In the last few months I have heard variations on this statement in various forms and guises. My knee-jerk reaction to comments like this aren’t very PC. Generally it would be something like “Everyone settles to some extent. We all have to “settle” for less than we would ultimately love. That’s life.” Truth be told ever since I’ve been in this business I’ve noticed the same trend. Everyone seems to want about $50-$100k more than they can possibly afford.
Part of this angst is due to tighter lending standards which means that relatively solvent families have to squeeze into less home than the more relaxed standards of the past would allow. We got used to those loose standards and being allowed to buy a large house seemed like a right, not a privilege.
Recently, I think would-be buyers are confusing not getting everything they want with the notion that the market is still overpriced. Listen up buyers….I know you are disappointed, but Westchester NY is EXPENSIVE. This has nothing to do with a market that isn’t full corrected. It has always been this way. If you want to live roughly 30 minutes from midtown Manhattan you will pay for the privilege. This is nothing new and has held for bull and bear markets alike. Affordability hasn’t been this favorable in nearly 50 years – since before even I was born. If you are disappointed now about what you can afford, realize that it is not likely to improve and it could be much worse. Wait until interest rates rise 1%. A 1% increase in interest rates corresponds to a 10% loss in buying power. So waiting can make you lose considerable buying power.
Back in the dark ages of my parents time – and even my earlier days – we bought less house initially and moved up later. We understood that you had to take baby steps to that big house. You have to start somewhere. If you are a 20-something you may have to forego that second bedroom or those granite counters and tumbled marble baths. Perhaps you can have an extra bedroom if you buy something that needs a little elbow grease. For buyers of larger single family homes, you may have to go to a neighboring town that isn’t a “name” town or it means you have to buy a fixer or a smaller home. Maybe it means accepting a home on a busier street or further from the center of town. At the end of the day, the buyer has to prioritize and most will have to sacrifice something they would really love to have.
But the bottom line is that that kind of give and take is the normal part of the purchasing process. It has nothing to do with an overpriced market. In fact some sectors of our market are going up in price while others are bouncing along the bottom. At this point buyers should be more concerned with factors that could decrease their buying power in the future than the notion that the housing market is still overheated.
© 2011 Ruthmarie G. Hicks – https://thewestchesterview.com – All rights reserved.
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