During the home search, buyers go on the lookout for the "perfect home". Outside of the general factors of price, location and condition of the home, there are many other factors that should also be taken into consideration. These should not be overlooked when purchasing a home and should you choose to ignore them, understand that they are likely to factor in to a homebuyers decision to purchase your home down the road. Let's get started...
1. Deferred Maintenance - OK, let's assume you conduct inspections and your home inspector notes 15 problems (or potential problems) with the home. A reasonable outcome is a buyer and seller agree to the correction of some of the items. 90 percent of the transactions we see arrive at this conclusion. But buyers should be aware that the items that aren't corrected would likely need corrected prior to selling the home down the road. For example, let's say you have a bathroom exhaust fan that is not working in a secondary bathroom that will be rarely used. Not a problem you say? Well, that bathroom may be very important to the next buyer, so be aware that it will need to be fixed at some point in the future. On a side note, if you choose to not fix the problem it would have to be disclosed on the seller's disclosure later.
2. Specific Location of the Home - OK, let's assume the general location of the home you are looking at is excellent - the neighborhood is close to work and there is a great park located right there within the subdivision. Those are appealing features, but buyers should be aware that those factors could mean nothing to the next buyer if the home also backs to a highway. In fact it could be a complete showstopper for most buyers - even if the home is absolutely perfect otherwise. When selling the home later, buyers can count on having competition (other homes for sale at the same time) when they go to sell. That means future buyers will have choices that will likely include a similar home that does NOT back to a highway. So if a buyer decides to move forward with purchasing a home that backs to a highway or other questionable feature such as a water tower or power lines, the buyer should be confident they are purchasing the home at an appropriate price within the particular community. This will likely mean purchasing the home at a price that is less than similar homes that are located on a typical interior street within the community.
3. New Home Competition - OK, let's assume you decide to purchase in a new home community. You are getting a brand new home with the exciting new finishing touches, including lights, appliances and floor coverings. That is an exciting experience but when buying in a new home community, buyers should consider that down the road the same factors that lured them in (living in a brand new home) could also be an obstacle when selling. At that point your home will now a resale home and the next buyer may skip right past your home to purchase a brand new home in the next phase of the same community. So when buying in a new home community it is more important to consider you may need to stay in the home for a while to avoid facing heavy new home competition when selling your home.
4. Size of Home - OK, let's assume you decide to purchase the largest home in the neighborhood. It's understandable that many people want to own a home that stands head and shoulders above other area homes. But if by head and shoulders we mean literally by size, that is where homebuyers can run into trouble. It is vital that homes within a community are comparable in size to the other homes within the neighborhood. Having a home that is 25% larger than other homes in the area can really cause problems when it's time to sell. The home may seem worth the price compared to homes in the subdivision a mile down the road, but it needs to have comparable homes located within the given community as well. So before buying a home make sure you are confident that the home is a typical for community. This will be important to buyers down the road and will also help to ensure appraisers have adequate comparable homes to arrive at a satisfactory appraisal.
5. Neighbor's Pride of Home Ownership - OK, let's assume that the real estate transaction was a smooth process and you have now closed on your new home. You are excited to be moved in but within a week problems with the neighbors become a concern. The car that is sitting on the driveway of the home to the east? Well they aren't just in the middle of putting new brakes on that car. The car has been sitting there since the previous winter. The neighbor of the home across the street that you thought had killed off his lawn to renovate it with a fall reseeding? Well that dirt has seen the four seasons - twice. Remember when buying a home that you have options. If something doesn't seem right in the neighborhood, check it out. Ask the neighbor in question what is going on - or ask other neighbors about the situation. Remember, when you buy a home you are also buying the neighborhood - and the neighbors that go with it.
There you go -- five factors that can kill your home's resale value. These are just a some of the additional important factors that homebuyers should consider as they work towards maximizing their real estate investment. A real estate agent with expertise in your area will point out these factors and many others relating to the home buying process. Should you choose to ignore any of the above factors when buying a home, be sure you have factored it into the purchase price of the home, because you will likely deal with it at some point down the road.