Protect Yourself When Buying in a Lousy Market

Let’s face it.  The market sucks right now.  I think I may be the only agent to come out and say this, but it is the truth.  I’m not a sugar coater.  I am a realist rather than an optimist.  I optimistically hope that values aren’t going to dip in the near future, but since most loan officers I know have been twiddling their thumbs recently, the realist in me says it is a false hope.

So, what is a buyer in and around Lexington Ky going to do?  You’ve got to make some wise choices to protect yourself from the risk.  Not every neighborhood has taken a beating.  Some are safer than others.  Real estate is all about location, price, and condition.  If you keep those 3 things in mind, you’ll be okay.

Unless you are getting a house for below market value, here are some things to keep in mind for when it comes time to resale:

1)  Don’t buy a house with a steep driveway.  Most buyers rule it out before even getting to the front door.

2)  Don’t buy a house that backs up to anything other than similar houses or better.  The people in a million dollar house don’t want to sit on their deck and see a half million dollar house.  The half million dollar folk don’t want to sit on their deck and see the $250k house.  The $250k people…..well, I’m sure you get it.

3)  Don’t buy on a busy road.

4)  If it is in a neighborhood where the target buyer is going to have kids, get the best, most well-rounded district you can.  I know of several neighborhoods in Lexington whose values were much higher when people often had to settle for their second choice in a hot market.  Now that most people can get their first choice neighborhood, those areas took a beating.

5)  Stick with things that people won’t consider random.  Like an odd-shaped lot, a weird floor plan, etc.

6)  Too new of a neighborhood.  Often, a nice area will decline once the original people start moving out.  Happens ALL the time.  Another problem with a newer area is that often, people all move out around the same time.  There is a newer neighborhood out Richmond Road where it seems like half of the houses are currently for sale.  Another issue with newer areas built during the “Anything goes” mortgage days is that many sellers paid top top dollar for all their upgrades and now owe more than they are worth.  There is a neighborhood in SW Lexington where it seems most of the houses are short sales.  That is going to bring down the value pretty fast.

I could really go on and on with this list.  But since most of it has been covered in past posts, I’ll skip it.

Basically, when you’re looking at houses, pretend you have 10 friends with you.  If 8 or more of them couldn’t find too much bad to say about the place, then you have a property that should be easy to sell and hold its value better than most.  It’s about supply and demand, so make sure you buy a house that will be in demand……I’ve only had one client who has sold their house for less than they paid for it since the market turned like potato salad that’s been left out too long. 

These are the things I do when it is my own money!

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