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 Carlsbad, CA

Latitude: 33.12199 -- Longitude: -117.296811

Other Area Cities: Cardiff By The Sea Encinitas Oceanside Vista San Marcos Carlsbad

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Carlsbad is a suburban city in northern San Diego County, California. According to the state Department of Finance, the city had a total population of 90,271 in 2003. Carlsbad was incorporated in 1952, in large part to generate sufficient funding to connect with the water pipeline running through San Diego County, but also to avoid being annexed by Oceanside. Environment is of great concern to the city. Thus, the city has drafted ordinances protecting sensitive wildlife habitat, one of the first such ordinances within the state of California. The city has also promised to protect a certain amount of land within city limits from development of any kind, along with spending significant funds to restore habitats destroyed by newer development projects. Because of its location, relatively low population density and high performing school districts, the city is seen to have a rather high quality of life. -- Source: Wikipedia.com

California 2000 Census Population Profile Map

	Carlsbad	California	United States
Population	78,247	33,871,648	281,421,906
Median age	38.9	33.3	35.3
Median age for Male	37.9	32.2	34
Median age for Female	39.9	34.4	36.5
Households	31,521	11,502,870	105,480,101
Household population	77,460	33,051,894	273,643,273
Average household size	2.46	2.87	2.59
Families	20,894	7,920,049	71,787,347
Average family size	2.96	3.43	3.14
Housing units	33,798	12,214,549	115,904,641
Occupied units	31,521	11,502,870	105,480,101
Vacant units	2,277	711,679	10,424,540

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