As published on REALTOR.com on December 4, 2009
According to a national survey commissioned by Move.com, one in six (15.4 percent) home buyers are considering saving up to buy a new home within the coming year. The Ask a REALTOR® team shines a light on what new buyers can expect.
What extreme measures should a buyer be willing to take in order to buy a home in 2010?
David Kres: “Many real estate practitioners expect the market to heat up in 2010. I would advise buyers to really know their market. All seasoned property investors have a razor sharp focus on what they are looking for and are always in a position to seize on a property right away. This goes for experienced homebuyers as well. So if the market really takes off, I would advise all buyers to know exactly what they want and be ready to move on in when they see it.”
Maya Paveza: “Price your house properly and aggressively! It doesn’t sound extreme, but it is for most sellers. Price is the key, and be prepared to offer a sellers assistance. Distance yourself emotionally from your house. Being attached won’t help you sell it, only keep it.”
15.7 percent of buyers are looking for investment properties. What advice do you have for these buyers?
Tim McBrayer: “It depends on the type of investment property you are talking about. If investors are looking for positive cash flows from rental properties, then unless you have enough funds to be able to pay cash for the property, you probably are not going to find yourself in a positive cash flow situation. So, just be careful about figuring out what all of your costs are and what your net revenue really is. Keep in mind that you have principle, interest, insurance, taxes, upkeep and possibly HOA dues that your rental income should cover as much as possible.
It will ultimately come down to what risk tolerance the investor has and the funds available to reduce the carrying costs to a minimum so that a net positive cash flow can be achieved. If you are talking about investing for resale, then it comes down to doing your research to see if you can invest in repairs and upgrades and still make a reasonable profit in today’s market against today’s competition.”
45.1 percent say starting a home improvement is a number one New Year’s resolution in 2010. What home improvements do you think will bring the best value?
Hank Miller: “I consider the best value to be quality basement finishing. If it adds appeal, utility and flexibility then it’s a good value. In our area I also see outdoor living areas (nice hardscapes, BBQ’s) as attracting buyers. Of course kitchens remain popular.”
9.1 percent say fixing their credit so they can buy a home next year is their number one New Year’s Resolution related to real estate in 2010. What other real estate resolutions have you heard for the New Year?
Maya Paveza: “To refinance their homes, to catch up on bills, to move-up and take advantage of the tax credit and the high-end market conditions being a little weaker.”
Ian MacMillan: “The resolution that I hear from homebuyers most often is: ‘I’m going to wait for the bottom of the market and then buy a home in 2010.’ When I hear this, I offer the same advice I’ve always given: the right time to buy is when you can comfortably and sustainably afford the monthly payments for a home that meets the needs of this particular phase of your life. Period. If this is possible in the current market, why wait for some mythical event in the future? I think if we’ve learned anything from this real estate downturn, it is that people who try to time their real estate purchases based on the state of the market instead of the state of their finances always lose in the long run.”
