Are you dreaming of extra rooms or a more functional floorplan in your home? Maybe it’s time to make that move… If you’ll be able to work remotely for the long-term or your overall needs have just simply changed, it’s a great time to sell your house and move up. Why? With mortgage rates still low and higher-priced home sales powering more moves across the country, sellers in today’s market are finding the space they need (and have always dreamed of) by purchasing a home in the upper end of the housing market.
“The number one reason most people move to a bigger home is life transitions”
Dreaming of a bigger home is only natural, and even more true if you’re still in your starter home. A larger, more spacious home will provide more room for your growing family to be comfortable and spread out or to give you that extra office space. Plus, it makes it easier to host birthday parties and family gatherings.
But, are your finances ready for a pricier home? That’s an entirely different question that you’ll need to think over before you start shopping around for a new mortgage. Remember, it’s not just the sticker price on the house; it’s the long-term costs associated with it. When you go up in square footage, you get higher property taxes, higher utilities, and more maintenance.
While everyone’s situation is different, here are a few signs you can afford the larger home of your dreams.
- Your debt-to-income ratio is low
- You’re meeting your savings and investing goals
- You have plenty of insurance
- Your emergency funds are plentiful
- You have good or excellent credit
- You have a grasp on your monthly expenses
With so few homes available for sale and high demand from today’s homebuyers, sellers are profiting in major ways this season. There are bidding wars driving up the sale price of more and more homes throughout the country. This means sellers are able to leverage this extra cash from higher-priced sales while also taking advantage of today’s record low mortgage rates when they purchase their next home. It really is the perfect scenario to move up into a true dream home. From the Institute for Luxury Home Marketing:
Luxury home prices continue to see record highs in the majority of affluent ex-urban communities, as the influence of being able to work from home is still driving buyers away from living in high density areas. Low interest rates also remain in play, allowing buyers to realize the affordability of owning a larger property, which further reinforces this trend.”
Bigger, more expensive homes, allow you to make more money on your investment (in a good market). If you can afford it, buy a bigger house and reap the returns.
While this price range certainly doesn’t fit every budget, if it’s in your reach this summer, you may want to make your move sooner rather than later. Today, more homes are available in this segment of the market, but as the report mentions, more buyers are investing here too, so the competition may heat up sooner rather than later.
There are downsides too…. A larger house means a larger utility bill. If you have a longer driveway or a bigger yard than before, you may need to purchase a leaf blower or lawn mower, or pay more to have it maintained. You may feel like you have to buy additional furniture, now that there are voids of emptiness in rooms. And don’t forget about taxes… There are of course factors you need to weigh before you make the decision.
Changing houses — even if it’s for the better and absolutely the right thing to do — can be unsettling, and it’s an intangible that any homeowner should consider.
If you’re planning to sell your current home to move into a larger one, message me and we can discuss your current situation and the opportunities in our local market.