What happens when you sell your home soon after your purchase?

I have recently need a good amount of properties go up for sale shortly after the owners bought the house in the Danbury,CT area. I can think easily of about a dozen properties in my market that things didn't work out after their closing and now the owners are in a position where listing their home for sale is a necessary matter. 

Keep in mind the following as part of your decision making process.

-Expense:  There are settlement charges associated with the sale of your home. They include real estate service fee, real estate conveyance tax split between the town and the state, recording fee, and your attorney's fee. You will also have you pay your movers. You will also get back at closing any taxes that is paid in advance and reimbursed for any remaining fuel. 

-Are you are aware of any house issues: When you bought the home, like most buyers, you did a building inspection. Are their any issues that you didn't negotiate with the seller that might be any issue. Get the report out and discuss with your real estate agent if you are considering moving. They should be able to do you what if anything should be done. Most buyers understand they are not getting a new home but we would need to disclose or negotiate any item that is either 

-Have you made any cosmetic improvements to the property? You might not get dollar for dollar on what you invested. However, some improvements many help you by having the house sell faster. Most buyers would want to paint to their color palate. Small projects were OK, but any major renovation such as a full kitchen you might only get about 75 cents back on the dollar that you spent, assuming renovation was done right to market standards. 

- Financial consequences: Speak to your financial advisor especially if we think there is a large difference in value between what you initially invested for the house and what the current market value. You may have to possibly pay capital gains taxes. You will also lose any funds quickly that you paid as the cost to get the house (mortgage, inspection, movers,etc). 

Another financial matter to consider is how long you have lived in the property since your closing. If you've made less than 6 monthly mortgage payments, the lender has to payback the service release premium. If you've purchased the home as a owner occupied property, the bank could claim your move as a flip and could claim you made a false statement on your loan application. Check with your lender and legal council on this. 

-Do you have funds available to secure replacement housing? The purchase of a home is costly.  You will not have access to your homes equity until the house is actually closed. If you are planning a new home on buying at the same time as your closing, make sure you have financial resources available to put down as a down payment on the new house prior to closing, generally 1% due at acceptance and other at least 4-5% at contract signing after inspections.  Usually, you would close on your old home in the Am and then the new home the next day and any equity you have you can have you can have your attorney hold and apply toward your purchase. You will also need to pay up front for your building inspection and some lender costs for your new mortgage.  If you were to rent, it is also typically asked to provide 2 months security deposit & 1st month rent in the Danbury,CT area just to move in, for applicants under 62 years old, again you move in to a rental before the house is closed. Also you will also need to have funds available to pay any vendors for work done at the house. 

-Appraisal: If you have purchased the home that you are in now in the last six months, it is likely that the buyers bank appraisal will use that as one of the comparable for the buyer's appraisal. The buyers lender sends out the appraisal to determine property value. After touring the home, they prepare a report of similiar sales. We have to make sure that there are enough recent sales of similiar properties to support your value.  

Confused over the whole thing? Help is here, serving the Greater Danbury since 2006. Jonathan Hall with William Pitt Sotheby's International Realty, he has helped many clients over the years whose situation has changed and they are forced to relocate. Considering selling your home and need help-feel free to reach out. Contact him at 203.417.0523 or JonathanHallRealEstate@Gmail.Com 

Post last updated 10/4/2022