Kristine Dowhan knew she wanted a home, but wasn’t quite sure how she was going to get there. She was a single woman living in Florida making less than $60,000 a year. While this was a substantial income to live on, it wasn’t enough to buy a home, let alone her dream home.
Maybe you’ve felt like this too. You dream of owning a home and making it perfect for you and your lifestyle. But, easier said than done.
Dowhan put the doubt behind her and decided to go for it. She viewed real estate as a smart investment and knew it would be worth it in the end.
In 2011, Dowhan bought her first home in Detroit when the real estate prices were extremely cheap. She took advantage of this decrease in prices and paid for a home in cash.
Since she had paid for college mostly in scholarships, student loan debt wasn’t something to worry about. The prices were low, she didn’t have debt, and it was now or never. She saved up about $30,000 in 7 months. Instead of putting a down payment on a nice home in a great neighborhood, she decided to pay cash for a fixer-upper.
This home is where Dowhan spent the next 2 years upgrading, refurnishing, and improving her new space. This proved to be a challenge. Not only did she have to pay mortgage on a modest salary, but she also had to shell out the cash to turn this fixer-upper into a livable home.
This task proved to be anything but easy. Dohan washed all her dishes in the laundry room and lived within half-finished walls and countertops.
“I lived with no countertops for a year and a half because I wanted granite, and I was saving,” she told The Penny Hoarder.
It was tough, but worth the pay off. When the time came for her to move, her home was market-ready.
When a job opportunity popped up in Florida, she immediately started looking for real estate that she could potentially invest in. She sold her fixed-up Detroit home for $90,000 leaving her with a sizable downpayment.
She found a home Florida and negotiated the price down to $425,000. It was a stretch, but she knew that she could make it work.
To help pay off her mortgage, she decided to rent out rooms to Airbnb guests in order to earn extra money. Since she didn’t have the funds to buy mattresses and furniture for each room, Dowhan had to get crafty. She searched high and low for all the free items she could find on craigslist. After finding a couple free beds online, she opened her rooms up for rent on Airbnb.
As time went on, she became a pro at finding cheap gems. Whether it was online or free furniture on the road that was on it’s way to the dump, Dowhan was able to furnish her home without spending a dime.
Dowhan took her Airbnb skills one step further and decided to make the master bedroom it’s own separate, “home.” She knew if she listed her Airbnb as an entire residence rather than just renting a room, business would improve. The master bedroom was large and had its own entrance. She set up a makeshift pantry and fridge to make it feel more homey.
“It really was like a glorified dorm room,” she told The Penny Hoarder. “But I knew if I put up with this on the weekends, then during the week, I’m living in a half-million dollar house for free.”
In the first year she made over $35,000 from Airbnb alone. During this year, she continued to negotiate her salary to earn as much as she could during this crucial time.
She continued to do this until she met her, now husband, Michael. With everything she saved plus a second source of income they were able to purchase their dream home together that is now valued at over $580,000.
Dowhan explains that she took a lot of risks, but it was worth it in the end. It was about spending the money where it had to be spent, and getting crafty with everything else. She didn’t live a glamorous life, and it took years for all the hard work to pay off, but in the end she accomplished what she set out to do!
For more advice to buy your first home, check out our home-owner’s guide here!
Via: The Penny Hoarder