How far would you go to own a home of your own? Mikey Cofer, who's morphed from a Texas-bred environmental scientist to a local photographer and artist, is testing that right now...

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How far would you go
to own a home of your own?

Mikey Cofer, who’s morphed from a Texas-bred environmental scientist to a local photographer and artist, is testing that right now. In the spirit of the season — “Christma-hannu-kwanza-kah,” she inventively calls it — Cofer is trying to sell houses in order to buy one.

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Her brainstorming product: a teeny-tiny plastic farmhouse stuffed with 22 itty-bitty plastic people and critters she’ll mail direct to your doorstep for $6.99.

If she can sell 10,000 of these Chinese-made “Tiny Plastic Huts,” Cofer figures she’ll have scored the down payment for her own hut. Actually, make that a modest house in Hoquiam she can share with boyfriend John Poetzel. They say a fixer will do.

As of last week, Cofer had sold 15 huts via her Web site: www.tinyplastichuts.com.

Only 9,985 to go.


First-time-buyer tips from a pro




Anthony Vega,
director of the Seattle King County Association of Realtors, offers this advice for first-time buyers:


“Be diligent,
patient and hook up with a very good agent and mortgage broker. Ask around for a referral to someone who has a proven track record with first-time buyers. A good agent will make sure you are on top of the market — not just the Multiple Listing Service. A good mortgage broker will have an array of flexible plans that can often help a client in multiple offer situations. They will also spend time with you to look at your overall financial situation to assess when, where, how you should go about purchasing your home.


“Keep your money in the bank
and don’t open many new lines of credit. While a good credit history is important, if you are in the top of your price range (which means the house you want is priced near your maximum loan limit), last-minute credit inquiries can affect your overall score. Also, “seasoned” money is important. Lenders don’t like lots of “fresh” cash.


“Last of all, have a good time!
People tend to get very stressed out and sometimes make decisions that they regret in the future. The more relaxed you stay, the more focused you can be.”

Elizabeth Rhodes, Seattle Times staff reporter


But the potential is so ripe, she figures, particularly after USA Today noticed her Web site. “We’re generally opposed to Web panhandlers,” the paper wrote in its Hot Sites Web Guide, “but this project won us over with its creativity.”

While she may be a self-confessed dreamer, Cofer is realist enough not to put all her eggs (from the hut’s miniature chickens?) in one basket. Indeed, she’s only purchased, wholesale, three dozen Tiny Huts “to see what happens. Nobody wants to have 10,000 huts in their house,” she reasons.

Cofer also is plowing every penny she earns from her other Web businesses, a T-shirt firm and photography sales, into her down-payment piggy bank. Poetzel, meanwhile, is paying their living expenses from his earnings as a Web entrepreneur. (He sells mosaic tiles via www.mosaictilearts.com.)


Their resolve not unusual

While selling Tiny Huts through the Internet may be a novel way of bankrolling a down-payment, the couple’s determination isn’t unusual, according to Ozzie Boyle, who teaches free first-time home-buyers courses.

“People who have the commitment and are willing to sacrifice in the short term to gain in the long term are the ones who buy real estate,” says Boyle. “Each person has to decide what sacrifices they’re willing to make.”

For Cofer and Poetzel, one sacrifice is abandoning their dream of living in Ballard in favor of decidedly less trendy Hoquiam, where Poetzel figures a 1920s Craftsman in modest condition can still be had for $100,000 or so. (King County housing prices have shot up about 10 percent in the last year; houses now fetch a median $336,000 and condos $202,000, according to the Northwest Multiple Listing Service.) Cofer and Poetzel also reduced their rent by moving from Seattle to Tacoma.

After teaching the home-buying ropes to numbers of first-timers, Boyle says the three things he’s seen them do that put them into houses are these:

• First, they absolutely commit to the idea — and ignore the nay-sayers who tell them homes are too expensive and it can’t be done. It can, Boyle says, recalling a newcomer to America who spoke little English and had just $50 in savings. But he had good credit and a decent income, and with that was able to buy a Mukilteo condo with no money down.

• Secondly and thirdly, successful first-time buyers also “figure out how to get their rent under control and their debt under control,” Boyle has observed. “Some move back in with their parents. Some get an extra job.” He’s also seen them sell a car to save money and take the bus instead.


Autos were key



Information



For more on special loan programs: C

ontact the Community Home Ownership Center, a nonprofit home-buyer information clearinghouse, at www.choc-wa.org or 800-317-2918. The center also has information about free first-time buyer seminars.


A schedule of Ozzie Boyle’s free classes

is available at www.realestatefordummies.net


Automobiles emerged as a significant factor for readers who answered a recent Times request for their tips on how to realize a first home.

Kenmore homeowner Tom Taylor says the best decision he made was to not reward himself with a brand-new car when he graduated from college.

“I could have bought that $25,000 Mustang GT convertible with $2,000 down and a five-year, 11 percent loan,” Taylor recalls. “In five years, I would have paid $38,756.34 for that Mustang. Instead, I bought a 20-year-old Chrysler for $1,000 and in less than five years bought my first house for $180,000 with a $40,000 down payment.”

