So, I sold it. The buyer, Ben, seemed like a good guy—enthusiastic about fixing up the place. We shook hands, and just like that, the house, along with its memories, was no longer mine.
A week later, I received a letter via courier. To my surprise, it was in my grandfather’s handwriting. The paper was yellowed with age, as if it had been sitting, waiting for the right moment to be delivered. My hands shook as I opened it. The message was simple but intriguing: “Check the basement of the house.”
Without wasting time, I called Ben. “Hey, it’s Alex. I need to come by the house—there’s something I need to check in the basement.”
Ben, a little puzzled but still friendly, replied, “Sure, come over. The basement’s just as you left it.”
When I arrived, I barely recognized the house. Ben had already started making improvements. The yard was cleared, and the house had a fresh coat of paint. He greeted me at the door, and we headed straight to the basement. It was still dimly lit and musty, filled with cobwebs and old furniture. Ben watched me search, amused but curious.
“You sure your grandfather wasn’t just messing with you?” he joked.
I was beginning to wonder the same thing. But then, I noticed a loose brick in the wall. Behind it was a small, dusty box containing old letters and a key. Ben peered over my shoulder. “What do you think that key unlocks?” he asked.
“I’m not sure,” I replied. But I had a feeling it was important. After thanking Ben, I took the box and key home, determined to figure out the mystery.
The next day, I returned to the house with a plan. As Ben opened the door, surprised to see me again, I made a bold offer. “Ben, I’d like to buy the house back.”
He raised an eyebrow. “Really? I thought you said it was a burden.”
Taking a deep breath, I explained. “At first, I thought selling was the right choice. But after receiving my grandfather’s letter, I’ve realized this house means more than I ever thought. It’s not just a building; it’s part of my family’s history, a legacy I need to preserve. I can’t let it go.”
Ben considered for a moment. “Well, I’ve already put in a lot of work. You’d have to offer more than what you sold it for.”
I knew this wouldn’t be easy. “How about five grand more?”
Ben shook his head. “Not enough. The market’s good, and I could sell it for a profit. How about twenty grand more?”
My heart sank. Twenty grand was a lot. But I couldn’t lose the house now. “Deal,” I said, though it hurt to agree.
Over the next week, I finalized the paperwork to buy the house back. During this time, I met Clara, a local historian with a passion for old homes. Over coffee, I shared the story of my grandfather’s house, and she was instantly intrigued.
“Your grandfather sounds incredible,” Clara said. “If you ever need help restoring the house or researching its history, I’d love to assist.”
I gratefully accepted her offer. Clara’s enthusiasm breathed new life into my project. Together, we spent hours sifting through old documents, photos, and memories, piecing together the story of the house and its significance.
Finally, with the house back in my name, I returned to the basement, key in hand. Moving aside an old wardrobe, I discovered a hidden door. The key fit perfectly. Behind the door was a small room, and in the center was a modest chest. My heart raced as I opened it, expecting treasure.
Instead, I found a letter in my grandfather’s familiar handwriting and an old poker chip.
The letter read: “I knew you would sell the house, you fool! I always taught you to honor your ancestors and remember your roots. Yet, you sold it off without a second thought. Let this be a lesson to you.”
At the bottom, in a playful tone, it said: “P.S. I put something in here, so here’s an old poker chip—worthless! Consider it a lucky charm.”
I sat there, the letter in hand, disappointed at first, but then understanding hit me. My grandfather, ever the trickster, had orchestrated this whole experience to teach me a valuable lesson. The house wasn’t just about property or money—it was about honoring the past and valuing what truly matters.
With a renewed sense of purpose, I decided to keep the house and turn it into a family retreat. What I once saw as a burden now felt like a treasure—a connection to my roots and a place where future memories would be made.
Over the months that followed, the house underwent a transformation. With Clara’s help, I restored it, blending its old charm with fresh beginnings. The house, once dilapidated, became a place of laughter and love—a symbol of family heritage.
As the final touches were added, Clara and I grew closer, spending more and more time together. The house wasn’t just a part of my past anymore—it had become a symbol of our future, a place filled with love, memories, and the lessons my grandfather had so cleverly imparted.
In the end, my grandfather had left me far more than a house. He’d left me a legacy, a lesson about family, roots, and the importance of holding on to the things that truly matter.
How to Own Your Dream Home
For most people, their first home isn’t their dream home. It starts off nice enough. But as time goes by and your family grows, starter homes tend to get a little . . . cramped.
But don’t hate on your current home too much. Because while it gave you a safe and dry place to lay your head at night, it was also setting you up to own your dream home someday.
We’ll show you how it all works and walk you through the steps that’ll get you in your dream home—one you can actually afford!
How to Get Your Dream Home in 5 Steps
Here are the steps:
- Follow the Financial Basics
- Find Out How Much Equity You Have
- Set Your New Home-Buying Budget
- Find the Right Dream Home for You
- Be Picky and Patient
Now let’s cover each step in more detail.
Step 1: Follow the Financial Basics
First thing’s first—you have to get out of debt, get on a budget, and build up an emergency fund of 3–6 months of expenses. Sounds pretty basic, right? If you haven’t completed these steps, then you’re not ready to upgrade to your dream home . . . yet.
Now, when you’ve got house fever, it can be hard to focus on paying off debt or saving an emergency fund before you upgrade your home—especially when you’re feeling the pressure of rising home prices and interest rates.
But whether it’s your second or third house, you should only buy a home when you’ve covered the financial basics we mentioned above. Then you’ll be ready to start the journey toward owning your dream house.
And that journey starts with your home equity. What’s equity? Well, we’re glad you asked . . . that brings us to the next step.
