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This doesn’t mean *ignore* the comps if something seems way out of line. But otherwise/generally, yes.
Rising Star
Real estate agents are some of the scummiest and dumbest rent sucking middle men in the US. Go with your gut - but this market is crazy, especially in desirable locations.
Buy a house that you can afford and that meets your minimum criteria. If you want to stretch and know you’ll be someplace a long time, go outside your comfort zone. But know the risks. The real estate market doesn’t always appreciate year over year the way it has recently.
My thoughts exactly. If a real estate agent says it, I highly question it.
Pro
I mean, sort of. But I believe it took some people YEARS to recoup the losses experienced in 2008. Didn’t matter if you’d lived in your house for 2 years or 20 years.
Pro
But also, they may have bought in early 07 based on 06 comps lol
It’s sort of true and sort of not. Comps are important for financing. You want to make sure you can get your loan and that the price isn’t totally out of whack for the market. You also want to make sure you are paying somewhat of the market rate.
Those caveats aside, this is a house you will be living in for the presumable future. You can’t get so hung up on getting the best deal and making an investment profit that you lose sight of the fact that it will be your home. You want to be comfortable there and want to live in it.
When we bought our house in 2018, we spent a little more than we planned because we loved it. We could fully afford it and it ticked all of our boxes. We have never regretted that decision, and with WFH my husband and I have said a bunch of times how grateful we are to be in a place we love.
Yeah ok, but pull the comps please and do your job. Pulling comps is not difficult. Ask again.
Maybe but you don’t know how life will happen. We planned to be in our house forever and ended up having a need to sell it and move sooner than expected. So don’t get too emotional and overspend or, be willing to lose whatever extra you gamble with.
It depends on your priority. Is this more of an investment to you, or your long term home?
I’d say don’t miss out on the “perfect” house if it’s slightly more expensive than other comps, unless you’re not picky and think you can quickly find another house that meets your criteria. However still review comps and don’t let emotion take over you to offer significantly above market value
Look at the growth rates which are implicit in the realtor's claims. Ask yourself whether they're realistic for your area, since real estate is a large number of local markets. Then ask yourself whether you can service the debt / other expenses on the house without becoming house-poor. From that, you can assess how likely those claims are.
There's also an element of "nobody knows what the market could look like in 10 years" which us true. Think about what the real estate market went through between 2002 and 2012!
Took a 35k loss vs my purchase price when selling my home in 2019 in a nice western suburb of Chicago, even after spending at least 100k over 12 years on various improvements.
Probably would have broke even if I had waited 3 months for the pandemic driven market.
Seems like realtor is conflating finding the right home with paying the right price. Ideally, it's both. I do agree with longer timeline.. what we learned in last downturn was make sure you are ready for longer haul. So if market crashes, you aren't at a loss because you stay put until it recovers if you can. That's what we did, 10 years later, sold, small profit.
Do your own research, look up properties in same area on realtor.c..Don't look at their estimates look at history of actual sales 2006 thru now. See ups and downs, relisting and price drops. That will give you perspective.
Pro
Depends on the market but yah pretty much
Chief
Nice but the appraiser is going to look at comps. So unless that doesn’t matter (ie paying cash) then comps matter.
Pro
This ^^
Gotta be close enough to comps to get loan funded.
Also: Remember that the realtors chief incentive is not aligned with yours - for every 10k of sale price, agent earns another 300 or more.