real estate

This couple was saving for their first home in Chicago, but bought a $25,000 house in Italy instead

"We knew we didn't necessarily want to move back straight away but more as a long-term investment and we could maybe retire there," Knighten tells CNBC Make It.

Kristina Knighten

Kristina Knighten and her husband, Paul Cordier, were living in the United Arab Emirates and working as TEFL-certified teachers when they decided they were serious about buying their first home in America.

Knighten, 38, was raised in the Chicago suburbs, and Cordier, 45, was raised in London but loved the idea of living in the Windy City after having visited with Knighten over the course of their relationship and two-year marriage.

"We knew we didn't necessarily want to move back straight away but more as a long-term investment and we could maybe retire there," Knighten tells CNBC Make It.

The couple lived in the UAE and had just under $40,000 saved.

Knighten and Cordier worked with a real estate agent in the U.S. to scout properties they saw online and started looking for mortgage lenders, too.

Their budget was between $260,000 and $270,000 for a multi-family home in the North Lawndale neighborhood of Chicago. In April 2024, North Lawndale home prices were up 26.6% compared to last year, selling for a median price of $307K, according to Redfin.

In 2019, while their agent worked in Chicago, the couple traveled to Lago d'Iseo, Italy, which they had fallen in love with during a European road trip the year before. Knighten says the pair had daydreamed about what it would be like to live there.

"We start looking up property costs to see if we could potentially afford it in the future," she says.

During that summer trip, the couple found a house they fell in love with. It was a two-bedroom that needed a new roof and upstairs floor but it was on the market for 25,000 euros or $27,144 USD.

"What we ended up seeing was that we could buy a house outright with the money we had saved for a down payment with a mortgage for a house in Chicago," Knighten says.

Meanwhile, getting a traditional mortgage in the U.S. was proving difficult for the couple since they were earning money abroad and didn't receive traditional US-issued income tax documents.

They decided the search for a house in Chicago was over and pursued the Italian property instead.

Knighten and Cordier had to wait about a year to officially close on their new Italy home.
Kristina Knighten
Knighten and Cordier had to wait about a year to officially close on their new Italy home.

"It felt too good to be true."

"It looked like a house you drew when you were a kid with the pitched roof, the door in the center, and the two windows upstairs," Knighten says. "It was really cute and just steps away from the train, steps away from the lake. It felt too good to be true."

But the seller's agent informed the two that there was already an offer in and the house was off the market. Knighten says that news was crushing because they knew it was the "perfect house" for them.

"Two days later, the agent called us and told us the buyers backed out and asked if we still wanted to see it," Knighten says. "We took a tour; we just loved it but knew that it was going to need a lot of work. We weren't scared by that because we knew we didn't want to move in right away."

Knighten and Cordier's offer of 23,000 euros or $24,973 was accepted by the seller, with the condition the couple could keep whatever was inside, but the closing could not happen until the summer of 2020.

The seller wanted to wait in an effort to avoid paying an inheritance tax since he had gotten the house after his sister, the original owner, passed away. His sister used the property as a vacation home and it had been in their family for years.

The couple agreed to the deal, put down a 500 euro good faith deposit, and waited patiently to become the new owners of the house.

Renovations are currently underway, including moving the kitchen upstairs to the second floor.
Kristina Knighten
Renovations are currently underway, including moving the kitchen upstairs to the second floor.

The COVID-19 pandemic prevented the couple from closing the deal in person, so they had a local friend in Italy act as their power of attorney and handle it for them.

When the couple finally traveled to Italy again in July 2021, almost an entire year after closing, they found the house "exactly how she left it when she left her last vacation."

"The beds were made, there were nightgowns still hanging in the armoire, and photos on the wall," Knighten says. "In some ways, it was kind of eerie because it felt like you're walking into someone's house, but it was also really beautiful because we felt like we're connected to the house and the history."

The couple salvaged as much of the previous owner's belongings as possible and worked with the seller to send back anything he wanted to keep, including old black-and-white family photos.

Now the real work has begun

Knighten and Cordier decided the first thing they needed to tackle was a new roof. The original estimate was just under $15,000 but that was in the summer of 2019. By the time the couple closed on the house, estimates for the roof had jumped up to $40,000, which was over budget for them.

The couple started renovations on the home in March of this year and are currently living in a two-bedroom apartment a few blocks away for 700 euros a month or $760 while the work gets done.

"We kept saving until we could afford to do any of the work," Knighten says.

In addition to the new roof, Knighten and Cordier are also planning on additional changes to the house, including moving the kitchen upstairs.

The two are planning for Cordier to do as much of the work himself as possible and are estimating about 100,000 euros or $108,578 in renovation costs.

Knighten and Cordier originally hoped that their house would be ready by the time their apartment lease is up, which is a few weeks from the time this article was published, but Knighten says that won't be the case.

"Worst case scenario in my head is we move in by Christmas. I'm hoping it is in September, but we will see what happens in the next few months and readjust our expectations."

For now, the couple is hoping that Cordier's sister closes on an apartment she's buying near their Italy home so they can camp out there for a bit.

"I'm feeling good about it. Something will work out," Knighten says. "All in all, it was worth taking the risk to do the thing that you think or know is going to make you really happy even if you're not sure how it's going to pan out in the end. That is probably bad advice but I'm so happy we did this."

Conversions to USD were done on May 22, 2024, using OANDA conversion rates of 1 euro to 1.08 USD. All amounts are rounded to the nearest dollar.

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