You’ve lived in your home for a few years, and you’ve heard nonstop news about the housing market. Record appreciation rates and a hot seller’s market here in Raleigh make it seem like a great time to sell, but are you ready for your next home?
To answer this question, first decide if you’re ready to let go of your current home. Then take a thorough inventory of your financial situation, and consider the market. There are incredible benefits of selling your home in a low inventory market, but once you do, you reenter that market as a buyer facing steep competition.
If you’re ready to jump into a fast-moving market, and the following five points apply to you, there’s a good chance you’re ready for your next home.
Your current home no longer suits your needs
If your current home no longer meets your needs, you’re most likely feeling it already. This is common for people in transition. If your household has grown recently or is about to, you may need more space—extra bedrooms, a bigger yard, and a dining room where everyone can eat together.
But if you’ve recently become an empty nester, there’s a chance that big home is too much—too much space, too much to clean, and too much to maintain. In this case, downsizing would be a better option and could leave you with a significant amount of money due to Raleigh’s sky-high home values.
Sometimes needs change without relation to size. If someone in your household recently became disabled, a ranch-style home could suit you better than a multilevel home with stairs. Perhaps you’ve taken up an important new hobby or side-hustle that requires more outdoor space (like gardening) or a shop (like woodworking).
Whatever your needs, your home is supposed to accommodate you, not the other way around. If it’s not, you’re probably ready to move on.
You want a change
Even if your home still serves you logistically, it’s possible to want something new—especially after the last few years. Most of us spent more time at home than ever before, and that has led to burnout. Work-from-home is up 142% overall since 2019, and Raleigh ranks in the nation’s top 10 cities for telecommuting.
That commute reduction is great for traffic, the environment, and our wallets—but it also means we don’t leave the house as much or spend a significant amount of time in another environment. If all day every day in your home has led to dissatisfaction, it may be time to look at new homes in new neighborhoods.
You're emotionally over it
A home is so much more than four walls and a roof. When we’re in the right one, we feel peace, happiness, and a sense of pride in the space we create. Our homes are where life happens, where relationships develop, and where we strive to build our futures. Just as it does between people, going through these ups and downs in a home creates a strong bond.
If fact, a 2017 study showed that the emotional connection people have to their homes is as strong as the connection to pets and people. If you’re no longer feeling that connection, it could be a sign you and your home are ready to break up.
Emotional detachment from a home is a signal to move on, and it will also lend you an impartial eye that makes it easier for you to sell.
You're financially stable
If you’re financing the purchase of your next home, you’ll have to show lenders that you have a stable source of income. You’ll usually have to show two years of tax returns or paystubs from one secure job or positions in the same field.
These rules aren’t hard and fast. For example, self-employed individuals can use tax returns and profit-loss statements to make their case, but you need financial stability to qualify and for your own peace of mind. You don’t want to move into a mortgage that will financially strain you, especially if you’re in one that works for you right now.
If you’re stable, we say go for it. But if you’re far from the mark, you may not be ready to buy your next home.
You have savings and equity
To purchase a second home, you usually need to have 20% of a home’s purchase price available in cash to purchase it. In Raleigh, that’s around $87,300 for the average home, plus closing costs. In a competitive market, you may need more still. All-cash home purchases in Raleigh currently account for one-third of all purchases, up 25% from last year. Factor in the costs of selling your current home, and you need to have a significant amount of money saved up in cash to move to the next one.
Fortunately, some of this cash can come from the sale of your previous home sale in the form of equity. Equity is the value of your home minus the amount you owe on your mortgage. For example, if your home is worth $700,000 and you owe $550,000, you have $150,000 in equity. When you sell your home, you’ll receive this amount less the fees associated with selling, and you can use it to finance your next home purchase.
If you have equity in your current home and significant cash savings, you’re likely financially ready to purchase your next home.
What if you need to buy and sell at the same time?
At The Coley Group, we understand how overwhelming it can be to try to perfectly time two home closings in a high demand, low inventory market. That’s why we created our exclusive Buy Before You Sell program, giving you more buying power with an all-cash offer and no sale contingencies, as well as the ability to close in 14 days.
Through this program, you can move into your new home without having to sell first. Then you can repair, stage, and sell your home on your own timeline, without having to worry if bumps in your home sale will affect your purchase.
Finally, if for some reason you don’t love your new home after you move in, we will buy it back from you any time in the first 12 months.
Interested in learning more? Complete the form below and an expert will connect with you to help you find your next home, today.
If you're not ready for your next home, but are anxious to know your current home's value – here's a free, no-strings-attached home valuation to get you started.