Buying Advice

Something more important than location?

by John Rice

Yeah yeah yeah.  We’ve all been told by real estate professionals for years that the single most important thing when picking a house is it’s location.  I’m telling you right now that there is something even more critical than that.

Let me tell you a few things about location first.  It’s subjective.  People pick where they want to live for lots of reasons:  Proximity to main roads, their job, schools, parks, low crime, etc.  It’s always a compromise too.  One buyer may be willing to be far from parks if their kid can be in a better rated school.  Another buyer may be willing to put up with a higher crime rate if it is super close to their job…..so, one person’s great location may not be as great to other buyers.  Also, locations are sort of price dependent.  What is considered a good location for somebody with a $100k budget will definitely be a bad location for a $400k buyer.

What do ALL buyers have in common though when picking a house?  They all want as good of a lot as they can get.  In all 15 years of my career, I have never had somebody say they wanted a house that backed to a busy road, had a steep driveway, lacked privacy or had a backyard that was unusable due to a slope.

Why is the lot so important?  For starters, it is often a buyers first impression.  If a buyer tries to pull in the driveway and their car scrapes the pavement, bad sign.  If they are out of breath before they get to the front door, bad sign.  If they step out of their car and can hear New Circle Road or the Interstate that is behind the house, bad sign.  Additionally, the lot affects just about anything you do with the property.

What should you look for in a lot?

  1.  As flat as possible is the biggest thing around here.  Lexington is pretty flat.  The severely sloping lot is unusual here.  Go to Richmond or parts of Scott County and it is more common.  For what’s it is worth, nobody has ever told me they didn’t like a house I showed them because the lot was too flat.
  2. A nice view is always a plus.  If you can’t get a good view, then no view at all is safe.  We don’t have a lot of greenspace views and even fewer water views in Lexington.  It is totally okay to just have a flat backyard that backs to other houses.  I would avoid backing to anything than other houses, such as businesses, apartments or a road…..and ideally it backs to houses that are equal or higher in value than the one you’re viewing.
  3.  Get a lot size and shape that is normal for the neighborhood.  If you are looking at a house that has a tiny or oddly shaped lot unlike any other in the neighborhood, don’t buy it.  The same doesn’t always apply for lots that are bigger.  Most of the time the biggest lot in the neighborhood is the most desirable unless it is in a neighborhood where the most likely buyer will be a retiree or somebody downsizing to get away from a lot of maintenance.
  4.  I would avoid a corner lot if possible.  There are a few buyers who prefer a corner lot but most people view them as twice as much sidewalk to deal with.  Plus, most neighborhoods only allow you to fence a corner lot from the rear edge of the house, meaning that you have much less space if you want to fence it in.  (I’ve got a good friend who looooves his corner lot and will likely find out I said this…..sorry Peter!)

Want to know my absolute favorite thing about getting a good lot?  It never needs updating and never goes out of style.

 

Buying in 2020? When to begin?

by John Rice

Right now.

I know, I know…..realtors always say it is a good time to buy, or a good time to sell, but hear me out.

There are two things I have consistently seen over my 15 year career:

  1.  All the buyers come out in mass in about March.  They fight for the best houses on the market.
  2.  When the market is good, prices always begin to creep up in the spring because that is sort of the opening season for the whole year.

If you are planning on buying under $200k this year, you will have a harder time finding a house later in the year when there will be multiple offers the first day on the market for the best ones.  You will have to do things like be flexible on when the seller moves out and possibly do the inspection type where you don’t ask for repairs, you either take it or walk away after the inspection.

Or, you could start now and avoid all of that while getting Fall 2019 prices.

Right now really is a good time to buy.

 

When is the best time to be a buyer or seller?

by John Rice

One of the first things I do every day is look at ALL the new listings, look at ALL the price reductions, look at ALL the new pending sales, and look at ALL of the new closed sales.

Want to know some things I have noticed over the years?

In the spring, the number of houses selling quickly is higher than any other time of year.  More buyers are out.  There are usually fewer listings early in spring since most sellers want those first few warm weekends to work on curb appeal.

In the summer, we start seeing more new listings.  Sales remain strong.  Overpriced houses get overlooked.

