Bigger Home or a Better Area?
A prestigious address and a fancy Southland ZIP Code. As a home buyer, you may not give a hoot about such intangibles. Yet as a purchaser concerned about your net worth, you can’t afford to ignore the financial advantages of status, real estate specialists say.
“You’re almost always better off trading down on the amenities of a home if the payoff is getting into a classy neighborhood,” said Leo Berard, charter president of the National Assn. of Exclusive Buyer Agents.
You may not envision yourself in the Jaguar crowd. Yet if you can afford the equivalent of a luxury car when you select a neighborhood, you can expect your property to ascend in value faster than if you bought in an “economy car” area.
Prestigious neighborhoods “do appreciate more in value,” said Liz Reilly, a Coldwell Banker agent based in Westlake Village who has sold real estate since 1988.
Still, not every home in a classy community is a good value, Berard said. “For instance, you wouldn’t want a ‘white elephant’ that is totally different in architecture than other homes in the community--such as an A-frame house surrounded by Colonials.”
But investment potential is only one factor in buying a home, he said. “As with any decision in real estate, you have to think about your quality of life and how the home is going to be used. You don’t want to make huge sacrifices in your living needs,” he said.
For instance, some purchasers with several growing children may find that moving to a small house with just two or three bedrooms and a pint-sized den is unacceptable--even if it gets them into a “right neighborhood” where values could one day spiral.
“Bigger homes are more in vogue now, and that mentality continues to grow,” Berard said.
In the ideal world, anyone seeking both a spacious home and a treasured address should be able to achieve both. But sometimes compromises are necessary.
Here are several pointers for buyers:
* Paint a self-portrait of your ideal lifestyle.
Whenever Berard acquires new clients for the real estate firm he co-owns, he always asks what they’ve liked or disliked about their past habitats.
Such questions can be used as a jumping-off place to set priorities for the selection of a next home.
For instance, if there is an annoying lack of storage space in your current place, you may consider walk-in closets a must in your next home.
Perhaps you also hanker for the garage you didn’t have before, because your hobby is to work on vintage cars. On the other hand, your current home may have just the kind of “country kitchen” that you feel is essential for your family.
Such a self-portrait can be used as a basis for setting priorities when you consider what you would--or wouldn’t--give up to get a home in a prime neighborhood, Berard said.
* Don’t bank on adding a wing to a small house without investigating.
Perhaps you’re eyeing a small split-level house built amid more lavish residences in a very popular part of town. The property seems to afford enough land to add a wing for your mother-in-law, whom you expect to move in during the next couple of years, by which time you hope to be able to afford the addition.
But before you commit to the purchase of the property, you should visit local government offices to be sure local zoning regulations would allow your building project, Berard said.
Reilly, the Westlake Village agent, also suggests you call in an architect or building contractor to assess whether the addition is viable. Often, a modest home with amply sized rooms could be a better choice for an extra wing, while a place with small rooms could be dwarfed by an addition.
* Ask a home inspector or structural engineer about building skyward.
Virtually everyone who buys a property should have a general home inspection--if only to be sure the roof doesn’t need replacing or that the cooling system is not failing. But if your plans for a tiny house in a prestige neighborhood call for adding a second floor, you should go beyond a basic home inspection and bring in a structural engineer, Reilly said.
An engineer should be able to tell you if the home’s foundation and footings are sound enough to sustain a vertical addition. Likewise, an engineer can ascertain whether adding a room over the garage is plausible.
But Reilly cautions that additions “almost universally cost more than you expect”--sometimes even double the original estimate.
* Don’t move into a marginal area unless you have no other alternative.
If your budget for housing is tight, compromises can help get you closer to your goal without giving it up altogether. For example, you may be able to buy a more affordable home on the outskirts of an A-level neighborhood, Berard said.
But you should nearly always avoid buying in a marginal neighborhood, Berard said, such as one that is seriously flawed by commercial blight, heavy traffic congestion, loud environmental noise, pollution or foul smells.
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Ellen James Martin is a syndicated columnist. She can be reached via e-mail at ellenjamesmartin@aol.com. However, she cannot answer questions individually. Distributed by Universal Press Syndicate.
