 Every time I talk with a new client about selling their home, I get the same comment, "Todd, my home just isn't worth what is was four (4) years ago, so why would I want to put it on the market?" or, "So I put my home on the market, there's no way I'm going to get what it's worth." Here's a good one, and one of my favorites, "In 5 years the market is BOUND to recover a bit. I'll sell then." I pride myself is calling it straight, so here are my comments... First... Yes, your home ISN'T worth what it was four (4) years ago. Would it have been great to sell your home for TWICE what you paid? Of course... For the 10 minutes after you sign the paperwork, you would be feeling amazing...! REALITY BREAK MOMENT In the home frenzy between 2002-2007 you might have been able to sell your $100k (original cost) home for $330k. I fall into into this category. If I had sold (lured by the money), I could have pocketed a TON of cash. Paid off some loans, bought some toys, cleaned up any lingering credit cards. Hey, I could have started over in many ways. I would have also been looking for another home... So here am, looking for another home. Surprise, Surprise... All the homes I'm now interested in purchasing have also tripled in price. I wouldn't have been alone. This happened a LOT..! Homeowners sold, only to find that the homes they could "afford" (based on their income), weren't AS NICE... The only thing that basically stayed the same? Everyone's INCOME...! Yes, the banks were a bit loose with money back then. I could have wiggled my way into a loan for the $600k home, but my payment would have TRIPLED..! All the money I "made" on selling my home (what was left), would have went right back into the home I purchased. The difference? Well, my new home was pretty much what I sold, only with a higher mortgage...!  TODAY'S MARKET Your home is now worth $180k, much lower than the market highs. However, the home you're looking at (you know, the one above) is now selling for $300k (maybe less if bank owned). You crunch the numbers, and "low and behold" you can actually afford to make the move. Some (Not many, since my clients are the smartest in Phoenix) of my clients loose focus on what goes into buying a home. It comes down to basically the following points...
Questions 1-5 are important, but those are FACTS of buying ANY home. Number six (6) is the MOST IMPORTANT. Number six (6) is DIRECTLY related to how much you're spending. The price of the home you're buying. Your TOP DOLLAR... If you focus on your home, and not the home you're interested in, you're going to make a HUGE mistake..! Yes, we all hope the market recovers. But when it does, the home you're looking at is going to head up in price too... It'll become more expensive, and possibly out of your budget. So, is it a good time to sell, even if you're home isn't worth what it was back in 2007? Yes, because everyone took the SAME hit, making your dream home now affordable. |
