Most of you know that the real estate market has been on a solid upward trend for many years now... in some areas we've seen close to 10% growth year over year. It has been crazy to watch, and the question I am most often asked is, where do I see the market going? Ah, if only I had a crystal ball....
That in itself I could write all day about, and while there's signs certain markets and price points are shifting and slowing down, we are still seeing dozens of offers on some homes (I mean, even in the midst of winter!) - especially on move-in ready homes in entry-level price points, in any area. Unfortunately, the reality is we won't really know the market is going down, until it is.... But history tells us it's bound to at least stabilize eventually, and can't sustain this kind of growth forever.
What I can say though is that if you're someone who bought in the last 10 years, and starting to think about the next move, from a condo in the city to a house in the suburbs, or just a bigger house... now is definitely the time to start exploring your options and taking advantage of the
equity you've built. I sold my condo and bought a home myself this past year, and wouldn't have had nearly the buying power if values hadn't increased as much as they have since I bought in 2012. It was great to experience on my own, because these days I work more and more with clients a second-time around also in this delicate situation of buying and selling simultaneously.. and as daunting as it can be, especially in a strong market where having any sort of sale contingency is difficult - it's also an amazing opportunity to capitalize on your equity and get into your next home.
So what are some of the next steps, if you've started to think about a move?
- Figure out your home's current value. Most of you have probably checked Zillow's Zestimate and kept an eye on neighborhood sales, but having a real estate agent walk through and help review the market is the best way to determine a realistic ballpark of what your home may be worth, as well as things you should consider doing to prepare in meantime.
- Speak to a mortgage broker. Can you afford to hold both mortgages at once, and if so; what are your down payment options? Selling will almost always be the easy part, but by being able to qualify without selling, you'd be able to find a home and make an offer before, and without any contingency... and then list and sell immediately after. Don't be afraid if you don't have a down payment - more and more banks are offering "bridge" like options to help you if you have built up equity.
- If that's not an option, think back up plans. Can you sell and and then rent or stay with family short-term? In this market we often can also find buyers with some flexibility to allow a seller to stay a little after closing as well to buy some time.
- Consider taking out a HELOC - a home equity line of credit. This could essentially be your down payment ready to go; it's just a line of credit that doesn't accrue interest or payments until it's withdrawn. I took mine out through Citizens Bank, but you can do so through your own bank, shop around or through the mortgage broker.
- Decide if you're ready to take the leap, because I can promise you with all your ducks in a row, it is possible!
Of course, call me anytime... whether you're thinking to do now or in the coming years, it's always good to get the conversation started so I know to keep you in the loop on the market, and tell you more about how I did it myself!
