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

Buy next year - 4% appreciation Home price $312,000

Interest Rate from 4% to 5%

Total extra payments $85,402 over 30 years or $1784 / month

$233 extra per month if we wait one year

 

What if?  Buy next year - 4% appreciation and the interest rates go up from 4% to 6%

Home price $312,000

Interest Rate from 4% to 6%

This will mean an extra $145,900 over the next 30 years. or Monthly payment $1979/month

The key is to learn all the facts when making the decision to sell your house.  Consult a top realtor and have a FREE consultation. Waiting can be a great plan.  It also can be one of the most costly mistakes for your wealth position.  It's very important that you learn the facts.  Most economists agree the interest rates are the most important factor when considering selling and buying.  Obviously this is after the life factors are considered. If life is not allowing the move (ie. job, family, church, etc.) is too busy currently...then this moving thing should take a back seat to your life. 

 

What about the first time home buyer who wants to get started on the 'right foot' with the best price possible?  First time home buyes should monitor home prices and interest rates.  Ultimately, though, interest rates will 'trump' home prices so when interest rates are very low it's a great time to buy a house.   With this, finding the right realtor to help you navigate and find the best house and negotiate the price,  terms and closing costs is something that is VERY important.  A weak agent can cost you a lot of money!