In the fall, we see fewer new listings.  The frenzy slows down.  There are fewer multiple offers and fewer houses sell the first day or two on the market.  In an appreciating market, I also see houses that have been on the market for a long time begin to sell.  Why does this happen?  They were the overpriced listings in the spring and summer.  With prices going up, they have appreciated into their list price and now are competitive with newer listings.  Also, in an appreciating market, most sellers get greedy.  They want what their house is worth PLUS $5-10k.  Yesterday’s overpriced listing looks really good to a buyer compared to a brand new overpriced listing.

In the winter there are far fewer new listings but this is the best time to be a buyer.  Most sellers have been beat into submission by the buyers of prior seasons and are the most realistic they will ever be.  For a seller, the benefit is that your competition is typically just the other listings that are left over from spring and summer.  You stand a better chance of catching a buyer.

So, when is the best time to be a seller or be a buyer?

If you are a picky buyer looking for something specific, spring and summer because you will have more choices.

If you are a buyer who isn’t too picky, then fall and winter may get you the best price.

If you are a seller with a house that has been a buyer’s second or third choice all spring and summer, then your best bet is the fall and winter.  The reason your house never made it to be somebody’s first choice was because there was always a new listing that lured the buyers away from your house.

If you are a seller with a nice house and are willing to price it appropriately, then you will sell quickly any time of the year.  Your house will always be somebody’s first choice.

Which builder would I pick?

by John Rice

Before I spill on which builder, let’s establish the criteria:  Priced between $200k and $400k and brand new.

Ok, you ready for it?

To keep me out of a lawsuit, lets just say it is the big one in town.  Four letters.  You know the one.

I can already feel the tension in the air.  It is because I get it all the time when people ask me who to use and I suggest this builder.

Sure, everybody in town knows somebody who knows somebody who knows somebody who has had a bad experience with this builder……but nobody ever knows “That” person first hand.  I own 3 of their houses myself and have sold 60 of them of all ages.

It has been my personal and professional experience that they build as good of a home as anybody.  Am I saying they are perfect?  No.  I am just saying that after selling new homes built by other builders and selling hundreds of “Used” homes built by other builders,  their homes seem to have fewer issues caused by the construction of the home.

Any house is something with thousands of pieces assembled by lots of different trades that has to withstand both time and mother nature.   Things go wrong with them.

I think one reason this builder has so many detractors is just because of their scale.  If you have build maybe 25,000 homes in the Bluegrass and 5% of those people had a bad experience, that is a lot of people.  If you are a smaller builder who has maybe built 100 homes in the Bluegrass, that same 5% complaint rate is only 5 people.

All I know is that if I were wanting a new home in the $200-400k range, I would rather go with a builder whose 50 year old houses are still standing verses somebody without much of a history.

Advice as we dig out of a housing shortage

by John Rice

I’m starting to see an interesting thing happen.

We all know that due to the lack of new construction for many years, we have a shortage of houses for sale.

Many people have said the way to solve this is to build our way out of it.

I am starting to see this happen.

In Nicholasville between $200k and $250k, 17 of the 30 houses for sale are new.  In Lexington’s 40509 zip code, there are 104 houses for sale between $300k and $500k.  48 of them are new.  That’s an incredible amount of houses for sale in the Hamburg part of Lexington.  No wonder sales are slowing way down in that price range and I am seeing $10k price reductions left and right.

So what does this do to sales of existing houses?

Most people who buy a new house are only looking at new or newer houses.  If you live in an older existing neighborhood, you are probably in good shape.  Few buyers will seriously consider a 20+ year old house on a bigger lot with mature trees AND a brand new one on a smaller lot with trees shorter than they are.  If you have a house that is less than about 10 years old in this price range, well, you may have a hard time competing with brand new houses.

Any time I have a buyer wanting a newer house in an area with a lot of new construction around them, I always tell them that it might be hard to sell and/or might not appreciate that much until the last new house has sold.  The longer they plan to be there, the better.  If they tell me they may only be there for 2-3 years, I tell them it might be wise to pick another house.

If you are buying in an area with lots of new homes around you, try to pick one that has some unique feature or has a super good lot.  In a neighborhood where most homes aren’t too much different from each other, these small things are the difference between your house selling and always being a buyer’s second choice house.