Aldy Way

When looking at home, one is tempted to buy the best house in the neighborhood. If you buy the most expensive houses on the block? No

Think Long-Term

I guess you fall in love with the master of the house in a neighborhood. It's everything you could imagine: black bottom pool, marble, an incredible kitchen, top of the line windows, stunning brick work and so dalje.Prodavača obviously put a lot of time, effort and money in the house. Accordingly, it stands out as the pearl on the block. Why would not you want to bite right away?

Before signing the documents, look at the sales prices of comparable homes, "comps" in the neighborhood. If you compare the prices of comp dream home, you should notice a pretty significant price difference. This difference has to act as a metaphorical slap in the face or pouring cold water over glavom.San home is undoubtedly a sales price range far beyond the comps. Warning lights should be going at this time.

You're going to have problems if you into temptation and buy the most expensive houses on the block. In fact, you're going to have two problems.

The first problem is the appreciation of the value kuće.Zahvalnost the best home in the neighborhood will always pull down the structures around it. If you take home $ 900,000 from a private community and put it on a block of $ 250,000 to monitor homes, $ 900,000 value would go down a lot because the neighborhood will not support it. When you eventually sell, buyers will look at comps in the neighborhood and laugh at the $ 900,000 asking price.

The second problem is "hemming". Since you own the most expensive houses in the neighborhood, your appreciation potential is already limited. This becomes a bigger problem if you want to remodel or add on a home. Taking such action would usually add value of your home. With the most expensive homes, not only will it not add value, to be reduced in its capital. Why? If you do $ 50,000 remodel, you can see a $ 10,000 profit for the $ 50,000 price. You just lost $ 40,000.

dream or nightmare

If you can accurately predict the increase in valuation for the whole neighborhood, you should not buy the most expensive houses on the block. If you do, dream home can quickly turn into a nightmare.