Knowing the answer to “when should I sell” is possibly something you might want to know. Especially after the torrid marketplace we had this spring. With house values increasing 37% in the last year could now be the time?
If you are asking yourself this question you should consider the following:
Does our current home meet all of our needs?
- This will vary depending on what stage of life you are at. Maybe your family has grown and you need more room. Perhaps your family is smaller and it is time to downsize.
Could we improve on our current equity position?
- Generally speaking, if your move into a bigger more expensive property, the affect of a change in value will be greater. If your current property is worth $500,000 and property values increase on average 3% per year, in 5 years its value could be $579,637.04. Moving up to a property with a value of 750,000 you might expect an increase of $119,455.56. $39,818.52 more than by staying where you are. Of course you should always factor in the cost of your move. If using this reason to move, then plan on staying in the new property for 5 years or more to capitalize on the increase. Historically Real Estate is best as a long term investment.
Where would we rather live?
- Maybe you live on a busy street or have a steep driveway. Maybe there is something else about your current property that is not desirable. The best time to sell a property with unattractive features is in an active market.
What does our budget allow?
- It is important to know what your budget will allow in comparison to your lifestyle. Don’t plan on becoming house poor by buying a property beyond what is comfortable. Knowing when to sell is greatly affected by knowing the answer to what your budget will allow. Timing is important to consider here as well.
In times when property values increase dramatically, people will sometimes think it is a good time to refinance and take out equity. If you are considering that as an option, I would still recommend you ask the same questions that relate to selling your property. Removing equity is essentially a similar action as deciding to sell your home. Using your home equity as a bank account might not be in your best interest for non home-improvement type expenses.
These questions are not intended to be an exhaustive list but rather a starting place for you as you consider your Real Estate options. Your situation is unique and to truly determine your course of action should include a consultation with your Real Estate Professional. If you currently don’t have one, we would like to offer our expertise. An Initial Consultation is at no cost or obligation. Please feel free to call, text or email at your convenience.
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