Can a seller win in this marketplace?
Despite common sentiment the simple answer to this question is a clear YES! The sellers that are likely to come out of the present market down turn smelling like roses, are those families trading up. How so? Well lets do the math to illustrate this. Imagine that you are a home owner with a $500,000 home (in todays money) and you wish to trade up to a $700,000 home, feeling disappointed that the value of your home has recently suffered, your initial feeling is to wait for the market to lift, as having the most equity possible to take to your next home, is high on your priority list. Then tapping on your calculator shows you something else. That is, when you add 10% to your $500,000 home it goes up $50,000 and when you add 10% to a $700,000 home it goes up $70,000 in other words the same market that is likely to increase the value in your present home is likely to increase the value in your future home as well, as waiting for your own equity to increase effectly costs you $20,000 (that is $70,000 increase in the home your buying less $50,000 increase in the home that you are selling).
What are your views on the market place?