Signs That You Shouldn't Sell Your Home Right Now
Signs That You Shouldn't Sell Your Home Right Now
The housing market is on the rise, but that doesn’t mean you should automatically sell your home if there are any signs of a decline. Here are five tell-tale signs you shouldn’t sell your home right now.
1. The Market Is About To Decline
The primary reason not to sell is that it wouldn’t be a good idea to sell right now. The housing market is on the rise, but this doesn’t mean it will stay that way forever.
Canada's Real Estate market is notoriously in flux and has been unpredictable.
There are many indicators that show homeowners should wait before selling because they may end up losing money instead of gaining it, still, the person best suited to know when the best time would be to sell is a real estate agent.
One of their main responsibilities is keeping their fingers on the market's pulse to understand how to best maximize the value of a property.
Maybe you're not exactly itching for the absolute maximum return on your investment when selling your home but the fluctuations can lead to massive gains or losses.
Rushing into things draws more on luck than anything else, and when it comes to the sums involved in buying and selling houses; luck shouldn't be the main deciding factor.
If you hear the phrase "a buyer's market," it's time to rethink things.
Today's market for your home might not be what you want. This is something your agent should know and tell you about.
You might think that you want a balanced market or a more balanced market but ideally, what you're waiting for - if you can wait - is a seller's market.
Home sales in a seller's market benefit the seller because there are more potential buyers than available homes. Most buyers will try to shop around open houses to find something within their listing price but you may come across someone that is willing to put down more money for your home than it would usually attract.
In a buyer's market, however, the same transaction works in the buyer's favour. There are more homes for sale and the sales price plummets.
2. You’re Moving To A Different Neighborhood
If you are thinking about selling because you plan on moving somewhere else, why take the risk?
There is always a chance that your home will not fetch as much money as you hope, so it’s likely for this to happen if you don’t know the neighbourhood very well. Before putting a downpayment on a new house in a new area, take a step back and think about what's really in the purchase price.
The way your house looks and where it is in relation to everything else matters in real estate, and if you’re moving into an area that doesn’t look like a good investment for potential buyers, they may think it will be too much work when they try to resell the home.
Essentially, you want to think two steps ahead. Not just about selling your current house and moving to a new neighbourhood but what the situation will look like if or when you decide to sell the new house.
Even if you're comfortable with a loss on your current property for the sake of the new house, you need to take into account what moving on from the new property will mean financially. Additionally, purchasing property means being tied up in a legally binding contract with a few different entities like a mortgage lender and your bank.
As we've noted before, the market is unpredictable for most people, even more so in the long run, which means that you need to make very conscientious plans. If you think that that, ultimately, the risk won't be worth the reward, moving to a new neighbourhood can wait.
3. Maintaining Your Home Is Taking Up Too Much Time
There is nothing more stressful than trying to keep up with the demands of home maintenance. If you are constantly stressed out by this, it’s time to step back and consider whether or not staying in your home would be the right decision for you at this point in time. After all, current mortgage rates moving may result in dealing with a monthly mortgage payment that doesn't let you hire someone to help you around the house.
Remember that moving somewhere new means creating a new maintenance routine, finding and fixing a whole slew of issues, as well as getting used to the new house.
Of course, moving to a smaller or more manageable house that may make things easier in the long term sounds like a good idea but you need to keep in mind what the short-term stresses could mean for you and your family. After all, with the market being the way it is, waiting to sell could mean the ability to move into a home that requires much less maintenance.
4. You Don’t Have Time To Properly Show Your Home
Many homeowners choose to take their homes off the market because they are unable to provide potential buyers with enough information. Home prices fall and an existing or rising mortgage becomes an even heavier anchor pulling you toward financial distress.
Both a buyer and that buyer's agent will look for something essential: the feel of the house. And the best way to get an idea of what a house might feel like is an open house.
