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.
Three Things…
When I purchased my first home… way back in the day (1970)…I was instructed by many experienced and trusted teachers/advisors that the three most important things in real estate are: Location, Location and Location.
While I still hold on to this instruction with almost religious fervor, I have developed some other insights as well. Those include the following:
· When looking to purchase property with an eye to its future performance as an investment Location is a must consider factor, but not the only factor.
· What you have invested in or owe on a property, has no relationship to the property’s value. Value is dictated by what the market is willing to bear. That is based on what similar properties (evaluated on location, condition, and amenities) are currently selling for.
· The condition of a home dictated by regular attention to its maintenance is the single most important item a home owner can do to maintain value and demand the best price the market is willing to pay.
· Every home is a move-up for someone.
· Every property will sell at the right price… I almost agree with this… however, I have actually seen properties that belie this truth… I’ve seen properties you would have to pay me to take! Properties where the “improvements” are uninhabitable and non-rehabable… Where the cost to remove exceeds the value of the land.
So that’s more than the three things alluded to in the title…What’s up!
The observations above lead me to believe that the three most important things in today’s real estate market are: Price, Price, and Price! Hey don’t shoot me… I’m just the piano player!
Human nature being what it is, I don’t know why I am so consistently shocked when I see contradictory behaviors in people (myself included). Who among us isn’t in search of a deal? Do you research items you are considering purchasing on the internet? You want to know which ones have the best reviews, how they perform, what the competitive prices are for this product versus that product… Seems we can all get very analytical when making a purchase. Ever used eBay, PriceGraber.com, Hotels.com, HotWire.com… Ever shopped at Best Buys, looked at the Blue Book value of an automobile? And yet, when we go to sell those very same products, we want to forget that such tools and techniques are used by those to whom we hope to sell.
No matter how high the quality of the product, nobody wants to pay too much! What’s too much? More than the market demands, more than your best friend (or worst enemy) paid… We may have different ways of determining what is too much; but, make no doubt about it, we are always reviewing those decisions… patting ourselves on the back when we our choices are proved “smart” and, more often than not, avoiding admission to others when we paid too much!
And so it is with the purchase or sell of a home. Homes are commodities when we purchase or sell. Granted we live in them, raise families in them and to some we may even define ourselves by them; but, they are no less commodities than the automobiles we drive or the toasters we use in the morning. Given a decent marketing plan, if a home won’t sell, it’s because it’s priced too high for what it offers the market… that is the same thing is for sell down the street for less! No marketing plan will sell a home that is over-priced!
So while I’ll never forget the importance of location in the value of real estate, it’s Price, Price and Price that are the most important things in real estate! Never doubt that it’s a price war! Want a better price… then pay attention to location when you purchase and to maintenance of the home after the purchase. May the market be with you!
