Is This You? 5 Signs It's Time to Sell (yes in the fall)
Signs you should sell the house: How to listen to the market, analyze your financials, and figure out what’s next
“What’s your long-term plan? Have you identified where you want to move once you sell? Are you moving up or are you moving down? Are you moving out of the area?”
Whether you can’t keep up with your mortgage or your house has skyrocketed in value, these are the sure signs that now’s the time to sell—don’t hesitate another minute to get the ball rolling.
1. You’ve seen strong home price growth in your area for several years and the market generally favors home sellers.
As they say in the world of stocks: buy low, sell high. You bought a house with the intent of building wealth. Sell it at the opportune moment and you could push your potential windfall from this investment to the ceiling.
For this strategy to work, first you need to understand how the value of your house fits into the larger housing market picture.
NAR puts out a monthly existing-home sales report that shows the state of inventory across the nation and breaks it down by region. Inventory refers to the number of homes for sale on the market. “Months of supply” of inventory represents how long it would take to sell all those homes up for grabs. If your market drops below 3 months worth of inventory, seller’s have the clear advantage, putting you in the position to command a higher price and make few to no concessions.
In a steady housing market, homes appreciate at a clip of 2%-3%. If you’ve held onto a house for 5-10 years with that kind of growth, you could be in a good place to make a move.
The bottom line is you want to ride a home price run-up as long as you can while values are still at their peak, collect your maximum proceeds before prices cool again.
2. Your sale lines up with local seasonal trends and buyer behavior in your market.
Believe it or not you can tweak the timing of your home sale even closer to perfection with clues from real estate transaction data.
Traditional wisdom has it that the best time to sell your house is in the spring when the weather warms up and buyers come out in force—and this is true in many markets. But seasonal trends differ from city to city, so you could benefit from a fall, summer, or even winter sale depending on the weather, competition from other sellers, and buyer behavior.
Typically a small inventory of Austin homes in the fall makes it a sellers market. Check with a real estate in your area to see if that holds true for your neighborhood.
3. Making ends meet every month feels like a stretch.
Your mortgage is just one expense of homeownership. Property taxes, home insurance, private mortgage insurance (typically between 0.50% and 1.2% of your loan amount), utilities, household maintenance, lawn care and other fees can strain your finances.
This can vary depending on where you live, as well as the size and age of your home. But consider: If an average home costs more than $360,000 (according to the U.S. Census Bureau), you could pay an additional $1,204 a month—or $14,448 annually—for these other expenses.
And that’s not considering maintenance costs that arise from a leaky roof, faulty AC unit, or broken appliance. It’s advisable to set aside 1%-3% of your home’s purchase price each year in a separate savings account specifically for such maintenance and repairs.
Unfortunately, not everyone can keep up with all the costs or would rather not be house rich, cash poor. If you find yourself spending more than a third of your income on housing costs, it’s a big sign that you’re overextended.
4. You’ve outgrown the house and are in a financial position to trade up.
The opportunity to relocate to a new or better home is the no. 1 reason Americans move, according to a study by Move.org. And as one of the main benefits of homeownership, many buyers use the proceeds from their old house to comfortably purchase their next one.
However, before you sign up for a bigger mortgage in a snap decision, crunch the numbers to make sure you can afford your next residence when the dust settles.
Look at equity - do you have enough money to sell it and have a good-sized down payment for the next property? Or can you walk away after selling, and get similar financing on the next home?
The nice thing about being able to put 20% down on your next home is you’ll be able to avoid private mortgage insurance. Take your price range down a notch, keep your down payment the same, and you can shave off the cost of insurance from your monthly payments.
To find out what your home is worth, the Amazing Realty Home Value Estimator pulls data from several leading sources to get a real-time value estimate based on current market trends.
5. Maintenance keeps getting away from you or you’d like to age in place longer.
90% of retiring homeowners want to age in place, but Americans notoriously wait too long to downsize or switch to a house that better meets their needs later in life. Seller generational trends from the National Association of Realtors show that 67% of people who moved between the ages of 53 and 92 did so for a health-related concern.
If the time has come when you no longer can deal with your home’s maintenance demands and would like to stay in your personal home until later in life, it’s time to sell the house and look for one with the right floor plan, style, and features for senior living.