Obtaining Good Value When Buying a Home

By
Real Estate Agent with GreatWest Realty DRE# 00827565

 

 

When you buy and what you buy can make a big difference in terms of your prospects for appreciation.  It is important to do your homework and research before you buy.

Buy into an area of employment strength.  Of course, in this era of corporate volatility, it's not easy to guess which companies will remain stable and which will grow.  Rising unemployment nearly always lowers property values.

Want a good barometer of a community's economic vitality?  Look at how well brand-new homes are selling in the area.  A community able to absorb a large amount of new housing stock usually has a growing economic base. 

You can obtain statistics on local new home sales through a good real estate agent.

Eyeball a neighborhood in terms of upkeep.  A neighborhood that's not well maintained will depreciate.  If a drive through a community reveals the presence of junk cars, poorly kept yards and unkept houses, it's reasonable to fear that values there will decline.

Unfortunately, poor maintenance is contagious.  When one neighbor lets his yard go, the other says, "Why should I bother to keep up my yard?"

Think specific schools, not just school districts.  People are becoming a lot more aware of education. 

It used to be that homebuyers with children were satisfied to buy into a general district known for "good schools."  But these days, increasingly, they focus on a particular school within a district.

Buying a home in the neighborhood by a "crème de la crème" public school could be a safer bet in terms of the stability of property values than buying within an area where schools are generally considered good.

But buy close enough to the prized school that you won't likely lose access to it if school boundary lines are redrawn.

Seek to buy one of the least expensive houses in a splendid neighborhood.  If your home is the vine-covered cottage surrounded by large chalets, you can expect the neighboring homes to pull up the value of your cottage.  But buy the grandest chalet on the mountainside and you can expect the more modest homes there to hold down its value.

Buy the cheapest home in the best neighborhood is one widely known ideal that continues to prove true, time and again.

Buy a house not dressed in its Sunday best.  One way to get a great value in a prime neighborhood is to buy a house with cosmetic or other superficial problems.

Houses that are messy and not all fixed up are often the best buys.

Because homes with cosmetic problems are a turnoff to most buyers, who can't see through the mess to the potential, they typically go at a discount of 10 percent to 15 percent off similar properties in tip-top condition.

And a few inexpensive improvements, such as a thorough cleaning and a new coat of paint, can result in a big change for very little cash.

Get a "market analysis" before you commit to a particular purchase.  It's long been common for real estate agents to provide neighborhood market information to their home-selling clients.  A "market analysis" compares a house to similar homes nearby that are on the market and can help spot an upward or downward trend in values.  Smart sellers have traditionally relied on market analysis data to set the right price for their homes.  Buyers can also have their agents tap those same statistics to be sure they get a good deal.

Buying a home dispassionately - The more carefully and rationally you make your home selection today, the better your chances of doing well when you sell your home in the future.

To be calculating is merely self-preservation. 

If you have questions as a homebuyer, and I can be of assistance, please feel free to contact me!

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Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. Ellie McIntire 12/15/2010 09:47 PM
  2. Kate Elim 12/15/2010 09:49 PM
  3. Gabe Sanders 12/27/2010 06:35 PM
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Show All Comments
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

So true, Elizabeth!  Even when I bought my present house in 1983, I kept it rational until near the end of negotiations.  And then I took the whole thing personally. . .I'm in the business, and should know better:-)

Dec 15, 2010 09:35 PM #2
Ambassador
1,075,284
Ellie McIntire
Ellicott City Clarksville Howard County Maryland Real Estate - Ellicott City, MD
CDPE, Howard County Homes for Sale

Myrl- what a great post. Buying a house is an investment and these factors should always be considered.

Dec 15, 2010 09:35 PM #3
Rainmaker
1,417,202
Rebecca Gaujot, Realtor®
Coldwell Banker Stuart & Watts Real Estate - Lewisburg, WV
Lewisburg WV Real Estate, Greenbrier County

Myrl, I agree with Ellie..great post, and have suggested...

Dec 15, 2010 10:02 PM #4
Rainmaker
1,018,525
Nick T Pappas
Assoc. Broker/Broker ABR, SFR, e-Pro, @Homes Realty Group, Huntsville AL - Huntsville, AL
Madison & Huntsville Alabama Real Estate Resource

Myrl, all excellent points and tough to put one at the top of the list, but getting specific with schools and buying the least expensive in the best neighborhood are close.

