Q: I really want to buy a property and stop renting, but right now the only thing I can afford is a one-bedroom condo, and “people” tell me that I must buy a two-bedroom- is that true?
A: This is what I refer to as the age-old bedroom conundrum. Every prospective home purchaser faces it. People always seem to feel pressure to buy more bedrooms than they actually need. I’m only one person but if I buy a one-bedroom condo, will no one else ever buy it from me? Or- We are a couple with a young child, but if we only buy a two-bedroom, what will we do when guests visit? Oh, the angst…
These questions would be worth debating in some instances. But here is the thing- these issues are keeping people trapped as renters, paralyzed by fear of not buying the ideal, forever home. Unable to afford that ideal home with all the extra bedrooms that they don’t need, they lose the opportunity to buy the home that may be perfect for them right now, and that they can actually afford!
Why the obsession with extra bedrooms? How many weeks a year do you have houseguests? Would you be willing to spend $200,000 to put your guests up in a luxury suite hotel? No? Then why are you willing to spend that (or more) on paying for an extra bedroom for them? There are always exceptions, but the majority of homeowners actually rarely use their extra room- it becomes the place to put all of your unwanted things, and guests are infrequent. Giving your friends and family free vacation housing should certainly not stand in the way of your buying a home for yourself.
A one-bedroom property is very comfortable for many people, but some hold out, hoping to continue to save enough for that extra bedroom. Why? There is a commonly held belief that one-bedrooms don’t sell as well as two-bedrooms. Well, they don’t need to- they only need to sell. You will neither be the first nor the last person to buy a one-bedroom condo, I assure you. Can they take longer to sell? Sometimes, but it’s not necessarily significant. For example, per the recent months’ property sales statistics, the median number of days on market to sell a one-bedroom condo in Los Angeles County was 17 versus 14 days for a 2-bedroom and 15 days for a 3-bedroom. Even if you can afford the extra bedrooms, you will typically be paying higher HOA dues, higher utility bills, AND you have no excuse when someone asks to stay with you while they “get on their feet”.
In all seriousness, acquiring real estate, especially your own home, is a critically important way to build wealth. Buying in the location you love, in a place you can be happy in is far more important than not buying because you can’t afford more than you actually need right now. Most people are able to buy their second home because they are selling the first one for a profit- often, you have to do nothing but live there and pay your mortgage instead of rent, and by the time you have outgrown the place, it thanks you with the down-payment for the upgrade. I’ve seen so many people miss their opportunity to become homeowners- instead of building equity in the smaller home or condo they can afford, they wait and hope for better while that goal becomes even more unattainable. It is incredibly difficult for most people to save for a down-payment in Los Angeles. When you scrape together enough to get out of your rental and start building your net worth, buy yourself something nice- nice for your needs and your wallet- and let Aunt Stella stay at the Marriott.
Disclaimer: This article is intended to be primarily for entertainment purposes and is not to be considered legal advice.
ABOUT LISA PHILLIPS, ESQ./ CA Dept. of Real Estate Lic# 01189413
Lisa Phillips is an active Realtor in the Los Angeles area, with close to 25 years as a practicing real estate broker and attorney. Lisa is also a member of the National Association of Realtors “Green Resource Council” and achieved its “GREEN” Designation. Her unparalleled knowledge of real estate, from local markets and pricing to legal issues and deal-making, has made her a trusted and valuable asset to her clients. In addition to her real estate and business savvy, Lisa is passionate about helping others, and works tirelessly to achieve the best results for her clients. For more information, please visit www.LisaPhillipsRealEstate.com.