You might be thinking “don't you just sort of know when it's time to sell your home?” Yes, some reasons are clear as day — such as if you’ve gotten a new job and you need to relocate. But sometimes the right time to sell isn’t always so obvious. So today, we’ve listed out some of the biggest signs that indicate you might be ready to part ways with your current home.
Look at these as mental and financial steps you need to complete.
1. You’ve got a nice chunk of equity.
Typically, the more home equity you have, the better the chance you’ll complete the home selling process with a profit. And since the housing market has been strong for the last several years, your home value may have risen without you even doing anything. You’ll find out exactly how much your home is worth during the home appraisal.
2. You’ve got money in the bank.
Selling your home comes with its own set of expenses you’ll need to consider. For example, you may need to make repairs to ensure the home is in peak condition. You’ll also need to account for things like the real estate agent’s commission, closing costs, and movers.
So start by taking a good look at your finances and credit score. If your debts are manageable, you have a high credit score, and a nice emergency fund, it’s a good sign you may be ready to buy your next home.
3. The house is getting crowded.
If you’re slowly but surely outgrowing your space, then it might be time to sell your home. This could be a sign that your family is growing, or you’ve started working exclusively home and you need an additional room or two. Simply put, needing more living space is one of the most common reasons why families move.
Of course, another option is to expand the home – which comes with its own set of challenges. A home addition doesn’t work for everyone, though. Especially if your property isn’t big enough or your town’s municipality prohibits it.
4. Rooms are gathering dust.
Basically, this is the opposite of outgrowing your home. Having too much space is a scenario that usually happens to empty nesters – and it’s a sign you’re ready to downsize. In this case, it no longer makes financial sense to have a four-bedroom house if you’re only using two of them – not to mention the cost of wasted utilities. The same can be said if yardwork and general maintenance are becoming overwhelming.
5. You’re mentally ready to sell your home.
Above all, maybe you’re just ready to move on and are excited for the change. You’ve come to grips with the fact that the house you’ve called home for years will soon be someone else’s. However, it’s not just parting ways with the family homestead. It’s about being ready and prepared for everything that comes with the home selling process—from hiring a real estate agent and fixing up the home, to staging and hiring a home inspector.
Ditech is not a financial advisor and the ideas outlined above are for informational purposes only. They are not intended as investment or financial advice and should not be construed as such. Consult a financial advisor before making decisions regarding important personal financial matters, and consult a tax advisor regarding the deductibility of interest and tax implications.