Dec 15, 2010 10:46 PM #5
Ambassador
1,550,359
Gary Woltal
Keller Williams Realty - Flower Mound, TX
Assoc. Broker Realtor SFR Dallas Ft. Worth

Myrl, they say we buy with emotion and justify with logic. Don't ever let the logic slip away and pay way too much for a house. You have to be able to walk away from some purchases with stubborn high priced sellers. Great review of value.

Dec 16, 2010 12:31 AM #6
Ambassador
1,278,570
Toni Weidman
Re/Max Sunset Realty - Trinity, FL
23 Years Selling Homes in New Port Richey, FL

This is all great advise, Myrl. But, usually, it comes down to the one they fall in love with (even if we can see that there is a better one).

Dec 16, 2010 08:12 AM #7
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Ellie - It certainly is a list that will hopefully provide a guide.  I hope you are enjoying your week!

Dec 16, 2010 12:02 PM #8
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Rebecca - Thanks for the "suggest". . .It is greatly appreciated!  I hope you are staying warm in West Virginia.

Dec 16, 2010 12:03 PM #9
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Nick - Schools are so important to not only families, but to those hoping for resale value when they need to sell at some point in the future.

Dec 16, 2010 12:04 PM #10
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Gary - So true!  When I dealt on my own house, I was the one that had gotten "overly" emotional.  It became more about getting a killer deal, than a great house at a good price.  I almost walked away from a great deal, while trying to get a greater one.  Buyers nead to be cognizant of that as well.

Dec 16, 2010 12:07 PM #11
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Toni - Fortunately, a lot of buyers fall in love with houses that are often a good deal as well.  There can be a marriage of those two concepts.  Thank goodness for that!

Dec 16, 2010 12:08 PM #12
Rainmaker
482,245
René Fabre
First American Title - Seattle, WA
New Media Marketing

Myrl: Great advice... I got a couple of them right! ;o) The house I would love to have again was a little bit of a diamond in the rough, and I wanted that neighborhood precisely for the schools. Best decision I ever made.

Dec 16, 2010 05:50 PM #13
Rainmaker
269,226
Jack Mossman - The Nines Team in Stockton
The Nines Team At Keller Williams - Stockton, CA
The Nines Team at Keller Williams

Myrl - I'm not sure how I missed this post ... but I'm so glad I was rechecking my "subscribed to" list.  Great content - and I'm surprised it hasn't been featured!

Dec 16, 2010 06:24 PM #14
Rainmaker
622,517
Sandy Shores Broker, Melbourne Real Estate
M & M Realty of Brevard Inc. - Melbourne, FL
Brevard County FL Real Estate

Myrl, All excellent tips in shopping for the "perfect" home. Reminding buyers that houses that are messy are often the best buys is a super tip. I have a buyer closing on one of those "diamonds in the rough" tomorrow.

 

 

 

Dec 16, 2010 08:12 PM #15
Rainmaker
525,875
Robert Hammerstein
Keller Williams Valley Realty - Hillsdale, NJ
Bergen County NJ Real Estate

Myrl - Well thought out post. I too suggested.... All excellent tips and hope some buyers out there actually get to read this....

Dec 17, 2010 04:29 PM #16
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Rene' - I think schools play such an important role in a community.  Even if a homeowner doesn't have children, the resale of their home is still affected by the quality of schools.

Dec 17, 2010 05:54 PM #17
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Jack - I'm glad you like it!  And, you didn't miss it by much.  I think I only posted it a couple days ago:-)  I hope you have a great weekend!

Dec 17, 2010 05:56 PM #19
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Sandy - I'm feeling a little schizophrenic.  I wrote the blog for sellers within a day of this one.  It mentions home staging for obtaining better value:-)  But yes, it depends on your perspective (buyer or seller), which will work best for acquiring best value.

Dec 17, 2010 05:58 PM #20
Rainmaker
1,159,808
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Robert - Thank you for the "suggest."  It is greatly apprecaited.  And thank you for your kind words as well.  I hope you have a wonderful weekend.

Dec 17, 2010 05:59 PM #21
Ambassador
1,741,244
Barbara-Jo Roberts Berberi & Corinna Birgit Cromartie
Charles Rutenberg Realty - Palm Harbor, FL
Palm Harbor & Dunedin FL Residential Real Estate

Myrl - as a former educator, I have to say that there is nothing more important than checking on specific schools. When I moved into Pinellas County years ago and my own two were still in middle school, I went to great lengths to check on the best middle and high schools in the area. Then I purchased in THAT specific area. Nothing is more important than an excellent school! Our kids are our future!

Dec 18, 2010 04:34 PM #22
Show All Comments
Rainmaker
1,159,808

Myrl Jeffcoat

Greater Sacramento Real Estate Agent
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