Why Would You Want To Sell When The Sky Is Falling?

November 20, 2008

Are you crazy? Are you so flush with money that you don’t mind giving away $20,000 or $30,000 of your equity? I almost said “hard-earned” equity – but for most of us who’ve bought in the last 10 years, we didn’t have to do much other than sit back and watch our home appreciate. But however we’ve earned the equity, it doesn’t seem on the surface to be a good idea to sell right now.

But what if I told you that by giving away $20,000 I’ll give you back $30,000? You’ve now netted $10,000. Sounds a bit better now, doesn’t it? You’re continuing to earn equity the “easy” way – even in this different market.

Let’s say that you own a house that a few years ago was valued at $200,000 – up 30% from when you bought in 1999. Unfortunately prices have dropped in your area so now your home is only worth $180,000 – down $20,000 from 3 years ago. Ouch! It’s no good wishing you’d sold then – that window of opportunity has already passed. But if you have a stable job in an industry that appears to be weathering the economic downturn fairly well, then you might want to consider taking advantage of lower prices on larger homes. If you’ve had to drop your price 10%, then larger, more expensive homes will have to drop their price also. A home that would have cost $300,000 two years ago may now be listed for $270,000.

Then add in the monthly savings of an incredibly low interest rate (I just spoke to a Mortgage rep and he told me as of December 30, 30 year mortgage rates are holding at between the high 4% and mid 5% range. Fifteen year rates are slightly lower at 4.75%.) So what does this mean to your bottom line? For many, the cost is only a couple of hundred dollars more a month for a much bigger comfortable home. Only you can do your calculate what the cost of moving into a more spacious home would be. If I were looking to move up, and my long-term employment seemed secure, I’d definitely be looking now!

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Local Information for Fresno, CA

Latitude: 36.781549 -- Longitude: -119.792113

Other Area Cities: Fowler Clovis Madera Fresno

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Fresno is the sixth-largest city in California and the county seat of Fresno County. With a 2005 California Department of Finance estimated population of 464,727 and estimated metropolitan area population of 1,002,284, it is the largest city and second largest metropolitan area in California's expansive Central Valley. Fresno is located at 36°47' North, 119°48' West. Its ZIP Code is 937xx. Fresno serves as the economic hub of Fresno County and California’s Central Valley. While the unincorporated area and rural cities surrounding the City of Fresno remain predominantly tied to large-scale agricultural production, the City has been undergoing significant economic transformation. -- Source: Wikipedia.com

California 2000 Census Population Profile Map

	Fresno	California	United States
Population	427,652	33,871,648	281,421,906
Median age	28.5	33.3	35.3
Median age for Male	27.4	32.2	34
Median age for Female	29.6	34.4	36.5
Households	140,079	11,502,870	105,480,101
Household population	419,465	33,051,894	273,643,273
Average household size	2.99	2.87	2.59
Families	97,923	7,920,049	71,787,347
Average family size	3.57	3.43	3.14
Housing units	149,025	12,214,549	115,904,641
Occupied units	140,079	11,502,870	105,480,101
Vacant units	8,946	711,679	10,424,540

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