Step 2: Find Out How Much Equity You Have
Home equity is a pretty simple concept: It’s your current home’s value minus whatever you still owe on your mortgage.
See, in most cases, your home’s value increases over time. Similar to other long-term investments (like retirement accounts), homes gradually increase in value. There have been periods of ups and downs in the market to be sure, but the value of real estate has consistently gone up. According to the St. Louis Federal Reserve, the average sale price of a home has increased over 2,300% from 1965 to 2023! And in the last ten years (2013 to 2023), there’s been a 68% increase.1 As your home increases in value, so does your equity. In real estate terms, this is called appreciation.
Other factors that increase your home’s equity include:
- Added value: Home improvement projects like adding square footage, updating fixtures and appliances, or even just slapping on a new coat of paint can add value to your home.
- Mortgage paydown: Paying down your mortgage not only gets you out of debt faster, it also builds your equity. The less you owe on your home, the more equity you have.
The amount of equity you have gives you a pretty good idea of how much money you’ll end up with after selling your house. You can use that money to make a hefty down payment and cover the other costs that come with buying a home.
Find expert agents to help you buy your home.
So, how do you determine your home’s value? Well, you can get a ballpark estimate on real estate websites like Zillow, ask a trusted real estate agent to perform a competitive market analysis (which they’ll do anyway if they’re helping you sell your house), or get a professional appraisal.
Finding out your home’s equity will involve a little math, but it’s third-grade-level stuff, so don’t sweat it.
Here’s what we mean. Let’s say your home’s current value is $355,000. When you sell that house, you’ll have to pay for between 1–3% of the sale price in closing costs, another 6% in fees for the real estate agent who helped you sell it, and whatever’s left to pay off on your mortgage.
That means you can estimate clearing over $223,000 from selling your house. That’s a killer down payment on your dream home! And if your home is paid off, that’s even more money to put down and use to pay for things like repairs and moving expenses.
Step 3: Set Your Dream Home Budget
Once you know how much you’ll clear from the sale of your home, you can start making a budget for your dream home.
The key to owning your dream home (instead of it owning you) is to keep your mortgage payment to no more than 25% of your take-home pay on a 15-year fixed-rate mortgage, along with paying a down payment of at least 20% to avoid private mortgage insurance (PMI). Never get a 30-year mortgage even if the bank offers it (and they will). You’d pay a fortune in interest—money that should go toward building your wealth, not the bank’s.
So, let’s say your take-home pay is $4,800 a month. That means your monthly mortgage payment shouldn’t be any bigger than $1,200. By the way, that 25% figure should also include other home fees collected every month with the mortgage payment like homeowners association (HOA) fees, insurance premiums and property taxes.
Plug your numbers into our mortgage calculator to see how much house you can afford.
And don’t forget to budget for all those other costs that come with the home-buying process in addition to your closing fees—things like moving expenses and any upgrades or repairs you might need to make. You don’t want these hidden costs to catch you off guard or drain your emergency fund.
Step 4: Find the Right Dream Home for You
This is where things get real. After all your hard work building up your equity (and doing a lot of math—don’t forget that), you’re finally ready to start the house hunt. Woo-hoo!
But don’t lose focus. Stay zoned in by making a list of features that make a home fit your budget, lifestyle and dreams—and stick to it throughout your house hunt. Here are a few ideas to get you started.
- Don’t compromise on location and layout. If you plan to be in this home for the long haul, an out-of-the-way neighborhood or a wacky floor plan is a deal breaker. Look for a community and layout that’ll suit your lifestyle now and for years to come.
- Think about how much space your family needs. While your budget has the final say about how much home you buy, you’ll want your dream home to fit your family’s needs through different life seasons.
- Consider the school districts. If you have or want kids, the quality of the nearby school districts is probably already on your mind. But even if you don’t have kids or you’re retired, keep in mind that having good schools nearby could increase your home’s value.
- Look for a house that’ll grow in value. Are home values rising in the area? Is the number of businesses going up? These factors can help you figure out whether your dream home will turn into a good investment.
- Count the costs. Want that fancy master bathroom with the multiple showerheads and the Jacuzzi tub? Be clear on what’s a must-have and what’s nice to have. And don’t forget, upgraded features like that will make your dream home more expensive.
Step 5: Be Picky and Patient
We know you’re anxious to get into those new digs, but be patient. Wait for the right house at the right time. Don’t spend your money on a less-than-ideal home just because you’re tired of looking.
The key is finding a good real estate agent who understands your budget and refuses to settle for “good enough.” They’re as committed to your dream as you are and will have your back throughout the entire process, no matter what it takes.
In addition to teaming up with a great real estate agent, you can take a couple of extra steps to make sure you’re ready to strike as soon as the right home comes up:
- Get preapproved for a 15-year fixed-rate mortgage. Having preapproved financing is a green flag for sellers—especially in multiple offer situations. And because this puts most of your information in the lender’s system, you’ll be on the fast track to closing once your offer is accepted.
- Offer earnest money with your bid. Earnest money is a deposit to show you’re truly interested in a home. Usually it’s 1–2% of the home’s purchase price and it’s applied to your down payment or closing costs. Even if the deal falls through, you can almost always get most of it back.
Find a Real Estate Expert in Your Local Market
Now, you might be thinking you have some work to do before you’re ready to find your dream home. Or you may be realizing your years of hard work are about to pay off! Regardless, if you follow these steps, you’ll find the house you’ve always wanted and avoid a purchase you’ll regret.
Once you’re ready, connect with one of our RamseyTrusted real estate agents. These are high-performing agents who do business the Ramsey way and share your values so you can rest easy knowing the search for your dream home is in the right hands.
Find the only real estate agents in your area we trust, and start the hunt for your dream home!
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