How to Spot a Good Buy in Your Next Home
Beauty is in the eye of the beholder, particularly when it comes to buying a home. Features that attract one home-buyer may repel another.
However, the one feature of interest to every home-buyer is price. Getting the most home for your money is paramount. The real problem is figuring out whether that fixer-upper on one street is a better buy than the home in next-to-new condition two blocks away. That’s why knowing what to look for before you buy can save you time, energy and money down the line.
The first step is figuring out what kind of house you need. A good buy is only a good buy if it meets your current and future living requirements. Before shopping for a home, decide how much space you and your family require. How many bedrooms, bathrooms? Is a family room necessary? Do you need a layout that will accommodate a lot of entertaining? Do you prefer a spacious or compact work space in the kitchen? If you have small children, can the house easily be childproofed?
Evaluate the front and back yards. Is there enough space to accommodate your children? Do you want a park-like or garden setting? Do you enjoy yard work and gardening, or do you want a low-maintenance yard? Take into consideration the cost of extensive landscaping and upkeep.
Next, determine how much work is required to make the house you are considering livable. Make an honest assessment of your fix-it abilities. How much work are you willing to do or pay someone else to do? Do you have basic decorating, carpentry and plumbing skills? If you plan to learn as you go, make sure you have accurately determined what you are getting into. Ask an experienced friend, family member or your real estate agent for their opinion, and be sure to consider how much remodeling inconvenience the rest of the family can handle.
Unless you are ready and able to tackle a major remodel, look for a house or condominium that needs only cosmetic improvements. These include painting, wallpapering and replacing items like flooring, window treatments, bathroom and kitchen fixtures, light fixtures, cabinet and interior door hardware and appliances. Remember that even these simple changes can be costly if you have to make many of them.
Beware of improvements that seem easy enough at first glance buy may turn into major headaches and require a lot of money once you’ve moved in. Remodeled kitchens and bathrooms, changes to the floor plan, room additions and redesigned landscaping are examples of seemingly minor changes that can easily eat away the money you thought you saved by selecting a so-called “bargain priced” home. Of course, you may be perfectly willing to spend whatever money is needed to customize the house to match your tastes and needs.
Make sure major systems in the house are in good working condition. The furnace, air-conditioning and plumbing should be up to date, since repairs can be costly. Your agent can arrange to have a professional inspector determine whether the electrical wiring and any room additions are to code. Local utilities often offer free or low-cost inspections to tell you if the house is energy-efficient.
Look for a house with universally popular selling points. If you’re impressed, the next buyer down the line is bound to be, too. For example, a roomy, modern east-to-clean kitchen is the best selling point a home can have. A house with only one bathroom is less desirable than a house with two or more. Many buyers expect at least three bedrooms, with a master bedroom that offers a feeling of privacy. Lots of storage space and closets, especially walk-in closets, will be a real selling point. Family rooms or “great rooms” also are desirable. On closer examination, a house that looks like a bargain may lack some of these key features.
Don’t forget the old adage: location, location, location. Unless you’re looking for a fixer-upper, the house should be in a condition that is comparable to other homes in the neighborhood. Avoid buying the biggest or fanciest home on the block. Consider the amount of traffic or noise. Homes located in a quiet area away from a busy street will command a higher price. Make sure the schools in your district have a reputation for quality education and safety. Nearby supermarkets, gas stations, restaurants and theaters also will make a location more desirable.
Good community facilities also add appeal; pools, athletic fields, community centers, libraries and hospitals all add to a neighborhood’s value and desirability. Transportation needs also should be considered. Is local public transit available? How long are typical commutes to places of current and potential employment? Are there several alternate routes? How close is a major airport? All of these can affect a home’s pricing.
Consider the cost of living in a home. It’s important to consider not only purchase price but the monthly cost of living in a home. Estimate your utility and maintenance costs. For example, will the house need to be painted on a regular basis and will you need to spend money maintaining a swimming pool? Ask your agent about the property tax rate and whether increases are anticipated. Will you have to pay special assessments for a homeowner’s association? Consider the point in the life cycle of major household systems, such as the furnace, air conditioning, roof and kitchen appliances.
You can find a bargain! Your first step should be to seek out a knowledgeable real estate agent with experience in the market areas where you wish to purchase a home. Your agent can help you locate those properties that truly are “bargains” and help find the home that most closely matches your desires and needs.
For more information on this subject or any of your real estate needs contact:
Robb Pickard
Broker/Co-Owner
RE/MAX of Cherry Creek
Direct: 303.331.4542
Or visit www.RobbPickard.com
Thanks to Rudi Braun, Century 21 agent in Sebring, FL for allowing me to modify this to my market.
How’s the Market? The simple answer…
The most common question that a Realtor hears is “how’s the market”. The answer is much more complicated than I can fully explain here but I’m going to try.
The media is full of doom and gloom; and to a certain extent, it’s on the mark. However, the reality in Denver is not entirely negative.
Real estate convention uses inventory statistics as a fundmental gauge of how the market is doing. Active inventory (the number of properties actively for sale at a point in time) divided by the number of sold properties for a given month equals how many months it would take to “clear” the inventory. Six months of inventory is considered a balanced market. Fewer than six months inventory equates to a “sellers” market and greater than six months is a “buyers” market. Fundamental supply and demand at its finest.
According to Dave Liniger, Co-Founder of RE/MAX International in a recent seminar, the national average inventory currently sits at about 10.5 months. Some markets, such as southern California, are seeing as much as 17 months of inventory. There’s no question that it’s a buyers market nationwide.
Denver has also moved to a buyers market (as if you didn’t know) however the Denver market is much closer to balance with 6.5 to 8.5 months of inventory. Well below national averages.
Being an engineer by education, I tend to favor looking at the numbers to find out the facts, so I ran some stats for myself today to verify. The overall Denver market is running 7.6 months of inventory for all residential units (single family homes, townhomes and condos). When you dig into specific areas of the city you find these numbers ranging from mid-6 to mid- 8 months.
So, how’s the Market? The simple answer is it really depends on your neighborhood. Don’t rely on national statistics because they simply won’t apply to your home. Don’t even rely on city statistics. You must look at a neighborhood level.
The best way for you to get a good answer to the magic question, “how’s the market”, as it applies to your circumstances is to call your Realtor and ask about your specific neighborhood. This is what I do…helping my clients make decisions that are good for them by providing information that impacts their decision making ability.
To get a look at current activity in your own neighborhood visit my website, register for your own personal HomeCard and enter specific search criteria that identifies your neighborhood including the Sub Area name.
