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It's no secret that home values have soared on a national level this year. A big reason stems from the fact that buyers have been clamoring for homes to take advantage of low mortgage rates at a time when inventory has been limited. Because of this, buyers have been forced to overbid on homes, and that's driven prices up across the country.
All of this makes for a tough housing market from a buyer perspective. But from a homeowner standpoint, things are looking quite positive.
This applies to both homeowners looking to sell and those looking to stay put. The latter group is now sitting on record levels of home equity, which means homeowners may have more options for borrowing against their homes.
But homeowners hoping to sell are now in a great spot, at least in theory. That's because homes sold during the third quarter of 2021 generated an average profit of $100,178, reports ATTOM Data. Listing your home in the near term could end up being quite the lucrative endeavor.
Should you sell your home now?
Clearly, it's a seller's market, and that's reason enough to consider moving forward with the sale of your home. But before you make the decision to sell your property, you'll need to answer one key question – where will you live once your home is sold?
If you're looking to downsize your home, then selling right now could be a great move. Chances are, you'll walk away with a nice profit on the sale of your home, so much so that you might even manage to buy a smaller place to live without having to take on a mortgage.
But if you're looking to sell your home and upsize, or even move to a comparable home in a different part of town, then you may not come out ahead financially. What you'll gain via the sale of your home, you'll lose by paying a premium for somebody else's.
Also, right now, housing inventory is very limited on a national scale. Plus, since winter tends to be a slow time for new listings, you might struggle to find a replacement home that suits your needs, even if the profit you anticipate on the sale of your home gives you a pretty nice budget to work with.
Despite the potential to walk away with a large pile of cash, you may not want to sell your home right away. Instead, you may, at the very least, want to sit tight and wait for more housing inventory to hit the market – if not on a national scale, then at least locally, or in the area you'd be looking to live.
A tricky time all around
Though it's easier to be a seller in today's housing market than a buyer, many sellers ultimately become buyers once their properties are scooped up. Tempting as it may be to list your home and walk away with a larger profit than you'd normally get, hanging on to your home could end up being the more sensible decision.
A historic opportunity to potentially save thousands on your mortgage
Chances are, interest rates won't stay put at multi-decade lows for much longer. That's why taking action today is crucial, whether you're wanting to refinance and cut your mortgage payment or you're ready to pull the trigger on a new home purchase.
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