Good time to sell or to buy
The reason to sell or buy real estate should be the need to do so. Either you moved due to work, you have a loan that will reset and you won’t afford it any longer (although you can also try refinancing), or you’ve got a bigger income and can easily upgrade to a larger home.
Don’t sell or buy real estate just because you’re afraid of the market. That’s my opinion for the everyday person - not the investor.
I got a call from a friend on Friday morning. He has a home improvement company and basically he was sitting with a friend/client of him, and they wanted my opinion whether she should just put her townhouse on the market without any improvements. According to what they said, it needed at minimum painting, rugs. Her philosophy was just get rid of the house without paying any extras. And my answer for that question was my stats show things selling below 10% of the inventory in my area, around 5.5%. That means if the market is faster in Jan than Dec, your chance to get picked will be around 10% i.e. the buyer will choose one, leave nine listings. Would someone then pick a listing with no improvements or updates ? In most cases, upgrades will only help you sell the listing and you will not recoup any of its expense in today’s market.
And the second question that hit me is really whether she should sell now or no? And my response was the same as above, if you don’t need to sell - then don’t (again not for the investor).
So what about investors versus the everyday person? Most people should in the housing market for the purpose of living in the home i.e. long term players. The housing market changes, because it is a market and those changes and variations are much slower than the stock market. However, there are another category of people who make living by buying houses/homes and reselling them, and those are the investors. Buying and selling in a short term involves risks. For example, you buy a distressed property and did your do diligence in terms of inspection. However, not every single flaw will be discovered by inspectors as some are hidden and may be not even the previous owner knew about it. Sometimes an investor will decide to sell to cut his losses short and exchange the property for a better investment, after all he will neither live in the first nor the second. That’s why I wrote between parenthesis that selling the property in a low market is not a good idea for the everyday person but might be a good idea for investors.
Technorati Tags: sell, buy, bad market, investment, investorTags: bad market, buy, investment, investor, sell
