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Why Now May Be a GREAT Time To Sell Your Home (Yes I know what everyone else says)

Good afternoon Real Estate Professionals.  I wanted to share this blog written by my buddy Leander McClain.  He is a Real Estate Agent in New Jersey and is always posting useful information.  If he is not showing a customer why its still a good time to sell and buy real estate, then he is telling them what's going on in Jersey this weekend (with driving instructions) - oh yeah and a blog about the "Man Cave"..

This particular post is filled with great information, including a breakdown of the homeowners 'loss' in value to their current home, but a 'gain' in value to their new purchase.  Do you currently provide this to your customers?

These days it seems that most Realtors are focusing buyers.  Many agents do not want the task of selling a home in this market.  You hear..."it's a great time to buy a home", it's a buyers market, "there are too many sellers and not enough buyers".  Well I am going to make the argument that NOW may a great time to SELL your home. 

 

Let's make a couple of assumptions.  1) Your current home is a 4 bedrooms, 2.5 bath, 1,500 square foot home in a nice neighborhood.  Two years ago, your neighbor sold the identical home for $250,000.  Data suggests that home prices have fallen in your area 10% over the last two years.  You are interested in a larger home (3,000 square feet) and this home sold for $400,000 two years ago. Data suggest that home prices have fallen in this area by 10% over the same 2 year period.

 

Right off the bat, the data in table one suggests that you receive $25,000 less for your home.  However, there are some positives.  Based on a 6% commission rate, you will save $1,500 on real estate commissions.  You will also save another $375 on closing costs (based on 1.5% of selling price).  To sum it all up, you will receive $23,125 less for your house than if you had sold it two years ago.  Now here is where most people stop...and they don't get

THE REST OF THE STORY.

 The house that you want to purchase has also faced the same price drop.  The home that would have sold for $400,000 is now ON SALE for $360,000.  Right away, you are saving $40,000.  You will have to put down $8,000 less for a down payment and your closing costs will be $1,600 less.  Overall, you will be paying $49,600 less for this home.  That is almost $50,000 in your pocket.

..but not so fast slick

Remember...you just lost $23,125 when you sold your old home. In the end, you will end up on the positive side.  Your gain on the purchase of the new home will offset the loss you faced when you sold your old home. 

 In this example, the homeowner saved $26,475, is living in a home that is twice the size of the old one and paid less/square foot.  So the next time someone tells you that this real estate market is only good for buyers.....tell them,  "not in all cases"

 Have a great day.  I will be out here in Burlington Township, Burlington County, New Jersey trying to round up some sellers that like a good sale.

 

Leander McClain,

Realtor & Real Estate Consultant,

Exit Buyers Plus Realty, 15 E. Broad Street, Burlington, NJ 08016

609-505-6578

 

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Are you looking to purchase a Texas home?  Perhaps you love your Texas home but would be interested in refinancing your Texas mortgage to a lower interest rate?  

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Texas Home Loan Expert

Frisco TX Mortgage

      

 

The views expressed on this site are mine alone and do not reflect the views of my employer.

Comment balloon 4 commentsJohn Cannata • September 23 2008 12:03PM

Comments

John, That is a really positive way to put a spin on something that could otherwise be an awful situation.

Posted by Marchel Peterson, Spring TX Real Estate E-Pro (Results Realty) about 11 years ago

That was my thought as well Marchel.  I have heard it explained differently and felt that Leander's example was very clear for the homeowner.

Posted by John Cannata, Texas Home Mortgage - Purchase or Refinance (214-728-0449 http://TexasLoanGuy.com) about 11 years ago

The obvious is always hidden right before your eyes. Excellent selling tool.

Posted by LS Rogers Realty (LS Rogers Realty) about 11 years ago

Exactly Trunda.  The way he presented it was very clear why it would be a good tool.

Posted by John Cannata, Texas Home Mortgage - Purchase or Refinance (214-728-0449 http://TexasLoanGuy.com) about 11 years ago

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