First-time buyers demand perfection in older, low-priced starter homes

WASHINGTON -- Are first-time home buyers passing up great deals because they insist on houses requiring little or no changes -- even at the price levels where shoppers traditionally have been willing to factor fix-ups into their offers?

Or are they simply reflecting market realities?

They see record inventories of houses sitting unsold, and they may not have the money, time, or inclination to do fix-ups.

Holly Kirby Weatherwax, a Reston, Va., agent, said in an interview that some shoppers are so picky that they walk out of well-priced houses solely because of relatively minor imperfections such as the kitchen appliances are by different manufacturers, there are no granite countertops, a carpet needs to be replaced or the color doesn't match their furniture, or wall colors are "wrong," such as white, when for today's tastes, they should be some warmer hue.

"They're missing out on some excellent, older lived-in houses," she said. "It's a shame, simply because they can't overlook" flaws that would not have bothered shoppers during the previous two decades.

Zillow, the giant Seattle-based online real estate research and data company, suggests any shift to greater attention to details may be an inevitable byproduct of higher down-payment minimums and more stringent loan qualification requirements.

Said Zillow spokesman Katie Curnette, shoppers in 2011 "are really in the driver's seat. Nationally, buyers who purchased homes last December paid 4 percent less than the asking price. That points to a lot of room for negotiating and opportunities for buyers to be choosy."

Some agents suggest that buyers today tend to be hipper and more sophisticated about home design, furnishings, floor materials, counters and appliances because they are exposed to far more information on cable TV than earlier generations of first-timers.

But that may also be fostering a lack of realism on shoppers' part, according to agents.

Cindy Westfall, a broker in Lake Oswego, Ore., said in an interview that she recently had a shopper who was interested only in older houses under $200,000 but who wouldn't tolerate even the sort of minor imperfections and nicks typical for older houses.

"The fact is," she said, "you just can't have it all. You can't have the big yard, the top-line updates, and all that in a starter home. You've got to compromise somewhere or else you'll never buy anything."