I was having a discussion with one of my clients the other day about the homes we have been looking at for her to purchase. I was telling her that every buyer, from the person looking for a studio condo to the family looking for the grand estate, always wants a little more than they can afford.
My client always seems to fall in love with that place that is just out of her price range. She said that it was just human nature, and that people, including herself, are greedy.
I told her that it was not being greedy, rather it is the natural desire of any buyer looking for property. It is the desire for value. You just want to know that what you are buying is in fact worth more than what you are paying for it, so you want the extra bedroom, or the bigger family room, or the better neighborhood.
It is always important to be a value buyer, because that is being a smart buyer, but it takes time and exposure to the inventory to really understand when you are seeing value, and when you are simply looking at something that is out of your price range.
In this market value often resides in future equity and equity growth often comes from improving conditions, whether it is an improving neighborhood, adding to the features of a property by fixing things or adding things, or simply taking advantage of a change in the market.
In any Real Estate Market, recognizing true value is the best approach to purchasing a property.
There is a lot to be said for the adage, "Buy the worst home in the best area you can afford."
