My friend and past client, Bob (name changed for privacy) was interested in buying a condo. However, the concern was the list price was the highest in the history of the complex since right before the 2007-2008 housing bubble burst. He was worried that if he were to pay the list price, he wouldn’t be getting a good value. However he loved the unit, and the location.
So I went to work to see what else was available in the area and surrounding neighborhoods. The idea was to see if I could find something comparable in a similar price range. What did I find? Nothing! There was nothing that was comparable, unless he was willing to go above his budget. The condos going for less money were smaller and/or in less desirable areas. We discussed it. He could let this one go and hope to find something similar, or lock this one in.
So what did he do? He wrote an offer on it, one of four offers, and he got it. Since then, he couldn’t be happier. The condo values in the complex have continued to rise and he ended up saving thousands of dollars and a lot of time.
The lesson here is that sometimes you have to take a look and see what is available and compare it to what is on the table. If you have options, meaning there are many homes that are similar, then you can pick which one you want. But if there are limitations on what is available, then sometimes it can be worth taking the chance and grabbing the opportunity. No one can predict the future, and that includes what homes are coming up. If you are getting a mortgage, then a licensed appraiser will be providing their unbiased valuation. That is another layer of protection.
Seeing what is available is an interesting way to evaluate a home. Of course check recent sales to make sure that you don’t overpay because at the end of the day, you are the one making the payments.
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