A checklist for buying a home

Dated: April 21 2019

Views: 331

Top factors that should be considered when buying a home

We are emotional beings.  Every day we make decisions that effect on our futures; some large,  some small, some irreversible, some not so small and some totally irreversible. 

Emotions are the various bodily feelings associated with moodtemperamentpersonalitydisposition, and motivation and also with hormones such as dopamine, noradrenaline, and serotonin.  There is a great deal written about defining and categorizing emotions but for the purposes of this discussion about real estate decision factors, I’m talking about emotions in the sense that they have more to do with feelings, rather than logic.

There is an expression among many real estate agents: “Buyers are Liars.”

“They told me they wanted a three bedroom house with a two car garage so that’s what I showed them. They couldn’t find one they liked, and here it is three weeks later and they bought a four bedroom house with NO garage from another agent,” is the lament from the waylaid real estate agent.

Sound familiar?

What motivates one buyer to buy one type of house in one location and someone else another?

Of course the buyers are not liars; the agent obviously did not understand the motivation, goals, and emotions of her buyers and, like the definition of pornography:  “I’ll know it when I see it”, applies here. The buyers did not communicate their emotions and desires well to the agent. Heck, they may not have even known themselves; how the heck could they verbalize them to someone else?

Years ago Gail and I went to look at lots at Bill’s Mountain in North Carolina. At the time we were thinking of building a house up there. We stepped into the on site agents SUV and drove to a lot that had some of the trees cleared, there were a few picnic tables, and there was a place to park.  We spent a half hour at that first lot talking to the agent.  I later found out that this lot was called the “qualifier lot”. It’s where the agent could judge our reaction to views, grade, prices and other decision factors  so he would know what lots to show us.  It was a “qualifier lot.”

A smart real estate agent will do the same thing with houses. The first three houses shown to an early stage looker will be qualifiers: location, price, age, amount of renovation needed; all designed to help both the buyer and the agent working on their behalf to zero in on the best decision factors.  The really smart agents are experts at distilling through to the key points and then providing affirmation for the foundations factors, clarity on the superfluous factors, and the will be able to point out decision factors that have been overlooked but can sway a decision – things like cost to maintain or future assessments, the path of the sun and its effect on the home, or local unseen factors like transportation, noise, and local assessments.  

 I know I promised you a list of decision factors, and I will get to them, but let’s face it, there is not one list that will work for everyone.  This is because of emotions and individual family circumstances. You need to make your own list; and when you do make it, it will change based on the choices before you ( as in “Oh yeah, we need a whirlpool spa”).  A few years ago I wrote a column about decision making and Maslow’s hierarchy of needs.  If you need to prioritize your list it should be done with Maslows  scale in mind. First consider the physiological, (breathing, food, water , sex)  and then the safety issues,  (security of the body, shelter, health, morality and family);   then comes love and belonging (family, love, friendship, intimacy) and then the final: two self esteem and self actualization.  The top tears are considered more emotional decisions and the bottom more logical.  Economy fits into all categories but is considered a more logical factor than emotional.


In 2005 the economical decisions were put to the side, after all: most folk were all getting richer, indeed many went directly to self esteem and self actualization, assuming that safety and the base needs were a non starter and would take care of themselves.  Not so much today.  Buyers are more concerned with preserving the base of the pyramid. That’s because either they or those close to them have to come on down the pyramid and the foundation was not there to rely on – it was never built.

Well here is my list – for what it’s worth – and from this list you can try to make your own. Keep in mind this should be a book, not a list, and in its brevity will come errors and commission. Each item  - like location for example – could be a few chapters.

·         Where. The location. There are macro decisions like: Florida or New Jersey?; then there are micro decisions like which side of the houses faces the sun. Gated or not gated? Water front or golf view or close to work?  Close to family?  The number one deciding factor is family proximity, next is proximity to work. My advice?  Buy what IS and not what is going to or is promised to be. Don’t buy a promise, buy reality.  “Someday this will be nice out here” does not cut it for me. I want it here and now.

Where decision triggers:

·         Water, Golf, City, Preserve, Rural

·         Gated or not gated

·         Work

·         Family

·         Transportation ( airport, highways, busses)

·         Old neighborhood or new

·         Education

·         Medicine

·         Shopping

·         Pedestrian friendly

·         Taxes and assessments

·         Recreation

·         Culture

·         Affordability. Here you need an expert’s advice. It’s one thing to be able to afford to buy, it is another to be able to afford to maintain a home, heat and cool it, and keep it secure, and insure it.

·         Price. Pretty simple. But its just the beginning.

·         Cost of the mortgage. Interest rate terms and down payment.. Newer homes with net zero energy bill will allow you to borrow more, for example.

·         Utilities.. A good agent will get you the average electric bill for the last 12 months; compare; can you improve it?

·         Capital improvements like roof, air-conditioning, driveway, windows, and doors. Will they need to be replaced soon?

·         Energy efficiency. Get HERS rating (Home Energy Rating System)

·         Maintenance. Is there wood or hardy board? Lots of painting or just washing?

·         Insurance. The same home in a coastal high hazard zone may cost three times as much to inure as one inland. Old homes cost more than new homes to insure. Insurance has become such a major factor in home buying decisions that we will urge our buyers to get comparable insurance quotes when deciding between two houses. We use Dean Street Insurance (full disclosure – I own part of the company)

·         How far to work and recreation?  (Gas is not cheap)

·         The Jones factor.  Can you afford to live like your immediate neighbors? Do you want to?

·                     What?  The “what” has a great deal with the stage you are in your life. Most of us buy for the long term but only live in the home for 4 years.  The choices are governed by affordability but chosen by lifestyle

·         Condo – If you don’t mind the compromises necessitated by the condo life style – you will love the security and the care free maintenance issues.   “Shut the door and leave” is a common exclaim about from condo owners.  Price comparables are another – it’s an easy task to determine the value of your condo – there are so many just like it. And don’t forget the amenities like the exercise room and pool. For a helpful article about comparison shopping and a more detailed list click here.

·         Single family homes.  Privacy and the ability for multiple private spaces are a common desire among single family home buyers.

·         Age. The charm that comes with old also may indicate smaller closets, inferior efficiency, and high maintenance costs. Electric and plumbing should be examined along with roofs, insulation, and fixtures

·         New or a fixer upper? In today’s market there are many bargains for the strong of wallet and/or repair skills.  (Look for Cat Pee)

·                     Extra Stuff

·         Pool or not?  Pools are more visual than actually used.. The cost to maintain a pool can start at around $200.month. For a simple easy access back year you can add a pool for around $30,000.. Prices go up from there. 

·         Garage. Floridians are not different from northerners; they keep things and stuff in their garages. But since we have no basements we have more stuff and more things to keep. So, while you don’t need to keep you car out of the snow, you do need to protect it from the sun and you do need storage.

·         Amenities.  Common area items normally come with condos and gated community homes – like pools, tennis courts, etc.   

The decision you make, whether based on logic like the price, or self actualization like  the appearance, can only be made by you. You should get a good advisor, but remember – it’s up to you and your family to live with the decision you made.

Blog author image

Gregg Fous

Real estate has been my passion since I took my first Al Lowery class on real estate investing in the 1970’s. I vowed during that class that I would buy one property a year. Over the next five ....

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