Buying the most expensive house on the block

mojc · #1 Feb 18, '12, 4:13 pm

So as a catholic family we have 6 kids 6 and under and probably more to come, hey we have 10 years of fertility left. We are in need of another house and in buffalo, the market has not really been hit so the prices are very competitive. We do want nore space and found a house that was totally renovated on a street that has much smaller and cheaper houses. The next cheapest house was sold for 65000 less and of course there are houses that went was an even bigger comp differential.

I know the old saying that yiu never buy the most expensive house on the block (which in this case isnt that expensive) as you can never re coup or renovate and get anything back. But if thr house is right and renovations done, is it a bad move? The street isnt terrible but not anything great either, but it is a safe area. Of course my realtor says to run from the most expensive house on a street.

But for 8 people and growing it fits the needs for the next 7-10 years where any other house comprable in a nicer area is almost impossible to find or out of uur price range.

Thoughts? Wait for a better investment? Try for a remarkable price?

**1ke** · #2 Feb 18, '12, 6:10 pm

You should look at a house as a lifestyle choice, not first and foremost as an investment. If you buy the house, stay in it, and it fits your needs-- why do you care how much it appreciates or depreciates? You don't. Do you expect to move frequently? If so, then RENT the nicest house in the neighborhood.

armywife · #3 Feb 18, '12, 6:12 pm

It wouldn't bother me (we are in the same boat as I'm preggers w/ #7) as long as I knew we would be in that house FOREVER. If it's an older neighborhood, the houses are often different price ranges/sizes.

mojc · #4 Feb 18, '12, 6:19 pm

It will not be a forever home, it actually will be more of an interim home for maybe 6-10 years. I want to be able to move into a part of the area with a piece of land and that is not financially feasible at this time, so the investment portion does play a role.

dcrowmik · #5 Feb 18, '12, 6:30 pm

Buy it now. Even the most expensive house on the street will go up in value over the next 7-10 years. If you can, hold on to it when you buy the next one.

mojc · #6 Feb 18, '12, 6:53 pm

even if its priced $65,000 over the 2nd most expensive house on the street?

dcrowmik · #7 Feb 18, '12, 7:32 pm

Quote:

Originally Posted by mojc

even if its priced $65,000 over the 2nd most expensive house on the street?

What's the average price per square foot of the comps and what is the price per square foot of the one you're thinking of? If the one you're thinking of is larger than the average comps you might find that the $65,000 is not too out of line for what you're getting.

MtnDwellar · #8 Feb 19, '12, 3:19 am

The adage of not buying the most expensive house on the block applies to houses that do not have significant features that justify the price. For instance, if a home is more expensive because of the decorating, ie flooring, wall covering, fixtures, etc. but appears similar in a listing regarding number of bedrooms, baths, sq. feet, etc., better to stay away.

Texas Roofer · #9 Feb 19, '12, 4:30 am

Quote:

Originally Posted by dcrowmik

What's the average price per square foot of the comps and what is the price per square foot of the one you're thinking of? If the one you're thinking of is larger than the average comps you might find that the $65,000 is not too out of line for what you're getting.

I second this, a larger house should be sightly less per square foot, as they do not have a stove/washer/dryer/frig per person. If the opposite is the case the house carries a large premium and thus it is a high risk investment. Bad investments seldom help the buyer, this may or may not be a bad investment but it needs heavy thought. After all it is unlikely to sell out from under you.

mary bobo · #10 Feb 19, '12, 11:45 am

Quote:

Originally Posted by dcrowmik

Buy it now. Even the most expensive house on the street will go up in value over the next 7-10 years. If you can, hold on to it when you buy the next one.

Don't be too sure that the value will go up. It has been quite a while since that has been the case in most areas.

jc-servant · #11 Feb 20, '12, 7:18 am

Quote:

Originally Posted by mojc

even if its priced $65,000 over the 2nd most expensive house on the street?

This sounds like a huge price disparity. I say skip it. A problem with houses is the "location, location, location" issue. Will you reach most of those who can afford the more expensive house if it is not located in a comparable neighborhood? When all of the houses are above a certain upper middleclass price point then the area's amenities and "feel" can change also. The $1,000,000 house in a comparable area will likely have a country club or better parks or stores or schools nearby. The same house surrounded by more modest homes is another matter.

My mother used to say that it is better to be the least expensive house on an expensive block than vice versa. A declining area can pull more value from the most expensive house on the block and a modest home in a great/popopular area can often command top dollar and sell faster because it allows people to "upgrade" their lifestyle for less money while obtaining the perks of the wealthier neighborhood. A city near me is so in demand because of their schools that people routinely place contracts without viewing the entry level homes so long as online photos and info don't show a huge red flag! I tried for months to view houses there, but repeatedly people snapped them up (in a soft market) and took a chance at losing the $100 or so given to place the initial contract hold pending inspection.

SamH · #12 Feb 20, '12, 11:17 am

Quote:

Originally Posted by dcrowmik

Buy it now. Even the most expensive house on the street will go up in value over the next 7-10 years. If you can, hold on to it when you buy the next one.

Very doubtful. The construction industry predicts at least three more years of declining values and lousy housing market in general. They don't predict it will end in three years either, that's just all the further out they were willing to predict.

If its not your "forever home" don't buy it.

IrishAm · #13 Feb 20, '12, 5:06 pm

Quote:

Originally Posted by SamH

Very doubtful. The construction industry predicts at least three more years of declining values and lousy housing market in general. They don't predict it will end in three years either, that's just all the further out they were willing to predict.

If its not your "forever home" don't buy it.

Ditto, ditto . . . A wise man has spoken here . . . (SamH, not me . . . :-) )

TheRealJuliane · #14 Feb 20, '12, 6:25 pm

Quote:

Originally Posted by mojc

So as a catholic family we have 6 kids 6 and under and probably more to come, hey we have 10 years of fertility left. We are in need of another house and in buffalo, the market has not really been hit so the prices are very competitive. We do want nore space and found a house that was totally renovated on a street that has much smaller and cheaper houses. The next cheapest house was sold for 65000 less and of course there are houses that went was an even bigger comp differential.

I know the old saying that yiu never buy the most expensive house on the block (which in this case isnt that expensive) as you can never re coup or renovate and get anything back. But if thr house is right and renovations done, is it a bad move? The street isnt terrible but not anything great either, but it is a safe area. Of course my realtor says to run from the most expensive house on a street.

But for 8 people and growing it fits the needs for the next 7-10 years where any other house comprable in a nicer area is almost impossible to find or out of uur price range.

Thoughts? Wait for a better investment? Try for a remarkable price?

That makes me a bit leery, honestly. Is the neighborhood starting to turn into a "tear down, turn around" type of situation, where people buy for the lot, tear down the old house and put up a new custom home which can then be resold? If that is the case, your house would be the oldest renovated house and people might want their own custom home instead of yours. The gap between your prospective house and the one that sold most recently is HUGE.

On the other hand, if someone does not want the grief of building, then you might resell easily.

On the 3rd hand, if it's a good value and you really think you will stay for a long time, well...

Your realtor has seen these things before. I'd try to listen, or you may regret it.

bscastro · #15 Feb 21, '12, 3:56 am

Hey there...I'm in Buffalo, NY too! LOL we've probably met!

God bless,
Bryan