Danville Express

Real Estate - March 30, 2007

Finding that home sweet home

Figure out your needs and research neighborhoods as well as lending options

by Geoff Gillette

One of the first milestones to be encountered for any married couple is the purchase of their first home.

Throughout much of the country that means coming up with $150,000-$300,000 to get into that first residence. Here in Danville, though, where housing costs are much higher, getting into a house can be a bit trickier.

It's not impossible, it's just more difficult, says Ginny Mees, a Realtor with Keller-Williams.

Mees said she has sold homes to young couples in a first time home-buying experience. One such couple was Scott Ware and his wife Megan Bly.

Ware, 31, is employed by Yahoo and Bly, 32, is a school teacher. The pair has spent the last few years living in San Jose on a property Ware purchased prior to being married. Now, though, they've decided to buy their first home together.

He said they looked at a lot of possible locations in and around the city before settling on the Danville/Alamo area.

"Well, I'm from Danville so I've wanted to live there for a while," he said. "We looked all over and found that this one let us be close to family with a good commute to the South Bay. It was all those aspects that drew us in."

Ware said once they began to zero in on a location they did a lot of research online prior to meeting with a Realtor.

"We looked online to see what was available and what we could get in our price range," he said.

This led them to Mees, who took them out and showed them various houses that fit within their budget. As they viewed homes, their initial plan for buying a house changed.

"When we started we were thinking about getting something that we could get into and then either update or add on as time passed," Ware said. "We looked at a lot that we could build on, another where we'd tear down the existing house and rebuild and others where we'd add on."

At the time they were looking in a range just over $1 million. Ware said Mees suggested they looked at things just above their price range, in the area of $1.7 million and they found that they were able to get more house.

"We were surprised by how much of a difference it made," Ware said. "The second time we went out with Ginny we found the house in Alamo we are going to buy."

He knew even before they started looking for a house that it was an expensive place to live, but going from looking for a fixer-upper to the Alamo property they're buying took long deliberation.

"I had a pretty good idea of what I wanted the total cost to be. The only difference is that I shifted that money from what I expected to sink into the house once I owned it, to the actual acquisition of the house," Ware explained. "It wasn't that hard of a decision until it was time to pull the trigger. That was hard."

Unlike many first time homebuyers, Ware and Bly had funds to use in their purchase from a previous business investment. Mees said that's rarely the case with people new to homebuying.

"That doesn't mean it can't be done," she added.

The advice she gives people new to the area and looking for their first home is to determine their needs.

"Is it a young working couple with no children just looking to get a foothold in the area? Then maybe they want to be buy a condo or a townhouse," Mees said. "Do they have children and they need a yard and access to good schools? Then they may want to go with a single family home."

Mees said the market is beginning to heat up again partly because there are more buyers than sellers out there. As of March 8, Mees said there were around 130 single family homes on the market and only 40 condos.

She added that the downturn in the market has caused prices to dip, which can be a boon for a first time homebuyer.

"Getting a single family home for under $660,000 in Danville is unheard of," she noted. Condos can range from $410,000 up to nearly $900,000.

New homebuyers are advised to first find a reputable lender, in order to determine just how much they can afford. Next, get in touch with a Realtor who knows the area.

"There are neighborhoods in Danville that are great entry level homes for new homebuyers," said Mees. "A local Realtor will know where they are and can steer you toward them."

Another tip from Mees is to buy down your mortgage.

"One of the things we recommend to a first time homebuyer when you're buying in a higher valued area is rather than focus on the price, work on the seller to provide a credit to the buyer to help them buy down their interest rate. So instead of getting the seller to drop $50,000 from the price you buy down the mortgage by $50,000," she said. "Dropping the price won't do much for your mortgage payment, but paying down the mortgage will. You get more bang for your buck."

Ware offered these suggestions for those who want to buy a home:

* Take your time and narrow down where you want to live;

* Research neighborhoods to find ones that will serve your needs;

* Drive the neighborhoods once you've identified them;

* Talk to a lender to see what you can afford; and then

* Contact a reputable local Realtor to get you into the houses or neighborhoods you've identified.

Ware said he was pleased with the way the process unfolded for them and recommended having a solid game plan before jumping into the housing market.

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