Everyone wants to know what the real estate market is going to do over the next 6 months to a year. They want to know if THIS is a good time to sell their house or if THIS is a good time to buy a house, or if this is a better time to just sit tight and wait.
As your local real estate expert, I can tell you that the market definitely plays a role in making good real estate decisions. For the most part, selling your house just for the fun of it in a strong buyer’s market is not going to yield you the same results as selling your house in a strong seller’s market. The law of supply and demand tends to work just as you’d expect it to in the real estate market. If lots of people are selling and buyers have lots of homes to choose from, then that’s good news for buyers and less-good news for sellers.
However, what the real estate market is doing – or is going to do in the near future – is not necessarily the most important factor you should consider when deciding to buy or sell a house. What matters even more is what is going on in YOUR life.
Here are some common reasons why people choose to buy or sell a house:
- They are getting married.
- Their family is growing.
- Their kids are getting older, and they need more space.
- They want to move to a house in a better neighborhood.
- They want to move to a house in a better school district.
- Their kids have moved out, and they need less space.
- They got a job in a new city/state and need to move for that job.
- They want to be closer to family in a different city/state.
- They want to go to school in a different city/state.
- They want to move to an area with a lower cost of living.
- They have always loved and wanted to live in a different city/state.
- They got a new job or a raise, and now they are making more money.
- They lost their job or changed jobs and are making less money.
- They want to retire somewhere else.
- They want or need to downsize.
- They are getting divorced.
- They suffered a loss.
- They want to invest in real estate they can either fix up and re-sell or hold onto and rent out.
Is it a good time for YOU to buy a house?
Maybe you found your reason or reasons for wanting to move on the above list, or maybe you have a different reason entirely. Either way, here’s how you can determine if this is the right time for YOU to buy a house! Ask yourself the following questions:
- Will it make life better for me and those I care about?
Will having more space or less space or a home in a different city or neighborhood or school district make life better for you and your family? If so, how urgently do you feel the need or desire to make that happen?
- Can I afford it?
Do you have enough money saved up for a downpayment and closing costs? You typically need 3% to 5% of the purchase price for a down payment, depending on the loan program, and another 3% or so for closing costs, but some loan programs can bring that cost down; talk to a trustworthy loan officer to determine the best loan program and scenario for you and to determine the loan amount for which you can qualify.
- Can I continue to afford it?
Is your job secure enough that you can depend on making enough money to cover the monthly mortgage payment? Do you know how much that monthly payment would be, and do you feel comfortable spending it each month? You can always ask us or your loan officer for help in determining the monthly mortgage cost on any purchase price!
- If I buy a house now, will I have money left over for emergencies and other important things?
Spending every penny you have on buying a house or signing up for a monthly payment that puts too much strain on your monthly budget will undoubtedly leave you feeling stressed out when emergencies or unexpected costs arise. Our advice: don’t do it!! If you won’t have money left for emergencies or the other important things in your life if you buy a house right now, then it’s probably better for you to wait a little bit and save with intentionality. If you know you really want to buy a house soon, then talk with a trustworthy financial planner or go over your finances on your own and make a plan for how you can best save your money so that you are ready to make your house-buying dreams come true sooner rather than later.
Is it a good time for YOU to sell your house?
Maybe you’re not concerned so much about the best time to buy a house because you first need to figure out if it’s a good time to SELL your house. Can it really be both a good time to sell AND buy a house at the same time?? The answer is yes!
Again, the housing market only matters to a point when considering if it’s a good time to sell. If you’re thinking about selling but want to make sure you aren’t throwing away money by selling at the wrong time, ask yourself the following questions:
- Do I need to sell?
Maybe you need to move to a different area for your job, school, family, etc. Maybe something awful has happened, and you need to sell your house because of a loss or divorce or staggering debt you need to pay off. If you NEED to sell, then you need to sell, so let’s work together on determining the best strategy for making your home the most attractive to buyers and you the most money from the sale instead of worrying too much about whether the market is good for selling.
If it turns out you don’t really HAVE to sell and it makes more sense for you to lease your house out instead, we can certainly help you with that too! If it turns out you really do need to sell but your house has gone down in value since you purchased it, we can help with that too! In any case, as your local expert real estate team, we can guide you through this complicated season if you find yourself needing to sell your home or lease it out, no matter the circumstances! We are here for you, and we can help you!
- Will it make life better for me and those I care about?
Will selling your house right now to cash out and rent for a little while so you can either pay off debt or invest the money elsewhere make life better for you and your family? Or will selling your house now so you can buy a bigger or smaller or better house or a house in a different neighborhood or school district or a house with a more functional yard make life better for you and your family? If so, how urgently do you feel the need or desire to make that happen?
One More Note About Timing
Remember, if you are selling your house when the market is down and you are planning to buy another house right after selling, then you will likely be buying in the same lower market. You may not get as much for your house as you would during a strong seller’s market, but you also won’t pay as much for you next house as you would in a strong seller’s market. The same is true if you sell when prices are high; you’ll make more money off your sale, but if you plan to buy again right away, you’ll pay more for your next house than you would have if housing prices were lower.
One Last Word About Timing
As a long-term investment, real estate tends to go up over time, even accounting for market dips and crashes at certain points. Generally, getting into the real estate market sooner rather than later gives you greater opportunity to start growing your investment and gain equity sooner.
So, when is the best time to buy or sell? It has less to do with the real estate market and a whole lot more to do with you and what’s going on in your life!
If you want to find out more information or talk further, give me a call at (626)328-4199 or send me an email at firstname.lastname@example.org. I’d love to talk with you!