Selling After Buying High

Trying to explain buying and selling real estate in the United States over the last three years is like trying to pick an idiom for explaining impossibility. It’s, just, like… really hard. Numbers went gangbusters and haven’t quite leveled out. Some areas, like interest rates, keep growing. While others, like equity, have started to shrink. 

Home equity in 2021 reached a staggering and breathtaking peak: Americans held $17.6 trillions dollars of home equity in May of 2021. This was due to a whopping 45% increase in home prices. That number has slid ever so slightly. As of September 2022, equity dropped to $16.3 trillion. 

What happens, though, when you bought at a price peak and are now trying to sell? Here’s a bit of insight about how to ride the real estate roller coaster. 

Take the Hit

Sometimes it just is what it is. If you bought during a high time and then circumstances beyond your control have forced you to sell quickly, you might just have to accept taking a loss. While it’s definitely a financial burden, people have recovered from worse things. 

Rethink Loss with Rent

If there’s simply no other option than leaving a home you recently purchased, consider renting it out. While this isn’t a perfect solution, it’s a way to continue building equity especially if you are able to also rent your new housing situation. Steady rental income coupled with potentially cheaper household expenses for yourself might balance out in the end. 

Take a Huge Risk

Now, this one requires planning, consulting with financial advisors, and plugging your nose a bit. Disclaimer: It might not work for everyone, but is worth considering. If you bought at high peak and now are faced with selling at a loss, consider a high return-on-investment renovation. If done well, said renovation might be enough to not only recoup the associated cost but it could tip the value of your home in your favor. Again, not the easiest sure-fix but it could work!

More than anything, speaking to a licensed agent who knows your local market can make a world of difference when buying and selling. Contact us today!