Finally the mortgage rates came down again. Not that we haven't been at an historic low already. The last couple of years showed such a tremendous increase in property appreciation that actually we priced ourselved out of the market. Let me explain:
You bought a house in 1995 for $ 200,000. The house appreciated an average of 10 % per year. So, in 2005 the market value was 400,000. But when you sold in 2008 the buyer gave you an offer for $ 350,000 saying they like the house but cannot afford to go any higher.
Now, you are still making more than $ 150,000 profit. That is still pretty good, but it took you 120 days to obtain an offer, because there were not many buyers out there in your price range.
Did your income increase 8-10% over the last 10 years? Well, mine did not and either did my husband's.
More homes in the $200,000 price range were sold this year in the Fox Valley than in previous years. That is still the price range most buyers can afford.
Over-extending ourself by purchasing more home than we can afford has never been a good idea.
A real estate consultant can help you on the sale and the buy -side. I do this every day, with sellers who are hit by the economy or go to troubled times in other areas. Life happens and my job is to recommend solutions.