I know Spanish tapas are all the rage, but I have to say that I have never quite "gotten" them - even when I visited Spain! The idea of spending $12 for a plate of olives or a small sampling of salt cod goes against my middle-class, hard-working values. If you aren't careful, $60 and two hours later, you can leave the restaurant still feeling hungry.
On the other hand, I purchased 12 "day-old" bagels for only a buck-twenty ($1.20) at the market next door to our GRUBB Co. offices in Berkeley last week and felt as if I had won the lottery. (Score!) Growing up in Old Land Park, my dad used to send my twin sister and I down to Marie's Doughnuts ("Home of the six-cent doughnut!") to buy a dozen glazed on Sunday mornings (Yum!). Total cost: 72 cents - now that was a deal AND they threw in the 13th doughnut for free. There's something about securing a bargain that makes my heart sing. Whether it's the flea market, an estate sale or the bakery, I am a gal who likes a good value! (Who doesn't?)
Sure, there are still the exalted few who never bother to compare prices (even in this economy) but for most of us, understanding "the value" in any purchase is key to actually committing to it. In my experience, this holds AS TRUE for the $450,000 condominium as it does for the four million dollar home. Regardless of what one can afford, "value" is very much a part of the calculation.
However, "value" isn't just reflected in price per square foot or the desirability of the street. In order to accurately speak to "value" I need to also address "costs," which are often more important in establishing real value to the buyer.
Really? (Yes!) Here's why . . .
While the "value" reflects what's concrete (the price you pay) the "cost" reflects many of the less tangible, underlying needs associated with a home purchase: (the requirements of your family; the proximity to work and to schools; the interest rates in today's market versus tomorrow's; rising private school tuition; the weekends dedicated to searching for a home that might be better spent playing baseball with the kids; your desire to live near a park, a shopping district, a bus line; your need to entertain, to nest, to establish roots, to create memories . . .) the intangibles are endless and as varied as the buyers themselves.
Examined more broadly, there is so much more to the value of a home than simply the price you pay. Once you understand your underlying motivations for any purchase, your goals should become crystal clear; better helping you to identify "good value" when you see it (as opposed to the bargain).
Define both your position (value) and your interests (cost) and you will quickly come to terms on what you need, how quickly you need it and what you are willing to spend for it. Focus on the whole picture (not just the price) and you are much more like to secure the "value" you seek.
That's where the real bargain exists. Ole!
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Julie Gardner, has been writing The Perspective for 18 years and has published more than 670 essays on life and real estate.