Factors homeowners should consider when debating a move
Category Housing Market
Whether it be after years of living in the same property or spotting a favourable shift in the market, every homeowner eventually faces the difficult question: is it time to sell and move on?
"Even if you're dreaming about an exciting change, actually pulling the trigger and putting a beloved home on the market can be an agonising decision full of uncertainty," says Claude McKirby, Co-Principal of Lew Geffen Sotheby's International Realty in Cape Town's Southern Suburbs and Noordhoek.
"From financial considerations to emotional attachments, there's a lot for prospective sellers to weigh before taking the leap and, whilst some convincing signs could indicate that it may be an ideal window to move, other factors might show that riding it out makes sense.
"But whichever way you decide, it's a major decision that will impact every aspect of your life both in the short and long-term so it's essential to get it right."
McKirby advises that the following are key points that homeowners grappling with this dilemma should carefully evaluate:
Motivations for Selling:
Changing life needs or goals is often the initial catalyst for mulling over a home sale. Common motivating factors for relocating include:
Downsizing or Upsizing: As family dynamics change with kids growing up or elderly relatives moving in, a home's space needs is often no longer be an ideal fit so determining whether you need less or more square meterage is step one.
Life Transitions: Other major life events like retirement, divorce, new job opportunities, or even tragic circumstances like death can necessitate an entire change of scenery and fresh start elsewhere.
Return on Investment: For homeowners sitting on significant equity, selling a property while market conditions are optimal can be an incredible financial windfall and investment return if you time it right.
Lifestyle Change: Sometimes the desire for a new lifestyle like moving to the city, shifting to a walkable community, or even a warmer climate can drive the urge for a real estate shakeup.
Financial Factors
For homeowners struggling with the decision, money concerns are invariably front and centre:
What's Your Net Profit? Factoring in selling costs (transfer fees, moving expenses, repairs, agent commissions, etc), can you walk away with your desired profit from a sale? Run the real numbers and be thorough.
What Will It Cost to Replicate? Consider whether there will be higher home prices, mortgage rates, property taxes, and rent rates in the new desired location and, if so, can you actually afford making a move right now?
Tax Implications: Selling could impact your tax situation positively or negatively depending on circumstances. Review how potential capital gains and other taxes come into play.
Available Contingency Funds: Even if you're planning to buy a new home with sale proceeds, make sure liquidity exists to cover any timeline gaps between selling and closing on the new property.
READ | Looking for a home that ticks all your boxes? Try Property24 Alerts
Emotional Factors
Moving is far more than just a financial transaction - it's emotionally charged and complex and these factors should not be ignored.
For some, the emotional identity tied to their home runs incredibly deep and strong and that's not something to underestimate or just abruptly abandon. Others fear being detached from their existing community and support networks that took years or decades to build. Local connections are hard to replicate.
Furthermore, the anxiety and uncertainty of a major move, even if positive overall, can create significant stress and doubt that can impacts decision-making.
While emotional forces shouldn't single-handedly dictate major financial life decisions, an honest self-check on mental readiness remains paramount.
Indicators It Might be Time to Sell
McKirby says that although every situation is unique, there are certain signs that do lean more in favour of selling:
- You Have Significant Equity Built: Due to rising appreciation, homeowners sitting on sizable equity could capitalise on a market upswing, especially if they are in a desirable area where available stock is low. If returns meet your goals, great timing.
- You're In a High-Demand Area: Is your property situated in a hot neighbourhood that buyers covet? You may never get a better window to sell at maximum profit.
- Interest Rates Are Still Attractive: If buyers can lock in historically affordable financing, it makes homes more accessible. Rates jumping could depress your buyer pool.
- Life Events Beckon Change: Marriages, births, job shifts - major life milestones are ideal catalysts for initiating residential moves attuned to new stages.
- Local Development Is in Flux: Keeping tabs on forthcoming community projects, transportation improvements, and rezoning can signal opportunistic windows for cashing out.
"At the end of the day, only individual homeowners can weigh the complete personal variables and timing for their circumstances to determine if selling is truly the right call," says McKirby.
"And with such a monumental decision and high stakes involved, thorough consideration and trusted guidance from real estate experts is essential. Remember, the option will remain to list whenever you're fully comfortable with doing so.
READ: Sellers: Pay careful attention to your floors to ensure your home sells for full value
Extra tips:
David Jacobs, Regional Sales Manager for the Rawson Property Group, previously shared in an article published 30 June 2023 (read full article here), that to improve your odds, he suggests doing the following prep work, alongside any specific recommendations from your real estate agent:
Deep clean - there's nothing quite like a layer of grime to put a buyer off. Put some elbow grease into getting your property squeaky clean and shining, including windows, carpets and curtains.
Declutter - make your home feel more spacious by clearing out as much clutter as possible. Pop those doodads and knickknacks in storage, clear your counters and garage corners, and unstuff any closets that appear overly full. (Storage space is a big selling point, so make yours look as large as possible.)
Depersonalise - our homes are normally safe spaces to express our personalities and our views on religion, family, politics and more. When showing your home, however, it's best present as neutral a picture as possible, removing items of a personal or controversial nature to make it easier for buyers to imagine their own lives in your space.
Leave it to the pros - most buyers feel awkward exploring a space and asking difficult (but necessary) questions about a property under the watchful eyes of its owners. It's far better to take the family - including any furkids - out for the day, and let your agent do their best work with complete focus.
https://www.property24.com/articles/factors-homeowners-should-consider-when-debating-a-move/32261
Author: Property24