Two Big Choices Facing Most Home Buyers

Unless you have unlimited resources there are two distinct choices you will be facing when buying a home. These choices are , in most cases never really articulated.  Most home buyers eventually arrive at this realization but coming to it sooner will save a great deal of time and frustration.

A group of  us at Red Oak Realty were discussing recently ways that we could help our clients in the home buying process.  One of the things we talked about were the decisions facing home buyers as they move through the process. Of these decisions perhaps the two biggest are as follows.
TIME/ MONEY
and
LOCATION/ CONDITION
Most of us will have to choose one from each group.   This is a forced choice.  Which in each group is more important?  Choose either Time or Money.  Then choose Location or Condition.

Lets look at the first choice.  We have a budget.  We can save money by buying a short sale, fixer or REO (bank owned foreclosure), but these take more time.  Or we can save time by purchasing a conventional sale in a home that is remodeled and move in ready. There are lots of variations to this equation. But the idea is simple:  Choose which is more important.

The second choice is not as obvious to most buyers.  Lets face it, how many times in our lives do we buy a home?  If location is most important to you then you will notice that the 'desirable' locations tend to be more expensive so you end up getting less house for your money.  Whereas you may be able to get everything you want in a house in a less desirable neighborhood.  Somewhere on this continuum the right home awaits you.

I recommend that the Home Buyer includes these decisions in their home buying strategy.  Sit down with your realtor and use these to come up with a plan that quickly focuses your home search and brings you to the home that most closely matches your needs.

As usual, let me know if I can help.

In Defense of Home Ownership

Of course you would expect a realtor to be in favor of home ownership.  Afterall, if nobody bought homes any more we'd only have landlords for clients!  A brief overview of world cultures will show that from the beginning of time in most cultures land ownership was considered the main measurement of wealth.  Of course, on top of that livestock and crops played an important part as well.  But people always need a place to live.  And in areas such as ours when land is scarce it is hard to imagine that property values will stay depressed for too long.  I know there is a buzz right now about "the end of home ownership being a pathway to wealth" about the end of the American Dream.  Well, I don't believe it for a minute. There is a reason why property is called real estate.  It is the only investment that has historically apreciated in value and that you can live in, grow food, raise animals and in many other ways meet some of life's basic needs.

Now I don't believe home ownership is for everyone.  For many individuals, at certain times, renting makes more sense. There are many factors to consider when making a decision as big as buying a home.  I think it remains the American Dream, and the dream of most people living on our beautiful blue planet.  There is something special about having a spot that you can call your own .  I can't imagine that this special relationship between the human being and the land he holds stewardship to will ever end.

There are two articles for further reading. Click Here for NY TIMES (In Defense of Home Ownership) and Click Here for Time Magazine Article (The Case Against Home Ownership)

Today's Real Estate Markets

I think its important for Buyers and Sellers to understand that when we talk about the "market" we are actually talking about many different markets. Just as in the BayArea there are many different eco-systems and climate zones there are also many different markets. With the changes in Housing over the past few years there have emerged some very distinct market areas.

Even if we're talking about REO's (foreclosures), the market in East Oakland is similar yet different from West Oakland, and quite different from Montclaire. And the market in Antioch, Richmond, El Sobrante and Berkeley are quite different from each other as well. Then we have the high end market, short sales, condos, lofts, first time buyers, and the list goes on with each area having its own specific personality and quirks. For example, right now in Berkeley the inventory for good homes is very low and there are only a few foreclosures which means multiple offers on any decently priced property, while at the very same time, in East Oakland there are many foreclosed properties available for sale which tend to keep values depressed. The point of all this is that if you are thinking about buying or sellling a property it is probably a good idea to consult with someone who is in the field everyday and who knows the particular market appropriate to you. Each market is a changing, fluid entity and there is some cross over between or among markets. If you read about it in the newspaper or hear about it on the radio it is probably not what is happening in the market place today. a good realtor is ahead of the news because s/he is in the field everyday looking at homes and watching the dynamics of the marketplace.