Does anyone ever get a "fab first home"?
fab (adjective) /fab/ 1. Fabulous; wonderful.
Merriam-Webster Dictionary
You have got to be kidding.
That was my first reaction to the recent Bankrate.com article "Must-haves for a fab first home". My second was, "that's so not helpful". Because I work with lots of first-time buyers, and one of my biggest challenges is managing expectations.
Of course, "fab" is relative. The first home my parents bought, a small inexpensive bungalow built out in the boonies not because the location was so bucolic but because the land was so cheap, looked plenty fab compared to the housing project they'd been living in. (Come to think of it, "boonies" and "cheap" also describe the third house they bought.) But honestly, that relative jump in quality of life is as good as it gets for any first-time home buyer who isn't writing checks on Daddy's trust fund. First-time fab is real and I've seen it, but it comes, not from buying the house someone twice your age making three times the money can buy, but from owning your own home, be it ever so humble—and it will be.
Unless you take Bankrate.com's four hot tips for home buyers to heart. Because then the only home you'll ever know will be your fab rental.
"An affordable price tag"
"Stay within a reasonable budget" sounds like great advice and is—in the abstract. The problem is that local first-timers don't buy homes in the abstract, they buy in one of the priciest housing markets in the country. And what they can easily afford may not be what they're willing to settle for, particularly if they follow Bankrate.com's three other tips.
"A house for the next 10 years"
"Buy a first home that accommodates not only the family you have now but the one you plan to have over 10 years...really think about what your future looks like." Great! Except who really knows what their future looks like, however hard they ponder? Will you move six times in your first nine years of marriage, as my parents did? (They used Mayflower so often that as a kid I got the same rise seeing the Mayflower logo on a moving van that other kids get seeing the logo of their favorite sports team.) Will you have two kids, or five kids, or no kids? Will the city and neighborhood that suit you just fine at 25 still suit you at 35, or will your tastes and needs change? Will you be making the same money at 35 that you did at 25? Will you move in the same circles, have the same co-workers, friends and interests?
"Space is probably a higher priority than fancy features such as granite countertops...don't...overpay for features and amenities, or remodels, that you're not going to be able to recoup later on." Granite is "fancy"? Whoever said this never worked with a typical Silicon Valley first-timer. Or tried to sell a home in Silicon Valley that didn't have granite.
"Location, location, location...find a neighborhood that's stable...because those are the ones that are going to get you the best return later." There's a novel thought, and I'll bet you'd never think of looking for these qualities in your first home either:
No, you wouldn't, not you and not every other home buyer out there, including home buyers twice the age of the typical first-timer and making three times the money.
"A history of proper maintenance"
Let's see: great neighborhood, great location, great schools...and no fixers. The kind of shopping list every first-timer should carry in his back pocket. Along with his boss's checkbook.
"Recent updates in key areas of the home"
Yes, first-timers, don't settle for anything less than "energy-efficient windows [cost: well into the five figures, depending on quality, although I like the white vinyl kind that makes an old rancher look like a Martian spaceship], updated electrical wiring with sufficient outlets [add $10-15,000 to the price of the house], a new [$20,000] roof, and a new water heater".
And remember Bankrate.com's caution about not overpaying for bling because you'll never get your money back? "Bathrooms and kitchens are the most important pieces of the puzzle...if they have been renovated...those are the things that give it the most attraction when you go to sell your house later".
No kidding. Not to mention they'll enhance your enjoyment of the home, the home you'll supposedly live in for the next ten (or is it one hundred?) years.
By now I think we know Bankrate.com's perfect house for the local first-timer: an expanded, gutted-to-the-studs rancher in Los Altos. Cost? $2,000,000. Very affordable!
It's easy—oh so easy—to write off "Must-haves for a fab first home" as more of the fatuous but plausible real estate advice the media dishes out daily, especially when most of these pearls of wisdom come from people who've never worked with a first-time buyer. And then there's "don't pay for upgrades/but look for upgrades", which strikes me (and should have struck the article's editor) as a bit contradictory. But I suspect that buried somewhere under all the paint-by-numbers journalism and quotes from people who comment on real estate but don't work in real estate is a kernel of truth, and it's probably this: the vast majority of first-time home buyers across the country don't face the challenges local first-timers do. You can make darn good money here, and you probably do, but you can still be limited to small, beat-up, obsolete sixty-year-old ranchers in so-so neighborhoods served by low-testing schools and miles from decent amenities.
You can make the best of it, or you can drift in and out of the market, never seeing anything you like because you're looking for that "fab first home".