Should I Stay Or Should I Sell My House?
Should I Stay or Should I Sell?
Reminds me of the old song "Should I Stay Or Should I Go Now. If I go it will be trouble but if I stay it will be double."
It's first quarter 2020 and the real estate market has been good for going on 8 years now. Wow, that's a long time and some project the market to shift again soon. But...hold tight...is that really the best indicator whether to sell or buy a house?
Yes, buying low and selling high is very important. What about for most of us who already own a home? Let's run some numbers and see what makes the most sense.
Running the numbers -
If someone decides to wait to buy a house -
Home prices today $300,000 Interest Rates today 4%
They wait one year and buy next year - 4% appreciation Home price $312,000
And let's say the Interest Rates stay the same at 4% Total extra payments $21,000 over 30 years due to the 4% appreciation of the home.
Here is another example I think I’m going to wait to buy?
Let's assume Home price today is $300,000 Interest Rates today 4%
We decide to Buy next year - and the home price does not change. It's still $300,000 next year.
But the Interest Rate goes up to 5%
This will result in Total extra payments of $64,210 over the next 30 years
Here is another example - Home prices go up 4% and interest rates go up from 4% to 5%
Home prices today $300,000
Interest Rates today 4% Approx $1541 / month...