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Friday Blog, October 17, 2008 - I hope you are enjoying this Friday as another week comes to an end.  Yet another tumultuous week in the stock market, ending with interesting news from the Housing Market.  Yes, the New Housing Starts Report is in and numbers are down (surprise, surprise).  There are not too many builders wanting to start building projects when buyers are sitting on the fence.  As a result, housing starts are at an all time 17 year low – WOW.

Again, the question always goes back to “What does that mean for Main Street or You?”  In my email to you last week I discussed the reasons why you would want to buy in market like today.  This week I promised to address reasons why you may want to sell in a market like today….and after today’s report you may think there really is no reason.

Well, obviously if you are moving out of state – maybe due to a career move, maybe to move closer to family, maybe to move farther from family.  These are all “have-to” sell type scenarios.  Thankfully, The Castles By Chrissy Team can help you do just that - quickly and efficiently.

But what if you happen to fall into the category where you don’t have to move right now.  You’re thinking basically lies in the area of – it would be nice to have a shorter commute, it would be nice to have an extra bedroom, it would be nice to live in a neighborhood with lots of children, it would be nice to have a basement for your husband to hang out, etc, etc.  Should you wage your bets and try to sell now or do you wait 2-3 years and hopefully let the market rebound.  The math is really simple and when you see it laid out in front of you, you may understand why now is better than ever.

Say you live in a $250,000 home and you want to buy a $500,000 home.  The market is down 5% right now – so you can expect to sell your current home for $237,500, which then means you can expect to purchase your new home for $475,000.  This is approximately a $12,500 savings to you.

Or you decide to wait it out for 2-3 years and thankfully the market rebounds and appreciation is up 5%.  Your $250,000 home can sell for $262,500 but now you are paying $525,000 for your new home.  Essentially this move is costing you an extra $12,500 to move.

Doesn’t it make more sense to sell for a small loss and realize a large gain versus sell for a small gain and buy at a large loss?  The numbers only increase in your favor in higher price ranges.  So the answer is a big YES, YES, YES!!!  Go ahead and take a small loss – your return will be so much better!

The other big factor is we actually don’t know what is in store for us over the next 2-3 years.  We hope the market rebounds, but what if it doesn’t for more like 5-7 years?  What if interest rates start to creep up?  What if the value of your home actually falls below what your payoff is?

Again, doesn’t it make more sense to sell now while things are still relatively stable?  Your ARM hasn’t expired yet and your home value is actually still pretty good?

I definitely admit that selling now may not be the best scenario for everyone.  That is what I am here for – I am your real estate expert.  This shifting market is not new to us and we have mastered the tricks of selling in a market like this.  Please use us as a resource.  I would love to set up a consultation with you to discuss what might be your best options – free of charge!