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 Westerly, RI

Latitude: 41.374807 -- Longitude: -71.81873

Other Area Cities: Groton Westerly Mystic Charlestown New London

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Westerly, founded in 1669 by John Babcock, is a beachfront community on the south shore of Washington County, Rhode Island. The population was 22,966 at the 2000 census Westerly's primary industries today are textiles and tourism, but historically Westerly was also famous for its granite, mined from quarries in Bradford and Potter Hill. Westerly was named for the settlement's location, respective to Rhode Island's geography, being the westernmost town in the state. There is also a possibility that Westerly got its name from the English village of Westerleigh, England. The English village was the home of one of Westerly, Rhode Island's founding father's, Elder John Crandall (1616/7-1676). Elder John settled in Westerly in 1661 and the early history of Westerly contains many references to him and to his sons. Westerly sits atop a glacial moraine, which is a series of small hills of debris left behind by receding glaciers in the last ice age. -- Source: Wikipedia.com

Rhode Island 2000 Census Population Profile Map

	Westerly	Rhode Island	United States
Population	17,682	1,048,319	281,421,906
Median age	39.1	36.7	35.3
Median age for Male	37.5	35.4	34
Median age for Female	40.7	38	36.5
Households	7,346	408,424	105,480,101
Household population	17,338	1,009,503	273,643,273
Average household size	2.36	2.47	2.59
Families	4,661	265,398	71,787,347
Average family size	2.97	3.07	3.14
Housing units	7,812	439,837	115,904,641
Occupied units	7,346	408,424	105,480,101
Vacant units	466	31,413	10,424,540

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