Property guru Veronica Morgan shares her top tips on how to make a compromise when it comes to managing your property expectations!
I was helping Juliet to buy a new home in the inner west of Sydney which is one of the most popular places to live and your money doesn’t buy much. I mean she had a bit over $900,000 to spend and that barely bought her a two bedroom cottage - believe it or not. So she had to start thinking about what she’s prepared to compromise on.
It’s important to understand too if you’re prepared to make a compromise that you want to make sure that you’re not going too far out outside of the square. By that I mean if you like purple kitchens and purple bathrooms, that may suit your specific taste but you will really ostracize a large part of the market.
Try to keep compromises normal.
The property that Juliet bought actually had a compromised floor plan in my view. The second bedroom had a staircase basically cutting it in half. Now for Juliet’s purposes that was fine because she was using it as a home office and had a sofa bed in it. The bottom line is most buyers wouldn’t see it the way she did, so that is what we would regard as a compromise.
Juliet will be getting a discount buying the property but she'll also be giving a discount down the track when she goes to sell it.
The rule of thumb here is, if you are making a compromise, check that compromise against the norm on other properties in the surrounding area. so for example, its ok to buy a property that doesn’t have any off street parking, but if the rest of the properties in the area have an expectation to have it, that’s gonna severely compromise it as well.
How does your compromise stack up?
Now owner occupiers often aren’t as focused on capital growth as investors are but I believe that they should be because that is the potential resale value of that property. and so these areas in which you might be compromising in order to buy on a great location, they have to be really considered very thoroughly.
So if you are compromising ah make sure that it’s not compromising on something that’s really going to affect you badly when it comes your turn to sell.
Your choices may affect your investment.
The great thing about Juliet is that she made the ultimate decision with her eyes wide open. she went back there to that property. she actually loved it for the way in which she wanted to live in it and she also spent a lot of time in the surrounding area to make sure that she could really see herself settling in there and becoming part of the community