Tuesday, January 29, 2013

Why Sell Now?

You may have lots of reasons to wait a year or two to sell. But if you've been thinking about it for a couple of years and are still on the fence, here's some bullet points discussed at my staff meeting this morning:

Reasons to Sell Now Rather Than Wait Til Next Year

*We don't know what next year will bring (9/11?); we do know that right now prices are up, competition for the few listings is fierce, and nearly three-quarters of listings are selling in multiple offers, which typically means fewer post-contract demands and negotiations for sellers.

*Interest rates remain low. As they rise--and they will, sometime--affordability and purchasing power will decline. A buyer with a $600,000 mortgage pays $2000 a month (at 4%) in interest today and can afford a home costing $750,000. When rates rise to 6%, than same buyer can afford a house costing only $500,000. their $2000 a month will cover only a $400,0000 loan. As interest rates rise, buyers can afford less, leaving fewer buyers competing for your home.

*In accelerating markets, the less expensive homes tend to appreciate in value more quickly (see above). Thus, a move down buyer may or may not garner more if they wait til next year, but it's likely your move down house will be disproportionately more expensive later.

*Waiting until next year is not cost-free: If you're ready to move now but choose to wait, you'll pay additional interest, taxes and insurance in the meanwhile (principal will reduce your outstanding loan amount). Sell now and those funds go into your new home; if you are downsizing, your "PITI" may well be lower during the coming year.

1 comment:

  1. These are definitely great tips. We've been thinking about selling for some time now and I'm really glad I got to read your post. It's not back to the conference table.