Your Dream Home is not in this Price Range, but your Starter Home is.

I remember our first home, I oved it, but it was not our dream home, it was small but affordable and it worked perfectly for us as our first home. Part of the buyer conversation is talking about expectations and giving guidance.

Bob, I really like your to the point message to lst Time Homebuyers in this blog!  It is hard in a want it buy it now credit world for young people today.  Many parents attending viewings don't help.  They point out all the negatives and forget that most home buyers including their kids can't afford to start out with the perfect house or it be anywhere near as nice a property as the parents own.  Starter houses aren't going to be perfect.  The days of low offers to see what the seller says is a big "NO" from the sellers today.  As you say, the sellers are accepting offers close to, full price or higher than list especially in low inventory areas.

Sometimes I think men can get away with to the point questions.  One of the male agents I worked brought his clients back to the office.  I heard him say to them "Are you going to buy this house or not?"  Then he waited to see what they would say.  The buyers hesitated being put on the spot but then started laughing and answered.   I don't know that I can be that blunt but it works for him.

Buyers can build on their dream  one house at a time until their fantasy becomes a reality!  I tell buyers that I've heard/noticed over the years that buyers typically move every 5-7 years.  It is a process to get to where you want to be.  However, I've noticed that Realtors tend to stay in their same homes numerous years me included :-)

I think Tracy Lee Parker said it best - "They want what they want and they want it NOW!" But you're right when you say you have to work your way up. Unfortunately, that mindset doesn't work for everybody and some young couples do manage to buy what they want. The thing is, when you have the best right from the beginning, where do you go from there?

Wow - that's a great way of looking at it. I don't deal with many first-time homebuyers, but the idea of paying the same price but mentally adjusting what  you're buying would be helpful to any frustrated buyer.

Maybe the "dream" must be adjusted some, Bob Crane ... the dream becoming homeownership, instead of a specific home with specific bells and whistles. 

From a very personal perspective, homeownership was certainly my wife's and my bottom line, dream, and goal.  Our first home was far ... FAR away from being any dream palace.  But it got us into the market.  40 years later we still look on that first purchase and home as the smartest monetary decision/investment we ever made.

Just another comment (sorry) ... but where are the Lenders in this conversation?  You either qualify to buy a certain price range of home or you don't.  That message must be clear ... and absorbed by the potential Buyers ...

I agree with those that say this is a fantastic post and message, Bob ... well done.  Congrats on the Feature!

Gene

In our markets we have many hidden gems that require some elbow grease.  There is a lot of room for improvement in equity when you can put a smart amount of work into a house.  

So agree Bob Crane ! Some buyers just don't understand the numbers or the want vs need game.  I typically say something like - it's important to get started with what you can afford - and work your way up to your dream home over the years like almost everyone else does too! They ususally get it.

Hi Bob

There is such an important message, or set of messages here. Expectations of buyers, especially first timers and people relocating from less expensive areas are often not consistent with reality. And sometimes those WANTS take over when the focus should be on the NEEDS.

Jeff

If you are dreaming of being a home owner then these homes will certainly meet the criteria. The alternative is to save more money and have a bigger down payment on the home your have been dreaming of. 

Congratulations on the Featured Post Bob Crane ... I have been there and done that so many times with buyers.  Sooner or later you have to have that heart-to-heart talk with them ... or after enough offers have been denied talk about the importance of not thinking too long ... start somewhere ... I love this meme that says it all:

There are very low inventories of starter homes in good enough shape to pass FHA or VA in my area.  So...if you see one, get it!

I think before much work is done there should be a realistic discussion of what budget will allow.  But as we have seen before, some people have a cushion that they will not disclose.  Only a real financial statement can reveal that.

Oh this is exactly what I am dealing with now. They have a budget, but want more . It isn't going to happen. I think my reality check finally settled into them and now we are looking at what's in their price range. May not be theperfect one but doable. They now get it.

I was one of those buyers....looking for something that others said didn't exist in today's market. I continued to believe that I would find "the one" and I eventually did. It took over a year of looking but we found it.

We were very very lucky that we were cash buyers with no need to sell a home first...there were multiple offers, some higher than ours. Cash is king!

I have this same problem with first time buyers. I find myself sitting them and going over these same things. It usually takes seeing a couple of homes before reality sets in, but having the talk BEFORE they see any homes, can stop the feelings of dream home being in their Price range and forming a new perception of what their dream should be

So true!  It's exciting, romantic, to think about that first home--esp if you watch a lot of HGTV!  Setting the expectations is important--most buyers in this market must understand to get what they want, they may to go up in price--.  And every house is going to have some negative.

^^ We get a  lot of "dream" shoppers that watch too much HGTV and are not ready to buy what they can afford.

It's tough out there for first time homebuyers. I work with FTHB a lot and fortunately find they do have a reasonable budget in mind. However that budget does not get them in the area they want.  This is where my realtor partners come in and suggest other areas to look that they might not have thought of. The expectations talk is so important.

Excellent advice.  A buyer's mindset is oftentimes mismatched with their budget.  Having "the talk" can help guide them into accepting what they can purchase for what price.  

Well said; maybe there should be a license to be earned before a purchaser can start looking to buy a home!