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 DeWitt, MI

Latitude: 42.717585 -- Longitude: -84.554916

Other Area Cities: Lansing Forest Hills East Lansing Grand Ledge Haslett Holt Okemos Mason

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Lansing is the capital city of the U.S. state of Michigan, and is located mostly in Ingham County. A small portion of the city extends into Eaton County, and a small portion containing Capital City Airport extends into adjacent Clinton County. As of the 2000 census, it has a population of 119,128. The Lansing metropolitan area is remarkable in that despite being a relatively small city it is an important center for manufacturing, educational, cultural, and governmental institutions, including three medical schools, two law schools, a Big Ten Conference university (Michigan State), the state capitol, the Supreme Court, an appellate court, a federal court, the Michigan State Library and Historical Center, and headquarters of four national insurance companies. Lansing is the only U.S. state capital that is not also a county seat. -- Source: Wikipedia.com

Michigan 2000 Census Population Profile Map

	Lansing	Michigan	United States
Population	119,128	9,938,444	281,421,906
Median age	31.4	35.5	35.3
Median age for Male	30.2	34.3	34
Median age for Female	32.6	36.6	36.5
Households	49,505	3,785,661	105,480,101
Household population	118,256	9,688,555	273,643,273
Average household size	2.39	2.56	2.59
Families	28,373	2,575,699	71,787,347
Average family size	3.08	3.1	3.14
Housing units	53,159	4,234,279	115,904,641
Occupied units	49,505	3,785,661	105,480,101
Vacant units	3,654	448,618	10,424,540

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