There are many benefits to a market that favours buyers, even if you're selling a home in 2009. I've been working with several clients lately who are considering moving to a larger home in the spring of 2009 and have asked me if this is a good time to do so.
The main advantage to moving up in a market that favours buyers is that you can buy more for less. Although home prices in Guelph and area are remaining stable, let's take a worse-case scenario approach and say that they decrease by 5% across the board.
For example, if I'm selling my home of $200,000 and the price decreases by 5%, I'm selling at a $10,000 loss. The individual selling their home for $400,000, which I am interested in buying will also have a 5% decrease which benefits the buyer by $20,000. That means that as a buyer of a larger home I'm getting a $400,000 home for $380,000.
Home prices that are stabilizing and slightly depreciating are a great opportunity for a savvy homeowner looking to move up. Even though your home sale price may be lower the smaller loss at sale can be compensated by greater savings at purchase. To boot, we're at historically low interest rates which means that the larger home becomes more affordable.
For more information, please don't hesitate to contact me at lastovic.s@mortgagecentre.com. Sandra, The Mortgage Mentor.
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