Should I Sell My Home or Wait?

Should I sell my home or wait?

Homeowners are asking us this year – should I sell my home or wait?  In the past five years, if a homeowner did not have to sell, then many chose to rent and wait for values to rise. Others had to sell because of their financial situations and some chose a ‘strategic default.’

Low Inventory and Rising Prices

The 2012 real estate market cleared out much of the inventory of homes for sale. 2013 has seen an increase in both list price and sales price for single family homes and townhomes. Condos still have financing issues, which keeps their prices down, with exceptions in sought after communities. When a Seller looks at the houses around them selling, they wonder: should I sell my home or wait?

The Cost of Waiting

There is a cost to money, and waiting to sell your home in 2013 could cost tens of thousands in years to come. Here is an example of the cost of waiting to sell your home in 2013:

Value of Home           $200,000                                         Buy in 2013                  $400,000
2013 Appreciation    $   6,000 – 10,000                          2013 Appreciation     $  12,000 – 20,000

2014 Value                  $206,000 – 210,000                     2014 Value                   $412,000-420,000

2019 Value                                                                              2019 Value
at 3-5% per Year        $245,766-268,019                        at 3-5% per Year         $477,620-536,038

Equity Earned             $45,766-68,019                            Equity Earned              $ 77,620-136,038

A person who sells their $200,000 home in 2013 and moves up to a $400,000 home will earn between $31,854 and  $68,019 more equity in their new home because it appreciates at a higher rate than the $200,000 home did.  There is also the cost of maintaining the current home and surprise repairs in a home we are not going to keep, versus buying a new home with less maintenance, or at least repairing a home we know we will live in for a long time. Third, there is the possibility of interest rates rising.

So next time you ask yourself should I sell my home or wait? – remember these Seller tips. Your dream home just may be waiting for you and you don’t want to miss it.

2 Responses to “Should I Sell My Home or Wait?”

  1. June 28, 2013 at 10:32 am, Janice Waston said:

    So if I am selling a $400,000 house and downsizing to a $200,000 house paying cash, then I should wait?

    Reply

    • June 29, 2013 at 9:31 pm, sharonalters said:

      Janice, you have asked a great question. It totally depends on whether it is more important to you to wait and take more cash from your house, or go ahead and snap up the perfect $200,000 house when it comes on the market. From a Seller’s viewpoint, interest rates are still very low and there is a good buyer pool wanting more-up homes such as your $400,000 property. If rates keep going up, then that buyer pool will shrink, softening values. If you are working and want to buy a smaller home when you stop working, then it makes sense to wait. But if you want a condo at the beach, now is a fantastic time to still get some great values.

      Also consider your monthly costs – will you save substantially to move to a smaller home? Will the smaller home be newer and less risk of something breaking or having to be replaced? Hope this was helpful to you. Let us know anything else we can answer as you make this decision.

      Reply

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