The issue, however, is that planning an open house is a complex process and you need to factor that so you understand what your net proceeds will look like. Done well, an open house can have ripple effects through word of mouth and attract buyers.
On the other hand, not allowing people to see your house and walk through it at their leisure will drive buyers away, or will give those still interested good reason to give lower offers. The last thing you want is to sell your home for less than it's worth.
Beware of pushy dual agency agents.
If your real estate agent is also the agent of a potential buyer, you need to be aware of that from the start. All agents want to move fast to satisfy their clients, but when one is the sole agent overlooking a transaction you need to make sure that both you and the buyer are getting the best deal - and not the agent.
Agents need to disclose their dual agency relationship, and though many perfectly reasonable agents do practice dual agency, make sure it's something you and the buyer agree to before selling your home.
If you don't feel comfortable, speak up. It's better to do so sooner than later. You may prefer it if you and a prospective buyer have separate real estate agents - if that's the case, you should mention this to your real estate professional as soon as possible.
5. Your Property Is Not Ideal To Invest In Right Now
Many people make the mistake of assuming that just because something is affordable, it will sell. The truth is more complicated.
Someone may be able to afford the mortgage payments, the property taxes, and the asking price out of the gate but a real estate agent may advise against the purchase of your home. Why?
There may be some things that make it a bad investment, think of the marijuana grow operation next door or the construction happening across the street. Despite your reassurances, real estate professionals are legally obligated to look out for their clients.
Some buyers are waiting for the right time to invest in a new house. Take a look at your neighbourhood right now and what it might look like in the future. Developments around your area can make it more valuable in the future whereas construction would do the opposite.
Material latent defects
Buyers and their real estate agents may be worried about material latent defects (damage to the home that cannot be detected by a reasonable inspection) as a result of construction or weather events that have happened around your home.
They factor in the cost and think about their home equity down the line and suddenly your house is not only a bad deal but potentially dangerous. An owner has a legal obligation to disclose material latent defects but it doesn't mean that some don't and then the new owner discovers problems.
It might be tempting to jump the gun and go for a quick sale, but a little bit of patience might save you a lot of trouble. Put yourself in the shoes of the buyer's lawyer then take a step back. Take a good look around your home and hire someone who can help you sniff out if there is a material latent defect if you have a suspicion.
The most important thing is to act honestly and make it so you don't have to shop around for legal advice.
6. Would Buying A New House Truly Be An Upgrade?
If you are willing and able to sell, did you think about the next step? Think about the previous points: having your documents prepared, coming up with the down payment, dealing with all the finer details of two real estate transactions, acclimating to a new house, changing neighbourhoods, figuring whether the market is on your side or not, moving costs and stress.
Take stock of your property and everything around it. If you need help, contact a listing agent so you have a better idea of what you can expect from the home sale. Do you picture your living situation improving to the point where all the stresses and costs of moving are worthwhile? What about the next step?
The sell-buy cycle is one that can be slow and is influenced by a slew of factors. So, what you really should think about is not whether you should or shouldn't sell; the entire context of your situation is what you need to take into account.
Are you living in a hidden gem?
The average homeowner checks their local real estate board from time to time, wondering if their existing mortgage is worth the trouble while sitting inside a home that just needs some love and care.
Before you take real steps to become a home seller like looking up real estate agents or figuring out what to write in a listing agreement, think of what you can do to improve your house first.
Before you rope in a real estate professional, think about the ways in which your home can be upgraded. Rearranging furniture rather than tinkering with the details of transfer documents can save you the stress of the move and the real estate transaction.
What does it all mean in the end?
The key takeaway is that the question of whether or not to "sell your home" is only a fraction of the equation.
You need to think about what your living conditions will be like during the transition period when moving to your new house. While that's temporary, you also have to think about whether or not you have gone through a thorough checklist to find out if your new home will not lead you to regret selling your old one.
Most of all, however, you cannot leave life-changing sums of money on the table, getting the best deals possible will help you in the long run when your plans evolve.
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