Brett and Brenda Stav likewise set their priorities early. “Do you want to get married and have a big wedding?” Brett asks rhetorically. “We eloped in Las Vegas. Do you need two cars, or a big, flashy SUV? We settled on a used car.”

They also chose “to live in a cheap, one-bedroom apartment for the first five years and used the savings to pay off our student loans and (single) car.” All that paved the way to saving for a home of their own in Northeast Seattle. The Stavs bought it just last month.

Keri Holmboe, who purchased a house in Renton last year, also took a hard look at her lifestyle.

“I packed my belongings into boxes, rented a storage space and moved out of my high-rent apartment,” Holmboe recounts. “I was able to house-sit for a friend for two months before finding a small studio in which to reside for the rest of the year. It was a hassle, but I saved $800-$900 per month,” which she had automatically funneled to a savings account.

Holmboe recalls the studio as dark and ant-infested, and confesses that at times she felt deprived. “So I tried to focus on the positive and spent much of my spare time exploring neighborhoods around Seattle, comparing housing prices.”

Recent first-time buyers Judy Moynahan and John Lang also were able to purchase because they made strategic adjustments to their spending habits.

“The house was very important,” says Moynahan, “so whenever I thought about buying something, I’d ask myself, ‘Do I want this or do I want a house?’ “

Foregoing department stores, she bought and sold clothing on eBay and at local consignment shops.

Dining out was restricted to an occasional meal with friends; otherwise the couple prepared their own food, including lunches they packed for work. That had a side benefit. “We eat healthier now,” Moynahan says.

And any unexpected cash that came their way — bonuses, birthday money, even jury-duty pay — went into the house account.


Kept credit clean

GREG GILBERT / THE SEATTLE TIMES
An up-close view of the toys that Mikey Cofer and John Poetzel are selling to raise money for a house. Besides the toy plan, Cofer and Poetzel have moved to reduce their rent, dedicated other earnings to their down payment and adjusted their vision of a dream home.

Moynahan and Lang also did what several real-estate pros who answered The Times query suggested: They kept their credit clean and got creative about financing.

Rather than making a down payment, they chose to finance 100 percent of the cost of their home, as well as some of the closing costs. That meant their actual outlay was around $5,000, which they paid in various taxes and fees.

And they managed to do this without having to pay for private mortgage insurance (PMI), which usually is required when buyers have less than a 20 percent down payment.

How did they do it? By taking out two loans with the same lender: the first for 80 percent of the purchase price, the second for the remaining 20 percent. And there was even an added bonus:

“It allowed us to buy more house than we could have afforded by about $40,000,” Moynahan reveals.

According to Joni Ribera, an agent in Windermere’s Federal Way office, what this couple did is more the norm than not. Besides financing 100 percent of the home’s cost, some also use special programs that utilize seller-financing of the closing costs.

“I can negotiate this in different ways,” says Ribera, adding, “Much of my success comes from teaming with a mortgage broker who is hardworking, knowledgeable, is familiar with 100-percent financing and where both of us are willing to give our all to make the dream of homeownership work for our clients.

“I love the look on their faces when I hand over the key to their very first home that they never thought they could purchase!”


Total financing


Darren Fricke, a HomeStreet Bank loan officer, likewise is sold on 100 percent financing for first-time buyers. One big advantage, he says, is that they instantly begin earning equity on their investment.

“If they wait and save for the down payment, the price of the home will be higher,” observes Fricke, and “they may end up pricing themselves out of their intended market trying to save.” To understand what that means, consider that a North Seattle house that cost $180,000 five years ago would sell for around $250,000 today.

Mental flexibility also helped buyers realize their dream, particularly when it came to neighborhoods. Moynahan and Lang, for example, bought in Ballard after renting in Wallingford for 12 years because, “Wallingford is about $100,000 over our budget!”

Is Moynahan sad about that? No, she’s realistic. “You may be able to buy in an area you really want after a couple of years because you will build equity in the house and the value will increase.”

Mike Ristow did exactly that, not once but twice. It all started years ago when he read two books, George Clason’s “The Richest Man in Babylon” and “Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money” by Robert Kiyosaki and Sharon Lechter.

Ristow says these books taught him extremely valuable lessons. “Pay yourself first. Always save 10 percent of your income for investment only. Invest wisely, and over time it will create huge passive income. Understand the tax laws and position yourself to legally pay less tax. This is huge!”

But it wasn’t easy, he admits. “Tradeoffs were living below my means, being jealous watching friends take trips, buy new cars, while I was living with dozens of wacky roommates, saving for a house. I had to be patient (because) my income was lower than most of my friends’ “

To make the situation even more difficult, Seattle native Ristow had moved to San Diego, where housing prices were significantly higher than here. Still, he managed to buy that first house there, get married and then, by again living below his means, amass $80,000 in eight years.

It went to buy his second home in — ready for this? — Hawaii. Kona, to be precise. With a view of the Pacific. It’s an investment, and Ristow is happy to let renters make his mortgage payments.

Elizabeth Rhodes: erhodes@seattletimes.com