Jul. 4, 2008 - Should I Sell My House Now or Wait?
Recently I am meeting three kinds of people who are considering selling their current home. Some are buying a bigger home, while others are buying a smaller home, and some are selling and renting.
Use the same line of thinking from my previous article, that is to expect the market to be down over the next 3-5 years. Sellers have missed the peak of the market, for sure. But really, who can pick absolute peak without hindsight?
Yes, I think if you sell this year you will sell for less than you could have sold for last year. But I also think the liklihood is that you WILL sell for less than this year, if you are already considering selling and decide to wait.
Let's say the market goes down for 3 years and not 5. It could still stay flat for two years after that. It could take 7 years for it to get back to where it is now or where it was last year. Can you see yourself waiting for 7 years? Can you hang in there without home equity loans or cash-out REFIs for 7 years? If no, then bite the bullet and sell now, and forget that you could have gotten more last year.
More importantly, know that when you sell your home you are "Paid in Full" and hopefully "Debt-Free" for a split second when you close escrow. Now think hard about what that means to you in your life at the moment.
- If you are young, and your income is high, you want to talk to an accountant about what you are losing in tax write offs and seek appropriated advices about what to do next.
- If you are near retirement and don't see yourself retiring where you are but still need to work where you are, consider renting where you are and buying where you will be retiring. Talk to an accountant about being able to claim your future home as your current primary residence and the requirements for doing that.
- If you need a home for your family, your pets and your hobbies and cannot enjoy your life in a rental for many reasons, then buy wisely. Buy in the best area your money can buy, so that you are buying in the strongest of markets and the one that will go down the least and spring back first.
Look at selling and becoming Debt-Free as an opportunity to start over from this point forward. Shake all of the advices out of your head, yes even mine! :) Ask youself what would make you happiest rigfht now in terms of where to live and what to live in. Make yourself happy...life's too short. But when you consider "happy" don't forget to consider the financial aspects of paying the monthly cost of where you will be going.
Make yourself as happy as you can without over-extending yourself. Pick the best where and the best what...and don't forget "the sleep factor".
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