When is the best time to sell my home?
Is this the best time to sell? Should I rent out my home instead of selling? Should I buy my next home or rent instead? Instead of selling, what if we remodel instead?
Are you dealing with any of these questions? Know anybody who is?
To avoid the common blind spots in seeking the answers, let’s break them out into two categories:
- What does the money say to do?
- What creates the highest quality of life?
*Cue Venn diagram music** (I’m a sucker for Venn diagrams…)
In the money circle you’d put things like:
- How much could you sell your home for?
- How much could you rent it for?
- What are the associated costs with either?
- What does it cost to buy where you’re moving?
- What would it cost to rent?
- Do you need to sell before you buy?
- How much would it cost to remodel your current home?
The quality of life circle gets filled with questions like:
- What would it be like for each kid to have their own room? or
- What it’d be like to no longer have to maintain a home big enough for kids who are gone?
- What are the public schools like near my current and proposed home?
- What is the commute like from either location?
- Are their crime issues?
- Do I want to be closer or further from the city?
But don’t commute times have a dollar cost to them? The difference between public and private school certainly does. Renting has a quality of life cost as well as a monetary cost. Mess around with the Venn diagram above long enough and you’ll begin to notice something. Questions that at first blush fit neatly on the money side, can shift into the quality of life side. Quality of life issues likewise almost always come with a monetary cost.
Buying a home is not always better than renting. Owning a home you rent to others to build equity is not the best path to wealth for everyone. These are individual choices, not something decreed from on high. That we are looking for the “right” answer, not only in matters of real estate, is often a blind spot for us.
We live as if there are choices that are inherently right or wrong and then demand we find the “right” one. Little creates more stress, and less joy, than pretending we could make the wrong choice.
Is it even possible the only “right” answer is the one you own as the right answer for you right now?
Looking into the thought process will give you some power with the choice you make.
When you see that Confirmation bias skews the very act of looking, you are not tied as tightly to it. Notice how unexamined, preexisting notions color the process. What do you already know to be true about the situation? What are you certain about? These are usually flags to where confirmation bias lay in hiding.
Watch for how, once you find “the answers”, you stop looking for alternate possibilities. Can you catch yourself collecting evidence that the choice you made was that holy grail of all choices, the “RIGHT CHOICE”?
The availability heuristic will likely have you put a disproportionate amount of weight on what passes for “news”. Interest Rates are Going UP! Housing Prices Reach New Highs! It’s hard to escape these headlines at every turn.
Unfortunately what isn’t as readily available is that this “news” is generated to sell advertising. Prices, like interest rates go up and down. Uh, excuse me, but that’s not news. What’s new about that? Think about it. It can only be “news” the first time you hear about it. The rest of it is more likely to be hype than relevant.
Is the latest “peak” the top? Neither you nor the talking head have any way of knowing. Are increasing interest rates going to mean a rush of buyers or and end to the rush of buyers? Anyone pretending to know the answer is doing just that. Pretending.
So what is the answer? What can you do? Consider, if you practice being present, you cannot make the wrong choice. It’s not that it doesn’t matter what you choose. It matters. There will be consequences either way. But because it matters is not to say there’s a right and a wrong choice. If you honestly looked for an answer, and you can be responsible for your choice, then that is the right answer.
To illustrate the malleable nature of this type of choice, let’s look at a friend of mine. This is a woman who is brilliant in many ways, not the least of which is in the area around building and managing wealth. She lives in Silicon Valley, one of the hottest real estate markets in the country. This woman has a mastery of the costs and benefits of long term renting vs. home ownership in a way that, when I think about it, makes my eyes roll back in my head. She’s been clear for years, that, with what she’s committed to in life, and what’s important to her, that renting, and not owning, made the most sense.
Then two things changed. First, her family became 33% larger when she and her husband welcomed their baby daughter into the world. Second, her landlord called and told her he was going to take advantage of the hot market and sell. They had 60 days to vamoose!
Now, either of those things happening on their own, might not have been enough to shift her personal Venn diagram. In this case, this time, the overlap, the “what works”, changed in a moment. I’ve never seen anybody, in any market, pull it together so quickly and manifest the perfect home to buy.
Did any of the fundamental financial considerations that make owning a home vs. renting change? Not really. She very well could be buying at the very peak of the next bubble (I don’t think that’s the case, but it could be). She was happy with the financial implications of being a renter when she had a baby. And moving from time to time without a baby was acceptable. But change both those items at the same time and the “what works” for her changed. There was now a new set of concerns. The items in her circles got newly weighted. A new answer into the “what works” section appeared.
Again, my point: there are no “right” answers, only answers that are “right” now.
This is true of most, if not all, the complex choices with uncertain outcomes we face in life. Instead of looking for certainty in the answers, we’d be better served by looking for certainty in the process by which we come up with the answers. Keep an eye out for potential blind spots, watch for anyone, including ourselves, claiming a direct line to the “truth”.
Did my friend make the “right” choice? How could anyone from the outside say? Could she have continued to rent and called it the “right” choice? Of course. But, because her thinking is clear, no matter what happens next, in the market or in her life, she’ll make her next brilliant decision and move on from there.
Is it the right time to sell? Who are you asking? Do the work. Investigate everything. Keep looking. Ask questions. Don’t chase the market. Stay informed. Be willing to trust yourself to find the “right now” answer for you.
I’d love to hear what you think, or any stories you have about buying or selling your home. If you’re a home owner and would like to help my research for my next book, you can take this short Survey Monkey. I’m raffling off a $50 Amazon gift card with every 100 responses, so go for it!