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When to sell? When to buy?

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My house is approaching its all-time high value, and I need to sell soonish to buy bigger to accommodate the family.

 

While I understand the timing to sell is basically "Right Now or Soon", I'm also trying to maximize my gains by buying during whatever crash may be coming.

 

I think there will be at least an across-the-board reduction once people have to start paying their rent/mortgages again, and many find themselves unable to do so.

 

Does anyone have any insight on when that day might come?

 

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Think of it as a stock and not a house. Timing the market is a crap-shoot. During the last peak, back in 2007, the house we had then doubled from purchase price in 2000 to market boom. Of course in real time we had no idea it would be the top of the market. At the same time, we were shopping for something larger and closer to work. We got outbid on at least half-a-dozen houses and eventually capitulated and stopped looking by early 2008. We had no idea that by NOT being more aggressive in our bidding wars would end up saving us over 300k.

 

FF just a couple of years and the market crashed. We ended up buying a house in 2011 in one of the same developments we were outbid in a few years earlier. We paid 55% of the price the seller paid just 4 years earlier. Our old house sold for 20% less than we paid for it (we lived in it about 10 years). So we "lost" 5 figures on our old house but "saved"  several 6 figures on the house we bought. I never thought of the 'loss" in the old house as a loss since we lived in it for over 10 years and that loss was much lower than if we had been renting all that time.

 

I told myself when we bought our current house if prices ever double again I'll sell and rent. Well we've seen about an 80% appreciation in the 9 years we've been in this house. If we hit 100% I'm not sure I'll want to sell but it will be tempting.

 

Back to the stock analogy... are you interested in selling, putting the proceeds in the bank, and renting until the next crash you're looking at a crap-shoot that there will be a crash in housing prices. Think about what percentage fall in prices is needed to make this worth the timing risk... 20%? 40% more? In the meantime, are you renting or holding onto the old house and seeing its value drop?

 

I think trying to time the real estate market (betting there will be a large crash or a huge boom) is not much of a strategy unless you are willing to 1) sell and rent or 2) carry both properties or 3) risk selling the old house at a "loss." Recessions are common but large drops in house prices like we saw in the great recession are less common. Early still in this pandemic, but so far signs do not point to a real estate crash. I imagine if all vaccines being developed fail then all hell will break loose, but of course there might be bigger things to worry about then.

 

All that word salad said, you may want to talk to a couple local agents just to see if they have any feel for the market..just remember their job is to sell sell sell you and I would never take timing the market advice solely from someone with that incentive structure.

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Sell and rent was my first idea.

 

Fiancée and I are in separate houses, so I could sell, rent, and bide my time.

 

I just can't see housing NOT retracting soon.  No one will be flush...prices can't go up.

 

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49 minutes ago, brainchasm said:

Sell and rent was my first idea.

 

Fiancée and I are in separate houses, so I could sell, rent, and bide my time.

 

I just can't see housing NOT retracting soon.  No one will be flush...prices can't go up.

 

well then think about how long you are willing to wait for the crash and how you;d feel if the crash doesn't occur during that period. You're not just calling a "peak" but also will need to determine when has the knife stopped falling. good luck and I'm curious to learn how it works out.

 

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18 hours ago, brainchasm said:

Sell and rent was my first idea.

 

Fiancée and I are in separate houses, so I could sell, rent, and bide my time.

 

I just can't see housing NOT retracting soon.  No one will be flush...prices can't go up.

 

Retraction in the pricing is NOT incompatible with people still being flush and prices being artificially deflated.

 

Even in 2008, there were markets where it was very much a seller's market with bidding wars on properties.  The same will occur the next time, whether next year or the year after.  AND there are still people making money and that have a very liquid position. 

 

The question is whether you are in one of those markets.  If not, then get while the getting is good.  If so, then time is on your side...

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I've purchased two homes in my life, and I still have both of them.

 

Regardless of what else is happening, I've never regretted spending dramatically less than I can "afford."

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Will there be a housing crash, of course! When and where? Who knows.

We are starting to see signs in New York City and San Francisco as people are moving to the suburbs. If you're a conservative living in Seattle your probably starting to look elsewhere. Conversely, if your living in the Hampton's your seeing an all time high in housing prices. Real estate is local and what you might see in one area might not be a national phenomenon. 

Or, we might get hit by an asteroid and all the survivors are living in caves.

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On 8/1/2020 at 6:20 AM, 8ball said:

Or, we might get hit by an asteroid and all the survivors are living in caves.

In which case, there WILL be someone asking people whether they want a two or three chamber cave.  Questions WILL be asked about restrictive covenants and, inevitably, someone will want financing. 

 

The world will continue as we know it...

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