A typical homeowner who is looking to move up in the real estate world will typically spend about 25% more on the home they are purchasing. For example, a home owner who is selling a $285,000 will then be looking to buy a home worth approximately $355,000.
Now think about this - if you are in a down market and the property values have come down about 10%, that would mean your home once vauled at $316,600 (which is now $285,000) has lost about $31,000 in value. However, the home you are planning to purchase for about $355,000 was once worth about $394,500, and has experienced a loss of about $44,500.
Furthermore, if you choose to wait until the market begins rising, then the more expensive home will rise by more dollars than your existing home - therefore you will not experience as much of an equity gain if you stay put until the upswing has already begun.
Consider This! This is a great time to buy new construction. Buyers are realizing even more benefits when purchasing new construction because many builders have not only cut prices by the areas market price declines, but they are also willing to include more options as incentives because they can do so at a reduced cost to themself - delivering a greater benfit to the buyer - for instance, a typical $3500 fireplace upgrade may actually only cost the builder $2,500 - thus the builder is giving up less than the buyer is actually gaining. This becomes a win-win incentive program.
If you have any comments on this Blog, please present your comments. If you are interested in long-term equity growth, don't hesitate to call me at the office which is 856-222-9030.
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