Timing. When it comes to selling your large home, razor-sharp timing can make the difference between moderate equity and ample resources for retirement, investment, and/or college tuition.
But how can you locate and track the information you need to sell at the peak of the market?
While there are myriad resources, three indicators can assist even the financial novice in interpreting market conditions:
Comparable properties: Hire a real estate consultant to track the listing and sale of comparable properties like yours. By the time you’ve received information over two to three months, you’ll be able to track the following:
- a. Are the pace of sales picking up? If so, it could indicate a shortage of available properties, thus as increase in overall prices.
b. Are sales slowing down? If so, it could indicate that the market has peaked for your type of home and it could be wise to sell quickly to maximize profit.
c. Are prices beginning to soften for homes comparable to yours? If so, this could also signal a peak in the market and a signal to sell now or wait (possibly years) for the price to plateau again.
Interest rates and the overall stability of the economy: Once rates begin to rise markedly, it decreases the number of potential buyers for homes which has often has even greater impact on the purchase of homes on the higher end of the price spectrum.
Here’s why. Many potential buyers for large homes are those moving up either due to expanding family size or increased financial affluence. In ether case, higher interest rates mean higher monthly payments, parting with larger down payments and paying more closing costs. Couple that with the fact that rising interest rates will impact the speed at which move-up buyers can sell their current home, and you’ve got a potential market gridlock.
In the third installment of this article, we’ll view the impact of the general economy on selling your large home and show you how tracking the home affordability index can empower you in deciding when to sell.
( How to Sell You Big Home ) Part I