Buyers are often questioning whether they are paying too much for a home. But what about sellers? How much is your home costing you to keep? Depending on where you are in the selling process, this is something you need to consider.
The most obvious scenario involves a vacant (or essentially vacant) home where the seller has already relocated to a new home. That seller continues to meet monthly ownership obligations, which usually include mortgage payments, property taxes, homeowner’s insurance, utilities and yard upkeep. If you are looking at the possibility of carrying two homes at some point in your moving process, think carefully about whether you are paying too much to carry the old home month after month, or does it make more sense to adjust your asking price down or work with an offer that comes in lower than you would have hoped? Even if you have to bring some money to the table to satisfy a loan you took out a few years back when money was flowing more freely, that may be cheaper than carrying the home for months or even years hoping to recoup a lost idea of value.
But what if you haven’t committed to buying a new home, but have only listed your home with the hopes of making a move? Is it still possible that you could be paying too much? If what you need is to move to a smaller or less expensive home, then yes, every day that you hold on to your old home, you are paying too much. Marketing your home aggressively and being realistic on price will in the end save you significant money when you get your old home sold and get into a new home that costs you less each month.
But even if you are moving up, you may still be paying too much as a seller. Staying too long in a home when you know a move is what is needed may have a lot of hidden opportunity costs – you might miss out on the great rates that are currently available. You might be forced to pay for unexpected repairs because you stayed just a little too long and costly items started to break. You might miss out on a great deal because you haven’t positioned yourself successfully as a buyer. These are all high prices for a seller to pay. End message: price your home well, consider all offers and be realistic about realization and while you may initially think you are losing too much, in the end, you will prevent yourself from paying too much.