We constantly hear the expression, "It's a buyer's market." Does that mean sellers are always at a disadvantage?
Not necessarily. Sellers that are moving up to a higher-priced home have a great opportunity to save money. For instance, if they take 10 percent less for the sale of their $200,000 home, they've "lost" $20,000, but they will get that same savings or more on the new, higher-priced home they are purchasing.
So when they purchase their new $300,000 home for 10% less, they will then "gain" $30,000, and actually be ahead $10,000-something that would not be possible in an "up" market.
Another reason for selling in a down market is to quit "throwing good money after bad". If you are living in a dwelling type or area that does not have the appreciation potential of another home that you could be in, it's similar to holding onto a bad stock and waiting for it to go back up, when you could sell at a loss but then buy a new, better stock and start seeing your value increase right away.
Similarly, once you sell, you can move into a home that has higher future appreciation potential. Moving from a two-bedroom, one- bath home to a three-bedroom, two-bath, from a less desirable school district to a more desirable one, or sometimes from a condo or townhouse to a single family home are all ways you could affect your future home appreciation. And you can take advantage of interest rates that are well under 5 percent!
Another reason to sell in a down market-sometimes you can't put a price tag on starting the lifestyle you have been dreaming about! Perhaps the thought of raking leaves and exterior maintenance is weighing you down. Why not sell now and start living in the condo or townhome of your dreams? Maybe you've always wanted a gorgeous garden. There's a beautiful cottage somewhere just waiting for your green thumb. Bottom line -- the real estate market is what you make of it.
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