Key Things to Consider When Buying Your Next Home
By Wayne Chaulk
In my last article I covered off several key considerations you should give attention to when listing your property in our more challenging market environment. In this article I am looking at it from a buyer’s perspective. Many of these buyer’s considerations are critically important in our slower market environment (which is more of a buyer’s market) but in fact most apply in any market environment in terms of one being more prudent as a buyer of real estate anytime. Also, most if these ideas apply to both city and country homes to a large degree.
Avoid Overpaying for Your Purchase
- Know local pricing and area trends (a good realtor is invaluable here is helping you understand what is truly happening rather than following media content which can be sometimes inaccurate or sensational, headliner type news or listening to well meaning friends).
- Don`t get carried away in a multiple offer situation and let emotions trump practical thinking over a property you may overpay for because you what it regardless.
- Be cautious when buying the “best or biggest” on the block (see further comments on this below).
- Don`t be afraid to walk away from a deal. There is always another to be had or you may be able to re visit the same property once emotions settle among parties to a stressful negotiation process that has broken down.
Choosing Real Estate Wisely
(Neighbourhood considerations and signs that an area is improving and desirable)
- Construction dumpsters in the area or community reflecting renovation work happening, particularly on older homes.
- Well kept yards, vegetation, fences, home exteriors with tidy surroundings and minimal to no debris or excess items or junk on area/community properties.
- Several “sold or c/s” signs currently or recently in the area versus stagnant listings reflecting demand.
- Good eating and shopping options close by or in the community.
- New public facilities being built in the area once again reflecting community support.
The Best/biggest isn’t always the Best
If you buy the best or biggest home on the block, you may also be buying the poor investment (certainly when times get tougher the biggest or best isn’t in as high demand).
- It’s the biggest on the block. The principle of conformity (appraisal term) holds that a house is more likely to appreciate in value if it’s closer in size to the other homes in the neighborhood.
- It’s the most expensive. The principle of regression holds that the value of ‘higher end’ real estate can be brought down by its proximity to too many lower-end properties.
- It’s over-improved. Both principles noted above apply when a home has improvements out of line with others.
Look for Good, Buyer Friendly Floor plans
Good floor plans are easier to live with and they have much better resale value.
- Well-designed kitchen space. A kitchen doesn’t have to be super large, but should have ample counter space, plenty of storage, good lighting, bright windows and plenty of up to date code approved outlets. An island is a bonus.
- Well-placed stairways. Access to other floors should be from stairs placed near the entry or centrally located.
- Flex room. This is a room that can be a guestroom, office or den and is an example of a usage flexibility that adds to resale value. Also bonus rooms are in demand.
- The standard three bedrooms and at least two 3 piece/4-piece bathroom count on the upper floors is still one of the most re-saleable combinations certainly in the entry market. Of course there is room for variations with our trendy home designs but one bedroom on the main can be challenging for resale at times.
- Spacious garages are always a winner particularly if they can also handle pick up trucks.
Beware of Daunting Defects
- Bad foundation. It may need major, expensive structural repairs. Consider walking away unless you can negotiate a price concession.
- Worn out roof. You`ll likely have to replace it. If the seller won`t do it, again renegotiate the price.
- Outdated wiring. This is common in older homes and can be dangerous and very expensive to rectify.
- Damaged shower pan or water penetration in bathroom areas. If there`s water damage beneath a shower or tub, it can be unwieldy to correct with hidden drywall damage and leakage damage to sub floors hidden under flooring. Get an estimate from an independent contractor in this case before completing a deal. Write a condition in any offer in this regard to have satisfactory analysis.
- For acreages – Soggy ground around a septic field! The septic system may need attention such as blocked field piping, floats or pumps near their end with inefficient operation of the system. Very low flow from taps and water odors. Lots of surface stains on plumbing or in utility room on tanks etc. The water well may be pumping at a very low rate or water quality may be deteriorating piping or water systems. Once again writing conditions in any offer to review these systems so proper inspections will highlight system conditions and potential problems.
Also, if you buy a property because you love many things about it but it does have a significant negative of some sort that you can live with yourself, ensure that over time while living there that you do address that negative feature if at all possible so that some day when you go to sell you will have corrected it. Some examples: Change a Jack and Jill bathroom off a master to an en suite bathroom as most people want private en suites off their master. Expand a tiny mudroom to make it more spacious if you can by pushing out into the garage or sacrifice another area around the small mud room to expand it. Turn 2 small bedrooms into a larger bedroom. If your basement is a ‘home jobby’ and looks that way get it professionally updated. There are so many cases of nice homes with inferior basements being a real challenge to sell at market value.