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Timing the Market?
August 18 , 2004 by EditorAs Chandler residents, we have all seen local real estate market values climb. We have watched our neighbors profit, and we’re tempted to sell our homes, maximize appreciation, liquidating your equity to move into a bigger, better home. You may be on the right track.
All markets are cyclical: stock market, bond market, commodities market, and of course, the real estate market. Traditionally, the real estate market is the best market to ride out any economic cycle because of the nature of the investment. The last big downturn in the Arizona housing market occurred in the 80’s. Some homeowners lost large portions of their equity in a short amount of time. The people that were able to ride out the cycle fared well and walked away with decent gains. For an owner that was able to hold their properties, appreciation averaged at least 3%, even over the worst 3 years in our recent history. Sellers that panicked experienced a loss. If you are considering making a move because you want something more but you’re trying to time the market, consider this:
Would you be happier riding out a cycle in your current home or would you be happier in your new nicer dream home?
The bottom line is this: if you know that you will want to “move up” at some point in the near future, this may be the best time to sell. If you sell your current home and buy a new home, and then values decline for any reason, you will be in the house that you truly want to be in. You will be much more comfortable riding out a cycle if you are happy in your home.
When you sell your property, you’ll be buying in the same market in which you sold. Realtor selection is hugely important. While great properties become available everyday, it won’t matter if you never get a chance to see them before they sell. You need an agent that has a good network as well as insight into today’s market. The right realtor can even get you into some properties before they hit the open market. On the other hand, choosing the wrong Realtor can cost you thousands of dollars and countless hours of valuable time. With over 22,000 realtors in the current MLS (multiple listing service) and around 40,000 licensees in Arizona you need to be careful, we are not all created equal.
Thinking of Selling and Buying New?
Now is the time! Simply put, you will maximize the equity in your current home and buy in a new home market with great prices. Well-designed, large-scale master planned communities are being built in a variety of locations. Inventory in new homes creates competitive pricing. Please consult with your Realtor regarding areas and builders that may see the best appreciation. A very active and networked Realtor can also receive undisclosed updates from their personal network of builder representatives. This information can put thousands of dollars in your pocket.
Good Luck!
This article was written by Ross Cobb and Marty Recht. Ross and Marty are principles in Long Realty-Alliance and are top producing agents in the East Valley. Long Realty is A Home Services of America Company and Berkshire Hathaway affiliate, one of the largest and most powerful real estate companies in America. Long Realty-Alliance is independently owned and operated. For questions regarding Arizona real estate, investing, this article or real estate career opportunities with Long Realty contact:
Ross Cobb or Marty Recht
480-777-1314
ross@rossandmarty.com
marty@rosandmarty.com
