Three Things – Now or Later?

It is typically while driving between appointments that I have the most time to reflect on time spent with Clients and the dialogue we’ve shared. It is during these ‘periods of reflection’ that I tend to recognize and be reminded that people often have the same questions in mind when I see them. Recent visits with Clients got me thinking about some of the common questions that seem to come up; regardless of market conditions: When is the best time to list? Is the market going up or down? Is it a buyer’s market or a seller’s market? Is now a good time to list? Should I wait to buy?

Delivered in one form or another, these are pretty much standard and expected questions under any market conditions; and at times they can be difficult to answer. With the above in mind, I offer three things (in no particular order) buyers and sellers may want to consider while contemplating any form of the questions above:

First Thing — Assess your needs and goals
…what do you need and/ or want to accomplish…

Second Thing — Buyer’s market vs. seller’s market
…under your circumstances right now, does it really matter which side the market favours…

Third Thing — Now or later
…buy low-sell high doesn’t apply to everybody everytime…

Assess your needs and goals: In terms of the “best time to list”, it really comes down to what you need and/ or want to accomplish. Like most home owners, you likely want to get the most amount of money out of selling your existing home while paying as little as possible for your new home – but consider the following: if you need to sell your existing home before buying your next home and are entertaining the idea of waiting a month or two so that you can try to get a better price for your existing home, isn’t it likely that the as-yet-unidentified property that is to become your new home will also increase in price? Typically any increase in value in your home is an overall market increase and as such, will be a relative increase affecting both the property you are selling and the one you want to buy. Is it really worth getting and extra $10,000 for your home at the risk of paying an extra $25,000 or $30,000 for your new home?

Buyer’s market vs. seller’s market: When it comes right down to it, does it really make a difference? Understand that I’m not being flippant about this nor am I discounting the fact that for some people this can be particularly important; and may in fact be a significant determinant to whether they buy or sell. What I often discuss with my Clients is context – consider the market in the context of your personal circumstances. I ask them to consider (among other things) their motivation for buying or selling and then consider whether it really matters to them which side of the buy/ sell equation the market is favouring. In other words, if they need to buy or sell and have a sense of urgency driving them to do so, then the sidedness of the market is somewhat immaterial. The market is what it is at that time and (for better or worse) happens to be the market in which they will have to negotiate the best result they can under the circumstances. If they are simply toying with the idea of moving and are contemplating doing so only ‘under the right conditions’, then making a move in an extremely one-sided market may not make sense for them and they should give some consideration to waiting it out until the market begins to balance again.

Now or Later: It’s a personal choice — what works for you. Its true that many people have timed the market just right and have sucessfully employed the ”buy low-sell high” strategy. In my opinion this is a great strategy if you’re an investor, but not necessarily the rule to follow if you are a home buyer or home seller. If you are buying a house to call home for a long period of time without any intention of selling any time soon (i.e. its not a ‘flip’ or a rental), then the buy low-sell high strategy shouldn’t really matter much. So what if the market takes a slight dip after you buy your home and its now worth $10,000 or even $20,000 less than when you bought it six-months ago? You weren’t planning on moving again soon anyway, right? I’m not dismissing the value of money; we all work very hard for it and most of us would be at least a little bit upset if we lost even a hundred dollars. Now I know as well as anybody that circumstances change, life moves quickly, and sometimes the polar-opposite of what we planned is what actually happens. The result – we’re forced to make a move sooner than expected. My point is, if you plan on staying in your new home for awhile then don’t get too hung up on the buy low-sell high philosophy. Find the home that’s right for you and don’t worry about the rest of it. Time-and-again history has proven that over the long-term real estate is almost always a good investment and typically speaking you will likely come out ahead.

///…CP