Thursday 18 Jul 2019
Is it the right time to sell your house?
Have you been flirting with the idea of a new, modern home or gazing at properties you imagine yourself living in? You're probably experiencing those fledgling feelings of desire that put the cogs in motion.
How to know when to sell your house isn't an easy decision to come to. Especially, when your home is filled with cherished memories. More than wanting a new home that checks all the updated boxes, you also need to consider a range of influences that will affect you, from the current market conditions to your own financial circumstances, and more.
Don't sit on the fence any longer. Here are ten surefire signs it's time to sell your house:
1. You've built positive equity
If you've been paying your house off for five years or more, you may have built up a tidy sum of positive equity. Having built equity is one of the best financial factors in deciding whether you're ready to sell up.
Your equity is determined by how much you gain (or lose) when the remaining balance on your mortgage is subtracted from the current market value of your home. To get the best idea of this figure, employ the help of a professional.
Ideally, when you sell your home, what you get back will be enough to cover the costs of the deposit on a new property, the associated costs of moving, and settling a sale. Selling when you have negative equity could leave you worse-off than before.
2. You're financially ready to move
Not only have you got equity on your side, you have extra savings up your sleeve. The costs stack up quickly when selling a house. Try not to rely solely on your equity — it's best to reserve that for your new dream abode.
When asking yourself, "Should I sell my house?", consider the costs of moving, minor (or large) repairs that need to be done before you list your house on the market, and whether your new mortgage will be heftier.
"The guys at the bank want to know that your financials are rock solid when you apply for a mortgage."
The guys at the bank want to know that your financials are rock solid when you apply for a mortgage. Ensure you're debt free and have at least three to six months worth of savings accrued for anything that might come up.
3. You're emotionally ready to move
So, you've got all your financial ducks in a row? Fantastic! Congratulations!
… Not so fast!
Ask yourself, "Emotionally, am I ready to sell my house?" Are you ready to cut-the-ties? A sign it could be time to sell is that you're actively perusing the latest real estate listings and day-dreaming about a new place.
Selling a home is an emotional and stressful process, and emotions can cloud judgement at the best of times. You need to prepare the house for sale and be ready for any negative feedback you may receive from realtors, home stagers, or potential buyers.
This doesn't mean you shouldn't sell! Give yourself time to mentally prepare for all the steps it will take.
4. You've outgrown your home
Did you buy your home when you were single, foot-loose and fancy-free? Before you started up a family? Have you outgrown your home and need more bedrooms and storage space?
Whether you're expanding your family, are finding the kids want their own rooms, or have ageing parents to care for, it might be time to investigate the market.
5. You're ready to downsize
On the reverse, many homeowners are choosing to sell once their children have grown up and moved out of the large, once bustling family home. It doesn't make sense to manage the up-keep anymore.
The great news is that downsizing can provide you with a nice nest egg as long as you are wise with how much of the profit you decide to spend on your new, cosier home.
6. Your location no longer suits your needs
If your home no longer suits your lifestyle needs and you don't find the location desirable anymore, it may be the right time to sell your house.
From considering which schools to send the kids and where the best job opportunities are, to having good options for healthcare, shops, parks, public transport and more, you will want to live in an area where you spend a lot of time and that will benefit the entire household.
7. Your neighbours sold for a good price
Your neighbours just made a delicious bundle of cash selling their home. You've discovered you're located in a seller's market, and it's got you intrigued! It could be the best time to sell a house, and you don't want to miss the opportunity.
Test the market, and find out the estimated value of your home. Get in touch with a real estate agent in your area to get a feel for how much your home is worth and whether selling might be a good outcome for you.
8. Market conditions are on your side
Sure, a local seller's market is a good indication you would benefit from selling. But, on the flipside, if you're looking to buy a new home and upgrade, a buyer's market can actually be more favourable in the long run. You could end up with a bigger home, in better condition, in a more ideal location — for less!
In a seller's market, you could struggle to pay down a new mortgage, need a bigger deposit, and might be limited to what you can afford.
9. Renovations won't add much value
Considering renovating your home in order to capitalise on your resale? Will a renovation actually add value to your property or will you lose money in the long run?
If you spend too much and budgets blow out, you may overcapitalise. Be sure to carefully plan out what your aims are, how much it is going to cost and how much value it will add to your resale.
"If you spend too much on your renovation and budgets blow out, you may be putting yourself at risk of overcapitalising and making a loss"
A new bathroom or a kitchen remodel will certainly add value to your home, but ensure you're going to get out what you put in... and more!
It's always a good idea to have a chat with your real estate agent to see if they believe your upgrades will be worth it — or not.
10. You have a real estate agent
You've checked off a bunch of concerns on your list and you're ready to talk with your real estate agent. If you're serious about selling you've probably already enlisted the help of an agent or are on the hunt.
A good real estate agent will listen to you and be able to advise you of the best outcome you can achieve. They will be able to help you put together a plan for selling and outline all the steps you need to take to get your house listed.
If you have your finances in order, are up-to-date with the current market conditions and are saying yes to a number of these signs, selling could be a very beneficial experience for you and your family for years to come.