While it is almost always true that owning a home is better for your financial health than renting, that is only true if you buy a home that can be sold again, when you choose to sell it. Some homes are a lot harder to sell than others. Here are some key things to avoid when selecting your first home – homes that may look like great deals but really are not.
1. Homes on busy roads. Keep in mind that traffic will likely increase, not decrease, and roads may need to be widened in the future. Many buyers will not consider homes directly on busy roads due to noise or safety concerns, and these homes will typically not appreciate as fast as similar homes nearby that are not affected by the traffic. Families with small children will not want their toddlers to be close to busy roads for fear of the little ones wandering into the street, so the house will go up in value much less than homes away from the traffic. The same is true for homes on the planned path for new roads – major interstates that may be extended years from now, but take its planned path into consideration.
2. Homes close to industrial or commercial facilities. Some are definitely worse than others – homes within walking distance of shopping may actually be a great investment. Being next to hazardous waste sites might be the worst. But having a great view of a water tower, a cell tower, a gas station, or dealing with constant large truck traffic such as from a quarry can be a real problem. So check out the surrounding area, don’t just look at the home.
3. Flood zones. It is not always obvious by looking at a home – have your Realtor confirm whether or not the home is in a flood zone. The Army Corps of Engineers has established flood zones that are shown on survey maps. If the zone is just a small part of the lot, that may not be a concern, but if the home itself likely to be invaded by flood waters, that will be a major issue.
4. Flat out ugly homes. I’m sorry, but we’ve all seen them. You look, and your first reaction is negative. You look again, and it’s still bad. If you can’t fix it with paint or landscaping, think a third time. If your reaction now is “what was the builder thinking?”, it probably won’t get more attractive, or easier to sell, with age.
5. Most expensive home in the neighborhood. This may not turn out to be a big problem if the neighborhood might catch up over time – people adding on or even tearing down and building new. But if the home you like is clearly going to overwhelm the neighbors for a long time, recognize that the sales price is determined by “location, location, location” (i.e., the neighborhood) as much as it is by the house. So, if you have the mansion in a neighborhood of tiny homes, the tiny homes will drag your value down
There are other issues that affect resale value that you and your Realtor should consider. The ones mentioned hear are bad moves, so don’t do them.