Dec
21
2006
Budget Determines Where You Live
By Charles TurnerUsing our new map search tool, I searched for homes in the downtown and surrounding areas in $200,000 increments.
Up to $200,000:
$200,000-$400,000:
$400,000-$600,000
$600,000-$800,000
$800,000-$1,000,000
Over $1,000,000
Gee, there are a lot fewer homes on the market in the price ranges most people can afford than in the market for the very few wealthy folks.
Does that mean that most buyers are still feeling the effects of a competitive market? That only well-heeled buyers have an advantage in the negotiation phase?
There is always more competition at the lower end of the price spectrum. The entire qualified market can purchase at lower prices.
As prices increase, qualified buyers become fewer and fewer.
The first-time buyer is often at a disadvantage because they may not have the cash position that other buyers have. Cash is king. The less money the buyer puts down, the weaker the deal for the seller. The closer you get to 100% financing, the higher the risk of the deal failing at the end because of lender stipulations.
But remember, financing is only one component of the offer. We’ve got lesser offers accepted on other merits.