I like to think of it as an investment in a very limited resource….specifically, planet Earth. When you buy a home, you are actually becoming the proud owner of a small piece of the planet. When you think about home ownership like this, it is easy to understand why real estate has historically been such a solid investment and why with population growth, values have climbed astronomically over the past 70 years.
We all want to make excellent decisions when we invest. The long standing advice, “Buy low – sell high,” holds true today. As property values have climbed, prospective buyers find themselves questioning how it could possibly be the right time to buy. I remember the fear that I felt over the price that I paid on the second home I purchased, in 2000. The home and yard were beautiful and offered just about everything that I was hoping to find within my budget, however, the price was higher than any other home had ever sold in the same neighborhood. Today, the value of that home is over 300% higher.
The Bay Area in general (and specifically the west side of Danville) has been notorious for crazy-strong “Seller’s” markets. The best homes often receive overwhelming interest, and bidding wars are not uncommon, especially when the market is strong. My advice to buyers searching for a long time investment is to buy when the market is uncertain and others decide to sit on the fence. Why? You can actually be true to yourself and make a smart decision. A balanced market provides a much bigger selection of homes to choose from, so that you can shop and wait to find the one that most closely matches your needs, your budget, desired location and your dream style or features. You will likely also be in a stronger position to negotiate favorable terms, including inspection contingencies. As many past home buyers know, this can be far less expensive than paying top dollar for a house that isn’t necessarily what you want or need, or gambling on unknown conditions. If it’s a long term investment, history shows us that you will likely see both a great return on your investment and the joy that comes from living in a house that feels like home!
If you or someone you know is thinking about buying a little piece of the planet, I’d love to be your guide. My experience is worth so much more than an app on your phone. You can reach me at 925-964-5010 or Lisa.Hopkins@Compass.com. Perhaps it’s time to help your kids with their first home investment?
By Lisa Hopkins-Cochran, Realtor® at Compass
