Smart Moves by Ellen James Martin

Making Tough Choices in a Tough Market

A couple in their early 30s have been diligently saving to buy their first home for more than 12 months. Both have steady jobs and have accepted overtime to help amass a down payment. But now, as they embark on their house hunt, they’re feeling alarmed.

Available properties in their price range are very few in number. Moreover, as soon as they spot a house to their liking, they face fierce competition from rival buyers willing to bid over the asking price. This situation has led to sharp disagreements as to whether they should push forward or postpone in hopes the market will cool down.

Economists who track real estate markets aren’t surprised by the couple’s reactions to the situation they’re now facing.

“First-time homebuyers face a perfect storm this spring. Affordable, move-in-ready starter homes have become harder to find amid rising home prices and mortgage rates,” says Cheryl Young, a senior economist at Trulia, a real estate data firm.

John Rygiol, a veteran real estate broker who works solely with buyers, says current market conditions are leading to many heated arguments among couples about how to proceed. But he insists that postponing a purchase would be a mistake for most people who are now renting.

“Home prices aren’t going to drop, and neither are mortgage rates,” says Rygiol, who’s affiliated with the National Association of Exclusive Buyer Agents (naeba.org).

To meet the challenge of the highly competitive starter-home market, some couples are considering a “fixer-upper” that requires substantial work to meet their standards. But Young cautions that such a property could require more costly upgrades than many buyers anticipate.

Here are a few pointers for home-buying couples:

-- Let go of the notion that either spouse has all the right answers.

Real estate agents often observe battles fought between spouses trying to agree on home selection. And often, amid the bickering, they hear one partner assert that the other is mistaken in expressing his or her preferences.

“A lot of times, clients don’t realize how stubborn and self-righteous they can get about what they consider the best place to live,” says Mark Nash, a longtime broker and author of “1001 Tips for Buying and Selling a Home.”

Nash urges couples planning a purchase to go through a methodical process of setting priorities before they venture into house hunting.

“As a first step, each partner should sit down alone to draft a list of their own wishes in a home. Only then should they get together to create a joint list -- one that reflects the factors most valued by each person,” Nash says.

But what if both spouses are unclear about what they’re seeking in a home? One method of gaining focus -- sometimes advocated by real estate agents -- is to “go negative.” List all the things you dislike about the place where you now live; then flip these to reveal what you want most.

-- Look to your real estate agent for help to iron out differences.

Some would-be purchasers -- especially those planning to buy in high-cost areas -- struggle to reach agreement on how best to allocate their scarce dollars. In such situations, each partner should focus not only on their priorities but also the trade-offs they could accept, says Merrill Ottwein, a broker who heads a realty firm specializing in relocation.

“(A) real estate agent can help them pick their better trade-off,” Ottwein says.

Of course, agents aren’t marriage counselors, and they can’t be expected to resolve irreconcilable differences between husband and wife. But they can help mediate conversations that help couples settle minor disputes.

“A good agent will ask penetrating questions, encouraging the buyers to reach their own conclusions,” Ottwein says.

-- Allow yourself extra home shopping time if your marriage is young.

Obviously, people who’ve been married for many years know a lot more about each other than do younger couples. Therefore, they’ll need to deliberate longer to ensure that both partners’ views are taken into account when a home is chosen.

“People who’ve just gotten remarried after many years of living alone should be extra wary about misjudging a partner. Your spouse may have developed some very strong predilections through the years,” Ottwein says.

You may need several long conversations -- or perhaps even a getaway weekend -- to reach agreement on the best housing choice for both of you.

“It’s vastly better to hash out your differences before picking a property than to make a choice your spouse despises, which could lead to many quarrels later,” Ottwein says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)