, not just to live in it. Also so much about making decisions that work for you. Who needs a second living room that never gets touched, anyways? Not me!!!!

  5. says

    Seems to me you come out smelling like roses. Keep the rose colored glasses though, you’ll need them for your bright future!!

    You certainly made a profit. Your profits buoyed your sale price above the competition, you are saving money EVERY month and you scored a bigger house. Only in crazy town is that not a profit!

    Congrats to your entire family.

    Yes, I cried when I read the post with the empty old house photos. No, I don’t know you. Yes, I have my own life. Yes, I do, I swear! I am excited to see your transformations and see how your incredible vision plays out on this new lucky abode.

    • SunshineGal85 says

      As a new-ish reader, the new house announcement yesterday has me curious about all the posts concerning the move from house #1 to house #2. Are there links somewhere that I’m not finding?

    • says

      If you click the “Categories” tab near our picture on the sidebar you’ll see a “Moving, Selling & Buying” link that will take you to all of those posts. Enjoy!


  6. Karla says

    When your house is your hobby, your business and your love, spending money on it is like breathing. No justification, no explanation and no apology required. Look at kids: would any of us have had children if felt we had to recoup every dollar invested in them? Good luck with THAT one!

  7. says

    This is such a great way to look at the process. There are so many people who feel entitled to a profit on a house sale, and that’s not always the case (especially if you’ve woken up in this market). That’s like someone always expecting a return on a stock market investment. It’s not always going to happen, and that’s not even why most of us buy houses in the first place. I think you guys did great, and I can’t wait to see your new projects come to life!

  8. says

    you are two smart cookies, you know that? you have such a great attitude, and this post is really well written and thoughtful.

    I think it’s easy to get caught up in the ‘numbers game’ in this housing market. We put a small addition on our old home, but still priced it about the same as houses without the addition. Our old neighbours said we were stupid to price it so low, and that we ‘were giving people an addition for free’. But we had 2 offers in less than two weeks, and sold for above asking. The speed of the sale was worth it, and we bought a nicer house in a better area that we could have never afforded in a booming housing market.

  9. Sharon says

    I live in Phoenix AZ where the market is even worse than in Richmond…we had a similar experience. Even though we did not make a profit on our home, we were able to sell within 14 days. That meant a lot to us to not have to carry 2 mortgages! We too have a much larger home in a better neighborhood, with a smaller mortgage. We agree: Win win!
    Congratulations on your new home!

  10. christa says

    This was a really interesting and insightful post, especially for anyone weighing the benefits of selling in a bad market…thanks for tackling the finances on the blog and not leaving us guessing!

  11. Megan says

    You all have the right attitude. When prices are high, they are high for the buyer and seller. When they are low, they are low for everyone. It’s all relative.
    You got a bigger house, better neighborhood, lower payment, and less interest over the life of the loan.
    Plus, you make renovations for you, not for the potential buyer. You all have your heads screwed on straight, although you already knew that. :)

  12. says

    See, that’s the funny thing about finances. Sometimes they tell interesting stories.

    If you look at just the sale value of the house you sold, plus the amount of the house you purchased, you would say you made a profit.

    If you nickel-and-dime the money you put into the house, plus what you originally purchased it for, minus the sales price…and compare it to the house you just purchased, looking at numbers only, it might seem like a loss.

    However…this is where your perspective is awesome, John. You realized what the house was able to translate into (your business). The comfort and ease of the nice house you all DIY’ed might not have a monetary number on it, but you can look back and say it was worth it.

    And look at the great deal on the new house! That’s the way to go…It’s all about perspective and hindsight. Great way to sum up the whole process.

  13. Keri says

    No matter what, always look at the glass half full and you will be able to sleep at night. So glad everything worked out for you guys! I’m hoping the market kind of stays like this for one more year since my husband and I will be ready to buy our first house come this summer :) You two are so inspirational!

  14. says

    That’s incredible – two days listed and already a bite?! :) Love it! I think the memories of having your wedding at home are also invaluable. :)

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