The agent felt the location and other negatives would not matter because of the quality of the house. Does that make sense?

No. It sounds like this house is overbuilt for the area. You do NOT want the most expensive house in the neighborhood.

+1 to previous response. Unless the neighborhood is going through a revitalization - you will have bragging rights of the best home but never have real comps during a sale.

Quality of a home adds maybe 5-15K to the price but typically sq ft, rooms and bath are the core to a comp. How much is an even price sq ft, bdrms, bath in the same zip code and than you adjust for quality of fixtures.

"The house is also right next door to a popular local restaurant."

Just how noisy does the restaurant get evenings and weekends? Not just in the restaurant itself, but out in the parking lot. Does it have a nice, calm, sedate, sober clientle, or will there be drunken brawls in the parking lot every weekend?

How much traffic does the restaurant generate? Would the homeowner have difficulty getting in or out of the driveway at busy times? Do patrons of the restaurant ever try to park in the house's driveway? Or park on the street in such a way as to block the driveway?

The restaurant alone would have me very leery of buying this house.

Remember, the agent wants you to buy a house, any house, so that the agent gets paid. If you don't like the house, and you seem to have a significant number of issues with the house, the location and the price, then wait for a better house to show up.

Being 75 ft from a busy road is not a sound barrier at all unless you are not sensitive to noise and always keep windows closed. Windows open you will hear it, smell diesel fumes and depending on where you are geographically, will get road dust, too. I'm 2 miles from a highway and can hear it at night and there are plenty of trees, houses and grade changes in between - sound travels. That alone would make me walk away and even more so with the info given above.

In my town houses that back up to the commercial strip of restaurants/shops sell at quite a discount from those that are just a block over, even though the road the houses sit on is a side road, just the fact the homes abutt a commercial property is a big negative.

Another thing about restaurants--you can get a lot of cooking smells from them. Hang around during their busy times to see if you smell anything. Would you want to have to keep your windows closed all the time?

And remember, all the doubts you are having--if you buy this house and ever have to sell it--prospective buyers will be having the exact same doubts.

I wouldn't worry about the perceived value of the house. I'd reject it based on the location. You can't change the location.

Location is an "incurable defect" - that's how important it is.
No matter what anyone does to this property, it will be next to a restaurant (noise, smell, overflow parking in front of your house, etc) and on a busy street, and busy streets almost never get less busy. And that will always eliminate growing families from the buyer pool even if you're in the best school district in the country, and many others who know better than to buy on a busy street.
The fact that your agent is telling you that it's okay to pay a premium for a "defective" house tells me that you need a new agent. He/she ought to know that it'll never appraise anyway based on what you've said.

Perhaps this house is also zoned for commercial use given your description of the location and the restaurant next door. That might push the value up. In terms of a house for a family, I would walk away.

I also think a house in a development would be a lot more desirable. Being on a quiet street is one of our main criteria during our search. i think that house is going to sit and sit if they don't lower the price quite a bit from comparable homes in neighborhoods.

A busy two-lane road can soon become a four-lane road. And heaven forbid that the powers-that-be decide to use YOUR land to build the road on. Even worse if they decide to make it a four-lane divided road -- you could find your 75-foot setback shrunk to 35 feet or less!

Don't buy this house. It has too much going against it.

Run away from this house and this realtor as fast as you can.

Thank you all for your comments. I knew I could count on you guys to set me straight.

We picked the agent because of her many years of experience in selling houses in all price ranges. We told her from the beginning it was overpriced. She said she would look at it with us and give us her honest opinion. Before we even got into the house she was raving how wonderful the front door was. It's a nice door, but standard. She raved about the paint colors and everything else she came across and never noticed the house didn't have a deck until we pointed it out. After finally admitting that was the only negative, she felt a small cut off the asking price, 4%, would be ok. Any other negatives we mentioned were not important. She even told us people don't want to live in developments because all the houses are the same. She's lived in a development for 20 years. We realized the whole point of showing us the house was just to talk us into buying it at list price and not coming up with a fair price.

The house really is perfect for us. But except for all wood floors and granite kitchen counter, the other features are average. There are no expensive windows, no elaborate baths, no above average sized rooms. These are things I find in similar priced homes in great neighborhoods.

So for now, unless there is a drastic price cut, we do nothing. I hate to leave it go, but I don't want to be the sucker stuck with a house that won't sell.

Another downfall of living near a restaurant- at the end of the night when they dump the glass bottles into the dumpster, or the garbage truck coming to empty the dumpster early in the morning. I lived with that noise for a week while I stayed at a friend's apartment, and it was an eye-opener, literally and figuratively.

I agree with everyone else-this house probably isn't a good deal, even if the price gets reduced. Keep looking... the right house is out there.

"Remember, the agent wants you to buy a house, any house, so that the agent gets paid."

"The fact that your agent is telling you that it's okay to pay a premium for a "defective" house tells me that you need a new agent."

Ditto. I wouldn't waste another 5 minutes with this agent/idiot.

We had someone like this. She showed us houses that met none of our criteria. Then when we found a place she refused to try and negotiate a lower price. Said we'd better pay what he was asking or we could 'lose' the house. BS.

We did the negotiations (with her sitting there with her not saying a single word on our behalf) and got the price down 25k.

Next she purposely neglected to tell us about two important inspection deadlines so that we would be forced to buy the place anyway. Both inspections failed. The seller took us to court to sue and force the sale anyway. We had to hire a lawyer because our 'representative/buyers agent' lied about being able to use an attorney from her office. Even after this she tried to hold us to a one year contract that would have given her a commission for ANY house we might buy whether we used her or not.

This was from a 'veteran' agent of at least 25 yrs in the business.

We fired her, had our lawyer send her boss a letter demanding to be released from our contract or they would have another lawsuit on their hands.

Do yourself a favor and try to find a house on your own (like we ended up doing). I doubt you will do any worse than we did.

Just get a real estate attorney to look over all the paperwork.

What might be a nice, respectable restaurant now, that maybe you don't have a problem living next to, could become a trashy biker bar or a strip club in the future. Even if it does stay nice, you still have all the traffic and noise associated with the business. The ONLY way I would see living next to a place like that as a positive would be if you had plans of running your own business from your house.

Dreamgarden I am surprised that, inspection or not, the buyers' nondisclosure of a material defect large enough to have such an impact on the inspections was not enough to void the contract or at least make the sellers liable in some way.

You can always put in an offer and see what happens. The worst they can say is no, and counter you. Remember, they want to sell the house, and may work with a lower price. Just don't low ball them to the point of insult.

Location is an "incurable defect" - that's how important it is.
No matter what anyone does to this property, it will be next to a restaurant (noise, smell, overflow parking in front of your house, etc) and on

c9Pilot: You left out the part about the mice.

My previous house had a Chain-Store Doughnut shop behind it.
I can't tell you how much I spent on mouse traps.

C9pilot is exactly right.

tom418 - lol
Of course, here we have "fruit rats" and our biggest challenge is just to keep them in the yard and out of the screened lanai (they chew through the screen and snack on stray bird and dog food pellets that are left in the bowls - had to move that all inside our small house). And off the fruit trees. We were too squeamish for regular traps so we got a humane trap and have a rat relocation program.
All the banana plants and papayas are fruiting right now, so I sense that we'll be trapping again soon.

Suppose that you love this house too much and decide to buy it not considering the many problems it has but will you be able to sell it again whenever you want to sell it- may be years or even months later? Nobody wants to live near a restaurant to smell food all day long or keep the windows closed to avoid it.