Buying Up in a Down Market

So you want to – or need to – sell your home in a down market. You are probably concerned that –

  • Your home won’t sell at all.
  • You’ll end up getting much less than it’s worth.
  • You might miss many other less-than-market-price houses while waiting for your property to sell.

I hear people say, all the time, they need a bigger house but they are going to “stay put” until the market values go up again; then they will sell their house so they can net more and have more to put down on the bigger and more expensive house.  Let’s think about this plan.  I’m located in the Tulsa, Oklahoma area, and in the last year we have seen a decrease of about 2% of market values.  So, for the sake of my market area, that is the figure I will use.  I have kids and grandkids and we like to play pretend so let’s pretend I have a house that is valued at about $100,000.  Well, that’s easy.  2% of $100,000 is $2,000.  So, hypothetically I would realize $98,000.  Okay, let’s say I’m going to purchase a house that is valued at $175,000 (2% of $175,000 is $3,500) which means I would purchase the house at a reduced price of $171,500.  In a down market, I sold my house at a fair price, I purchased the house I wanted or needed and I did it at a gain of $1,500 over what I would have done in an up market.  This is, of course, just a hypothetical scenario but you get the idea.  So, just do it!  Call your Realtor, get your house ready, staged and go!

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Published in: on August 10, 2010 at 1:13 am  Leave a Comment  
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