Put Time On Your Side
I suspect you have heard these words before. If you have influence over the timing, the following suggestions can help you make the most of it. Timing can impact you both positively and negatively. There are many variables that will affect the timing of your purchase or sale. Each of your considerations can be placed into one of two categories: market conditions or personal circumstances. An objective evaluation of your personal circumstances and market conditions will allow you to make a more confident decision regarding the timing of your purchase or sale.
Under The Circumstances
No matter what the market conditions are like, usually buyers and sellers first consider their personal circumstances before making their decision. Your decision of when to buy or sell is most often dictated by circumstances as financial ability, emotional status and time constraints. Here are some specific events that may influence your timing:
• Marriage or Divorce.
• Employment promotion or transfers.
• Serious injury, illness or death in the family.
• Conflicts with neighbors or landlord.
• Desire to improve.
• Need for a tax shelter
• Children move out
• A new baby or a graduation.
These and many other individual occurrences have an impact on your decision to buy or sell. Whether negative or positive, each of your personal details should be considered.
It is smart to be measuring your motivation. By this, I mean considering your entire situation you may be able to more accurately determine how practical it is to buy or sell. You should evaluate your financial ability, your individual needs and your personal desire. It is the overall interpretation of a combination of your present circumstances that will help you draw the right conclusions. The equation below assists in depicting this concept:
ABILITY + NEED + DESIRE = MOTIVATION
Who Knows What The Market Is Like. Really?
The real estate market is the other factor to examine. Knowing the market will often affect when you actually make the move. A retiring couple, for example, may have time to consider market conditions particularly thoroughly before deciding when to sell their home. Whereas, a homeowner who is transferring probably will not have that luxury.
When analyzing the best time to enter the real estate market, there are many factors to consider. Here are some general thoughts on the key market conditions to be aware of. In addition to real estate agent, talk to different people who have knowledge about what is happening in your particular market. Examples of suitable contacts who could have unbiased observations are title company employees, mortgage lenders, home inspectors, real estate attorneys, real estate appraisers, municipal employees in a certain court house function (register of deeds) or other sources with access to credible information. A real estate agent can be a reliable source if they provide actual uncensored MLS data that you both dechiper together.
What Information Should I Be Looking For?
It is particularly helpful to obtain an understanding of the current market conditions in your area in order for you to decide the importance of market conditions. The key market considerations are:
Fluctuations in interest rates: waiting for interest rates to rise or fall should not be your only consideration. Declining interest rates can create a “seller’s market” and your interest rate savings may be offset by an increased price. Conversely, rising rates can give way to a “buyer’s market” as the number of qualified buyers decreases. Waiting for interest rate fluctuations may not be a chance you want to take.
Average market time: sellers should be aware of the average length of time it currently takes to sell a home. Buyers may want to compare present averages with prior norms. The average market length can be an indication of a “sellers or buyers market.”
Current and future economic trends: The area’s employment outlook, property taxes and other community factors, such as school district effectiveness should be considered. A leading company layoff or constant property tax increases in a certain community can negatively affect the market in that area.
The law of supply and demand: By considering the number of competing properties versus an estimate of the number of people looking, you can get an idea of the current balance between supply and demand.
Is Timing Important To You?
There are many aspects to consider before deciding if the time is right to buy or sell. After you have reviewed this information, you may want to make up a personalized list of pros and cons. Discuss market conditions with your contacts and go online to search for relevant data. The more information you gather, the better prepared you will be to proceed in the proper direction. Let me know if you have questions or comments on this often overlooked subject.
Ask me if you have a question and I will answer you.