Ohio Real Estate News, Demographics, Listings

“There are more programs now then ever before”
(this line is a stretch as the amount of programs have diminished) 

“It does not make sense to rent” 

“Because of low demand you can get a real deal”

Con ~ 

“Wait another year as values will continue to decline!” 

I have found that most of the time people make the decision to purchase a home (at least in Cleveland) because of the following: 

I want one floor (the steps are killing me)! 

First child or another one on the way (need more room)! 

This place is just too big (kids are gone – don’t need all of this space)! 

Let’s find a getaway place!

Tired of apartment living (want a place of my own)!

Can’t take the yard work (condo living)

Want a view of the Lake!

Want the best school system!

I don’t want to do without and want to be pampered (amenities)!

Mom is moving in with us (In-law suite or multi-family)!

Want to invest in a small investment property!  

Found a place near our friends/family!

Want to bury myself in a project (fixer upper)!

Want a small place to hang my hat (not home much)!

Want a nice lot in the country (rural setting)! 

Today so much emphasis seems to be placed on the investment aspects of homeownership.  It seems as though we are desperate and trying to create demand when it is just as easy to shoot holes in this theory.  Buy now rates are down vs. Don’t buy now values are declining.  I bought my first home in 1988.  It was a three family dwelling and I had lived in it since I had moved out of my parents’ home.  My landlord had tried to sell it (overpriced) and after the listing expired I had an impulse to look in to buying it.  I never thought for a minute about available programs or what rates were or why am I renting until after I had the impulse to buy it?  As a matter of fact prior to this impulse would you have told me I was crazy for renting I would have told you that you were crazy because it was my only means of not living at home anymore!  I did think wouldn’t it be cool to own this place and maybe the math would work out where it made sense.  I also thought, what will I do if all 3 furnaces go at once as it would cost me $10,000 (of course we all know in 1988 I could have replaced all 3 for under $2,000)!   

Then I sold it and moved out to the country.  I thought I didn’t like city living anymore.  Then I hit a deer! 

Anyway, the analysts and the experts and the crystal ball people will tell you to buy in Boise now because it will be a hot market in 3 years and you will do well.  I guess if that is why you buy residential real estate then it is a good idea.  I just don’t know anyone in Boise so I would not buy a home there.  I could tell you to move to Cleveland because we have one of the best freeway systems (low traffic), all the water you can drink (Lake Erie), brick homes (because we don’t have to worry about earthquakes and homes with no hurricanes clips (yes you guessed it we don’t have those either) but if you don’t have emotional ties for being there why would you live there (I always mess up the spelling of there/their so don’t bother telling me if I’m wrong).  Even when relocating because of work if you don’t think you will like it there or won’t know anyone despite the fact it is a good job it will hamper your decision.

The real focus of a home purchase is usually emotional.  I speak in generalities but why would you buy?  Because rates are low? Doubtful, the fact that rates are low will speak to whether the emotional decision is feasible but not be the basis of the decision on its own. When I work with people I ask question after question after question trying to drill down to get to the party’s aspirations and most of the time it is emotional with some rational.  Do you really need a view of the Lake?  Do you really need the extra bedroom because you will soon have two children?  Where I grew up the family that lived behind me had at one time 9 or 10 kids in a 4 br / 2 1/2 bath colonial!  We would be wise to promote the non-investment benefits of home ownership as no matter what the market conditions the above issues will always apply.  When demand is high you will simply pay a higher price for the benefits and vice versa.

Crazy as it sounds when demand was high and prices were rising in Cleveland, OH in 2002 based on the investment aspect approach we should have heard on the news don’t buy now as it is not a good time to buy.

Thank you kindly, 

BGW