Sometimes the best insights come from a taqueria sign. When the famous El Arroyo Taqueria sign declared, “Can’t Believe Tiger King was the most Normal Part of 2020”, we knew they were right. This has certainly bee one crazy year.
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A global pandemic, a recession, and mass protests. All of these have impacted everyone in various ways, and for some, it has literally been a matter of life and death. At a minimum, it has caused us all to reassess the plans and goals we set only 4 months ago (or was it 4 years?). For some growing families, the plan was to trade up to a larger home sometime this year. Whether your family is growing because of kids or furballs, a home can start to feel really small, really fast. This feeling has probably been exacerbated by the lockdowns, as we all grappled with balancing work and home life all from the same space. If you haven’t given up on the dream of trading up, here are a few things to consider as you reevaluate your plans and timing.
Should you buy first or sell first?
Regardless of the market, this is the one we probably get the most and it’s a question very specific to you, your financial position, and the marketability of your home. The most conservative approach, especially in uncertain times, is to put your home on the market first, sell it, and then purchase your new home. Obviously, this approach comes with some risk. If you can’t find a home right away, you may have to find some temporary housing. However, in some markets, rising inventory levels may provide more options. Furthermore, by starting your home search first so you can further narrow down the specifics of your new home, you can make it more likely that you will be able to find your home during a shorter window.
How marketable is your home?
Real estate is micro-local. The marketability of your home will be dependent on the style of home (i.e. Bungalow, Townhome, etc.), the location (Heights, Cinco Ranch, etc.), and Price. For example, Heights area bungalows continue to be very marketable properties. Low-interest rates and the challenges of quarantining in an apartment have caused many prospective first time home buyers to enter the market. Many of these properties are selling in a matter of days and multiple offer scenarios are not uncommon. Alternatively, luxury homes, especially those over $1MM, have been less robust during the downturn and have taken longer to sell. The best way to determine the marketability of your home is to enlist the help of a local Realtor who specializes in your market. They can connect you with a lender who can walk you through the financial implications of buying and selling.
How much space do you need?
During the lockdowns, many of us have spent A LOT of time at home. More than we ever have before. It has caused many of us the reaccess how we utilize the space we have and the space we’d like to have. For some, that may be more outdoor space to make it easier to walk the dogs or entertain the kids. For others, it might be a formal study, because working from home is part of your new normal. Think about how you have lived over the past 3 months and whether your experience has provided a different outlook on how you live and how you work.
Can I get a better deal next year?
This is the toughest question in real estate and even more so in times like these. From global financial meltdowns to oil price crashes to Old testament style flooding, Norhill Realty has seen a lot of crazy things. However, we haven’t seen a global pandemic. No one has in over 100 years. That being the case, it is hard to predict how quickly things will turnaround. As we covered in our Is a Buyer’s Market coming to Houston article, we do know interest rates are near historic lows and Congress has enacted legislation that should help keep inventory levels down. All of those factors could help stabilize the market over the coming months.
Whether it is a good time for you to buy or not is going to dependent on your long term time housing needs. Those home buyers looking for their forever home (or at least a home they want to keep for 7+ years) are at less risk because they will be locking in rates at historic lows and they will have more time to wait out the downturn before selling.
If you would like to speak to a Norhill agent more about this topic, feel free to call us at 713-869-7500 or email us at [email protected] You can also fill out the form below to get matched with an agent.