TASTY
HOW TO KNOW THE TIME IS RIGHT TO SELL YOUR HOUSE OPENDOOR.COM
Before you stake a “For Sale” sign in your yard, consider these five factors as you decide whether it’s the best time for you to sell. Image source: https://artesiantitle.com/
1. Your finances Personal finances are often a driving factor behind home sales. If you’ve occupied your home for several years, you may have equity you can use as a down payment on a new home, to supplement your retirement, or to pay for other big expenses. As Marketwatch explains, if the house you’re selling is your primary residence, and you’ve lived in it for at least two of the past five years, you won’t pay capital gains tax on the first $250,000 (single owner) or $500,000 (married owners) on the “gains” from the sale. Another financial factor is whether you have enough cash flow for the costs associated with moving. According to the American Moving and Storage Association, the average cost of an intrastate household move is $2,300, while the average cost of an interstate move is $4,300 (average distance of 1,225 miles). 2. Life changes We can’t always plan for life’s biggest changes. Sometimes things arise, and you realize you need to sell your home quickly and move away. A few examples of circumstances that might trigger such a move are: A new job Aging parents who need your help Placing your kids in a better school district A medical condition that requires living near a specialty hospital, or accommodations such as trading stairs for a single-level home Selling on a short timeline can be stressful, but there are ways to ease the process. If selling traditionally, consider selling the house as-is. You’ll price the home a bit lower in exchange for not making any repairs, which can be costly and time-consuming. 3. Upgrading or downsizing Sometimes a home no longer suits your needs or lifestyle. Maybe your family has outgrown the number of bedrooms, or your pets need a larger yard. Perhaps you need office space to launch a home-based business. The decision to sell your home and upgrade could be spontaneous. More likely, it will require time to consider exactly what you want before you take the plunge. Walk around the house and take inventory of the spaces you use and how they meet your needs. Are closets overflowing? Is the kitchen cramped? Do you need another bathroom?
4. Seasonal changes in real estate Personal factors aside, sometimes it’s best to sell your home during peak months to take advantage of higher sales prices. If you’ve been on the fence about selling your home, the calendar could be your guide. Nationwide, home sales tend to pick up in February, increase even more in the spring, and peak in the summer, according to the National Association of Realtors (NAR). But the pattern could vary according to your geography. For example, thanks to the mild winter weather, home sales in Phoenix hold fairly steady yearround, spiking in March and again in May. Sales in colder climates might spike later in the summer. Make sure that you do some research and familiarize yourself with the current trends in your local market. NAR and Realtor.com have helpful research sections, among others. Additionally, talk to a seasoned real estate agent to fully understand how seasonality impacts your local real estate market. If possible, consider deferring the sale of your home a few months to take advantage of most favorable conditions in your locale. 5. Other housing market factors There are other market factors to consider besides seasonality. One of the biggest is the inventory of houses for sale in your area. Low inventory means it could be a good time to sell, since buyers may clamor for any available properties and may be willing to pay top dollar for your home. If you’re curious about the inventory in your area, Realtor.com offers statistics about regional home sales, including median sale prices, the number of active listings, and days on the market (DOM). The DOM tells you how many days the home was on the market before it sold. A low DOM can signal low inventory and higher sales prices. Another consideration is mortgage interest rates. When interest rates are low, buyers are motivated to take out mortgage loans. More buyers mean more sales, which could translate into less time on the market, or more money, for your home. Similarly, buyers are motivated when they are worried interest rates might go up soon. Sites like Kiplinger will forecast these interest rate hikes based on the activity of the Federal Reserve.