House hunting? Skip the dream homes and aim for 'good enough'

Constructed from reality TV, the dream home floats in the imagination like a castle in the sky but dissolves in the rain of hard numbers.

For many home buyers, buying a "good enough" home can be a sounder strategy, particularly for those most eager to become homeowners.

"I'd rather see people buy a good enough home vs. buying a dream home and being cash-strapped over the next 20 years," said Alyssa Lum, a certified financial planner in Herndon, Va.

A good enough home may not have artisan tile, but it has the essentials.

Look for a home that's well-maintained, has "good bones" and is in a good location, said Kelly Roth, a real estate agent with Pearson Smith Realty in Ashburn, Va. A well-maintained home in a good location will likely increase in value and probably won't be a money pit.

Buyers tend to home in on cosmetic upgrades, Roth said, but she advises focusing on basics, like windows, the roof and the heating and air conditioning system.

It's important that a good enough home fits your lifestyle.

Roth tells of a couple who fell in love with a home that looked like a dream. But the commute to work — 90 minutes each way — became a nightmare. "They bought it in August and sold it in March," Roth said. "Good" is personal. A big yard could be a must for a family with a dog, but a pain if you hate yardwork.

And a good home matches your timeline. It should meet your needs for the years you plan to live there, which probably isn't forever if it's a first home, Roth said.

Finally, a good enough home has a reasonable price for your budget. Lum recommends keeping your debt-to-income ratio under 30%. That's the percentage of gross monthly income that goes toward debt payments, including the mortgage.

Lenders will qualify buyers with higher ratios. But that may not leave much for other expenses

"Maxing out (debt-to-income) is something I see people do, but not something I recommend," said Trey Reed, a loan officer near Washington, D.C.

A good enough home leaves you with enough money for other priorities, such as saving for retirement and emergencies, and for all the costs of ownership besides the mortgage. That includes home insurance, property taxes, utilities and maintenance.

Finally, remember that you can add dreamy features like high end kitchen appliances and three season porches later.

Barbara Marquand is a writer at NerdWallet. E-mail: bmarquand@nerdwallet.com. Twitter: @barbaramarquand.