Buyer expectations create impediment to home sales

An article by Kenneth Harney of the Washington Post News Service in the March 7, 2011 edition of Banker and Tradesman (not available free online) suggests that rising expectations of home buyers are condemning many potential home sales to failure. Anecdotally, brokers tell of buyers expecting the amenities of a $500,000 house in one selling for less than $200,000 including things such as granite countertops and stainless steel appliances. The author attributes these changing expectations to a couple of things. One is that down payment requirements have risen substantially ("the median down payment . . . has jumped to 20 percent compared to 'close to zero' five years ago"). With people stretching just to make the down payment, they have little money available for after-purchase renovations or fix-ups. The second factor is cultural. With the rising popularity of cable TV programs such as Home and Garden TV, more people have set their expectations of features in a home based on television programs rather than real life. Whatever the cause, if this perception is true it's too bad, because the last thing needed in this depressed market is more reasons for people not to purchase homes.