Understanding Why & When To Sell Your Home
As I’ve previously stated, I believe 2021 will continue to remain a buyer's market. However, despite these conditions, I want to turn this around and now discuss why and when you should sell, even in a market that favors buyers. Here are the reasons you may want to consider:
No. 1: Life plans
I always tell my clients that you can’t let real estate get in the way of your life. So what does that mean? It means you can’t always time the market perfectly when life events happen. You get pregnant, you get divorced, you want to move to the suburbs. These major life events happen and are more important than worrying about obtaining top dollar on your sale. Hence why I say don’t let real estate get in the way of your life. Your sale price is not the be all end all and if it turns out to not be a great investment. I feel confident that you will recover and make it up somewhere else further down the line.
No. 2: Upsizing
A great time to be a seller is when you’re also a buyer. If the market is down you are not going to get top dollar for your home, no question. But the same can be said about the owner from which you are going to be buying. And if the market is down a certain percentage, you are going to be making up for that percentage and them some on the acquisition of a bigger home. In other words, if you’re leaving 10% on the table on a $1,000,000 sale, but you’re making up 10% on a $2,000,000 purchase, then you’re actually net positive $100,000. In this case, it makes a lot of sense to sell your home and buy the bigger property.
No. 3: Equity reallocation
Similar to taking advantage to an upsizing opportunity, you should sell when you have a chance to deploy the equity you’ll retain from a sale into another investment that makes sense for you. If you’re a big believer in Bitcoin but need that cash, then sell. Investors buy and sell assets all the time, don’t be afraid to sell if there’s another opportunity in which to park your money!
No. 4: Long-term hold
Like many investments, if you’ve held onto your home long enough and built up the equity and value, it’s usually not a bad time to sell. Purchased your loft in 1992 in Tribeca when no one else would? Well, I’m pretty sure you’re going to do OK when you sell. As I said earlier, you can’t always time the market so if it’s the right time and you’ve owned for a long period of time or just happen to purchase the home at the absolute perfect time, then selling isn’t a bad play.
Do you agree with these reasons? Did I miss anything? Feel free to add a comment and let us know your thoughts.
