I can’t count how many houses I have been in over the past 15 years. Old, new, affordable, expensive and just about every neighborhood in the Bluegrass. Seen it.
One of my favorite things to do is watch how buyers react to several things, one of the biggest is the floor plan.
I think we don’t discuss the floor plan of houses often enough. Sure, we think about whether it is open or traditional but there is more to it than that. We usually just focus on the square footage. For example, I will often have buyers get excited about a small house because it has a basement. They will be excited because it is 2400 square feet. Having shown several of these over the years, I like to remind buyers that yes, 2400 square feet is a lot of space, but that house is really a small starter home sitting on a finished basement. 1200 up and 1200 down. The upstairs will always live like a starter home. I tell them this because just about every buyer I’ve known has lost their enthusiasm once they see a house like this.
Floor plans can greatly affect the value in older neighborhoods like Chevy Chase or Kenwick. I have seen far too many houses that sold for far less than similar sized houses that were finished equally. When I go to list an older house, the first thing I do is assess the floor plan. If it has lots of tiny rooms and much of the square footage is wasted in hallways, then I know it will sell for the lower end of the range for the neighborhood. A lot of older houses must have been designed by builders or the first owner on a napkin. You sometimes see some pretty odd things. You also see some odd things done during remodels. My parents house in Kenwick was built as a one bathroom house like pretty much all houses in the 1930s. Somebody at some point thought adding a half bath in an upstairs hall closet was a good idea. Since I lived upstairs, I can say that it was a good idea but it was very tight and very odd. This was before you could go to IKEA and buy those super small sinks. I just remember sucking in my gut to get past the sink.
Even in newer houses there are a few things that buyers seem to not like. I’ve shown some newer small ranch houses that have the living space on the back of the house. You have to walk down a hall and literally find the living room, which doesn’t make a good first impression. I have never sold one of these because a buyer just can’t get past that first impression, similar to split foyer houses where you have to decide immediately whether you are going up or down. Buyers don’t like anxiety as soon as they open the door. Also, a lot of the diagonal walls and plant shelves of the 1990s haven’t aged well. They usually make a room feel small, furniture placement odd and make people feel like they are in an interactive M.C. Escher display.
Another big negative is with houses that have a finished basement. Most people want to use this space for kids to play or for large gatherings of people. Lots of small rooms is a big negative. A lot of times, these basements got finished to suit the needs of the owner, which may not be the same needs as the next potential owner. When I have a client who will be finishing a basement, I ALWAYS tell them to have one big open room and to not make a maze of walls. Just like those ranches with the hallway leading from the front of the house to the back, buyers want to walk down into the basement and see that big open room immediately. They don’t want to get to the bottom of the stairs, turn and walk down a hall that leads to another hall or a small room that you must go through before getting to the main room. It is best to mimic the upstairs floor plan, only make it more open. You can put a spare bedroom under the dining room and a bathroom under the kitchen usually. Be sure to leave a little space for storage too.
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?
- 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.
- 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.
- 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.
- 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.
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:
- All the buyers come out in mass in about March. They fight for the best houses on the market.
- 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.
Just gonna jump right into this:
Gen Z will have a harder time getting a house than the Millennials did. They are the biggest generation ever. They will be entering the real estate market at about the time Millennials are selling their starter homes. Great news if you own a 1300 square foot house in Masterson. Times will be tough for them, but they will keep the market going strong. Every seller of a starter home needs a first time buyer so they can move up. That first time buyer is the oil that lubricates the whole market.
The Millennials will be moving up to their 4 bedroom houses on a cul de sac in a good school district because that is just a natural progression once you start a family. This is great news for Gen X sellers who will be downsizing to medium sized houses in upscale neighborhoods.
What makes me think all this? It’s not really crystal ball as much as it is history. Everything I just described happens with every generation. You buy a smaller house you eventually outgrow, you move up at least once to the house you raise your family in, then you downsize.
So what does all this look like for Lexington? More gentrification as it becomes expensive to live anywhere in Fayette County. I know it sounds unheard of, but the neighborhoods that nobody wants to live in like Cardinal Valley and Winburn may become the budget choice as similar neighborhoods with better locations become too expensive. I know it sounds crazy, but when I was in high school, people didn’t want to live in Kenwick and now those houses equal Chevy Chase for price per square foot……yesterday’s bad neighborhood can easily become a tomorrow’s good location. Plus, it isn’t like we are ever going to see brand new starter homes ever again. All that can be done is update/remodel existing houses. The people that flip houses need some margin to do this so they will buy distressed houses in whatever neighborhoods are affordable, just like they are doing now in downtown, Melrose, The Meadows and all those streets that begin with D around Pasta Garage.
Before long, I don’t think there will be any new construction in Lexington. We are already filling in every spot big enough to stick a short row of townhouses. This means that being in Fayette County will be even more expensive, and people will go to surrounding towns like Nicholasville and Georgetown even more. One day, people will discover that Winchester is only 15 minutes from Hamburg and the interstate passes right through it. I’ve never understood why more people don’t move to Winchester?
Remodeling will be hot too. With not much new construction, people will start remodeling existing houses more and more.
Sort of some majorly huge economic melt down, I think housing is going to be strong for quite some time.
It happens a lot with sellers.
They have a house that isn’t getting much attention from buyers. It could be due to price, an odd feature of the house, the time of year, competition from new construction, or anything really. They get a lot of showings and all of the feedback is the same, resulting in no offers.
Then all of the sudden they start getting more and more showings. Buyers seem more interested in the house than they have been, but still no offers.
The seller finds this time exciting. They are thinking “Wow, with all these new showings and better feedback, surely my house is about to sell!!!!!
Sellers assume this will last forever but it is a temporary thing. It lasts until other sellers with better houses put their homes on the market.
And here is the lesson to be learned: The market changes every time a house sells and every time there is a new listing. Once the best house in it’s price range sells, it makes every other house look just a little bit better. That is why your house that hasn’t been that interesting to buyers is all the sudden on their radar. Once a new listing hits the market, it has to fit into the hierarchy of all the houses available. If you have one of the better houses for sale, then a house better than your house hits the market, it makes buyers less interested in your house.
When you find the market has it’s eye on your house and you still haven’t gotten any offers, the best thing to do is reduce the price while you have the attention. If you wait, most likely what is going to happen is the market will move on to other houses and you will be right back where you were.