The Real Story …
News and commentary about the real estate market and related topics.
Dave Parrish, ABR ®, CRSA, CSP, GRI, ePRO ®, REALTOR ®, RealtySouth
The opinions expressed here are my own and don’t necessarily represent those of HomeServices South.
New or used (uuhm, I mean previously owned)… Part 2
We ended our conversation… last week in a discussion about the decision to buy a new versus “previously owned” home.…
Facts established last week were:
· New Homes are in short supply (shortest supply in recent history)
· That supply is unlikely to improve significantly in the near term
· This short supply tends to cause the prices of new homes to be increasing/rising
· A majority of Buyers would prefer to purchase a new home for any number of reasons including: the desire to have a life… a home not in need of a lot of work that almost guarantees I can’t spend my weekends doing what I want. New Roof, New HVAC (Heating & air conditioning systems), new appliances… the desire for all the latest features, amenities, and colors … a home that looks and feels like the times! The desire for a clean home not filled with the odors and reminders of past occupants and their imperfections.
Now in previous conversations, I have pointed out that while there is a large inventory of homes on the market, there is not a large inventory of high quality homes. By high quality, I mean homes that fit the criteria that most buyers are looking for (see list above). That said, there are more re-sale/existing homes meeting this criteria than there are new homes currently on the market. Generally, the cost for re-sale homes with the similar amenities, features and location will be less than that of a “new” property.
Now all I’ve done so far is to communicate the market conditions that exist today… How do you use this information to make the best buying decision for your particular situation?
First be aware of your level of tolerance for involvement in home repairs and home improvement projects either as the performer of those tasks or the manager of those tasks. You need to make an honest assessment here and understand the realm of possibilities. Many buyers in today’s market think changing wall color (painting a room or rooms) is a big deal. Others are much more energetic when considering much larger projects, replacing windows, doing upgrades of kitchens and baths in stride. Do you have hobbies or other passions that will rule-out your involvement in such projects?
Secondly, take a moment to think about what’s coming up in your future… are you likely to remain in this home for less than 7 years, less than 5 years, Less than 3 years? The shorter the time period, the more you should consider the total investment made in the home to make it livable while there and marketable when time to move on… because the shorter that time period the less likely you are to re-coup that investment. If considering a new home, will you have to compete with the home builder when it comes time to sell (will there be new homes on the market which you must compete with in the same neighborhood)? If looking at the purchase of an existing home (“Previously Owned”), what are the short-term, mid-term and long term prospects for the subject community?
The right decision is as individual as is the home buyer. You need an experienced advisor to represent your interests as you consider this important decision. Seek out qualified expertise in the form a Realtor® trained expressly in Buyer Representation and take the time with that advisor not just to look at properties but to define your goals, your constraints, your time frames and how to make the decision that best serves those interests.
