Buying at a low price does have a downside
Most buyers have a wish list of features they’d like to have in a home. Often missing from that list is how salable the home will be when they later decide to sell.
Generally, buyers deal indirectly with resale value. They want a home they can buy at market value or less. They want to buy a home that will retain its value. They want to buy a home that will suit their needs. They want to buy a home they can make their own.
A listing that’s priced low to sell fast may be one that will have good resale value only if you use this marketing strategy. The low price may offset an incurable defect, such as a location on a busy street.
There’s nothing wrong with buying a home on a busy street as long as (1) you buy it at a price that reflects the location issue; (2) it suits your long-term needs; and (3) you understand that you will probably have to discount the price accordingly when you sell, depending on the market at the time.
In a hot seller’s market, buyers are desperate to buy. They often overpay, and they are more likely to overlook defects that they would shun in a sour market.
Resale value has become a bigger issue since the housing recession began five years ago. Buyers are more cautious in their homebuying decisions. They don’t want to buy just any home; they don’t want to make a mistake and end up wanting to move in a slow market in which they might lose money.
The homes that hold their resale value well are the ones that appeal to a broad cross section of buyers; offer a good floor plan that works for different lifestyles; have a good amount of space but are not enormous and expensive to maintain; and exhibit a pride of ownership. They should also be in good condition.
Location is also a critical element of resale value…
Dian Hymer, a real estate broker with more than 30 years’ experience, is a nationally syndicated real estate columnist and author of “House Hunting: The Take-Along Workbook for Home Buyers” and “Starting Out, The Complete Home Buyer’s Guide.”
Read the rest of this article at Inman News here: “6 signs a home will hold its resale value“.