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Monday, January 07, 2013

Should one buy the smallest house in a given neighborhood? The smallest Mercedes is still a Mercedes.

I saw a little Mercedes pull into my neighborhood yesterday evening. I wondered why buy such a tiny Mercedes when, for the same price, you can buy a larger domestic car?

Then, being a real estate agent, I had to turn that into a real estate a question.

Why buy the smallest home in one neighborhood instead of a larger home in a different neighborhood?  Some of the answers to both questions are really quite similar.

Such as…
  • Long term value.  Resale value on some vehicles is higher.   If the long term goal is moving up to a larger house as needs grow then the potential resale value of a smaller house in a more desirable community may influence the decision. 
  • Pride of ownership.  Lets face it, we are human.  I know this is kind of superficial but first impressions set the tone for much in life.  Many of us want people to see we have good taste in things like what we drive, wear and where we live.  
  • Safety and security.  I am not aware of the specific safety rating of individual cars but many choose cars for this reason.   Likewise, some neighborhoods may give a feeling of increased safety.   This is where I caution buyers to check with local law enforcement for information on actual crime rates in any neighborhood or area.  
So should one buy the smallest house in a given neighborhood?  It depends on individual goals, preferences and  taste.  Pretty much the same things that go into the decision to buy a small Mercedes or a larger domestic car.

Here is another perspective on this from the seller's position...

If I have the biggest house in the neighborhood, do I have an advantage when selling?

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