The current market presents one of the greatest buying opportunities in the history of real estate in the United States! Prices, coupled with low interest rates may make this the best time to purchase in this century. This is particularly true if you are a seller looking to become a buyer and I’ll tell you why in a moment. The market is relatively inert compared to market activity in recent years. There is a lot of indecision all over the country. If you are a seller-buyer (that is selling you home and looking to buy another one), and if you believe that in the long-term real estate values will go up, now is the time to buy without question.

If the market is going down, sell you house now by pricing it properly for this market. Once you close escrow or during escrow, buy that bigger home you’ve wanted. Here’s the conclusive logic using real numbers. Suppose you bought your home at $300,000, it went to $500,000 and is now priced at $400,000 in value. Sell it, assuming you can, and want to buy a more expensive house! You’re going to make $100,000 (less costs related to the transaction). Don’t worry about the equity you lost and here’s why. While you are in escrow on the home you sold, the market is continuing down. If the home you own has come down 20% in value, it is realistic that the home you’ve wanted for $650,000 has also come down 20% in value to $520,000. While you are in escrow, it may to at lower price. If the market starts back up, at least you’re buying that bigger home at or near the bottom of the market.

So, while you made less than you’d hoped for on your home, you figuratively “saved” that amount of money, or more, that the other home has also dropped in value ($650,000-$520,000 = $130,000 a 20% reduction) during that same period. If the value of that home drops lower between the time you sell and the time you buy it, you’ve made out even better. If you wait, there may be a big problem. Instead of selling at $400,000 when you could, assume the price of your home goes lower, down to $350,000, eroding your ability to make a down payment on the higher valued home.

Further, assume that you waited until the market hit rock bottom and started back up. Now the opposite is true. You sold your at rock bottom pricing and now you are chasing a rising market. If $520K was the low point of your move-up home, it may bump to $540 or $550,000 while you’re in escrow if the seller reacts to the rising market. In fact, they may hold on for higher pricing and you’re stuck having sold lower and having purchased at a higher price point than you needed to, had you acted earlier.

The Market is the Market and one person can’t change the economic events that shape real estate values. However, if you take advantage of the opportunity the current market offers, there is a strong possibility you’ll pat yourself on the back in the not-to-distant future. I would also remind you that real estate interest rates are again near historic lows. That means that you’ll also gain the advantage of cheaper money which will help you in that purchase and in the future.

What does it take to get there?

1) First you have to believe that real estate values will go up or this logic blows up.
2) Get your home ready to sell.
3) Price your home to sell, not to sit on the market.
4) Take all offers seriously. Remember, if you’re buying another home, your current home is an important vehicle to help get you there. If you have to take a little less, offer a little less on the home you want.
5) Target the home you want to purchase and begin the process of buying.
6) Act! If you wait, the market opportunity may pass you by.

Buyer and seller should understand this notion. Real estate agents should explain this logic to their clients so they understand the ramifications of waiting too long and trying to “pick the bottom of the market”. Have you ever said to yourself, I should have bought or sold that (house, stock, car) and didn’t? I have, and it can be a painful thought.

Real estate is “on sale” for the first time in a long time and you owe it to yourself to take advantage of this opportunity.