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"We are going to wait to sell until after this Buyer’s Market"

By
Real Estate Agent with Keller Williams - Paint Creek 6501330622

I hear this time and again from potential home sellers.  It seems the overriding sentiment among sellers is that it is best to sell in a "Seller's Market".  In some cases this may be true.  However, in more cases than one would think, a "Buyer's Market" is the perfect time to sell your home.  I will elaborate on what I mean in the following paragraphs.  In today's article I will look at one example of a situation in which now (epitome of the "Buyer's Market") is the ideal time to sell your home.

If you are considering moving to a larger, more expensive home, the ideal time to buy, especially in Rochester Hills and Oakland Township (as in most of the metro Detroit region) is now.  Sure, you will not get for your home what you think it is worth.  You may not even get what you paid for it.  However, if you have the resources available, and you can price your house realistically (with your head and not your heart), now can be the perfect time to make that move to a more expensive and larger home.  I will explain why I say this.

Imagine you own a home that last year was worth $400,000.  In today's market, it is not uncommon for that home to be worth ten percent less.  Thus if you were to sell, you would "lose" $40,000.  I put lose in quotes because it is really a paper loss.  What you are actually losing is not money but equity or purchasing power.  To this you may say, "No way.  I'm staying put!".  Suppose however that your income and liquid cash would support the dream of yours of owning a 4,000 square foot, 4 bedroom home with a finished walk-out lower level on a large, beautifully landscaped lot.  Last year this home may have been priced at $650,000.  Given that the market for this home has decreased by that same ten percent, the home today could sell for as little as $585,000.  This price may even be lower as the higher end markets are being hit harder than the lower valued homes.  For example's sake, let's say that you are able to purchase the home for $585,000.  That's a difference of $65,000 from last year's prices.  As you can see, you stand to make a net gain of $25,000 ($65,000 - $40,000).  Not a bad deal.  Do you still think you should wait for a "Seller's Market" to place your home for sale?

One very important key to remember in this scenario is to SELL YOUR HOME FIRST!  I know it can be an unsettling feeling selling your home and not knowing where your next residence will be.  However, as long as you sell your home before purchasing, you are in the prime negotiating position...because you don't HAVE to make a move.  Should you purchase a home first, the negotiating power is put into the hands of the potential buyers of your home.  This is because now you have a deadline for selling.  You HAVE to sell your home.  That is, unless you plan on carrying and paying for two mortgages.

If you are working with a Realtor, he or she will put a plan in place while your home is being marketed that makes it unlikely you will be caught not knowing where you will live.  As your home is marketed, you will begin your search for your next home.  The object is to always have a list of two or three houses that you would consider purchasing when your home sells.  And remember, once you accept an offer on your home, you will have 30 - 45 days until closing.  Your Realtor can also negotiate a period of time in which you can stay in your home and pay the buyers rent while you continue your search.  Realistically, you could have a period of as much as two - three months to locate your next home.

Remember, things aren't always what they seem...and the conventional wisdom is sometimes not so wise.  A "Buyer's Market" may be your market.  It may be your chance to find that home of which you have always been dreaming.