Moving On Up...

I was recently asked for some insight from clients, friends and neighbors what they might want to see on my blog.

Jen wanted me to talk about moving up from your first house to a bigger home to accommodate a growing family and changing needs in a home.

If is very common to purchase your first home you find your needs have changed.

Maybe you had kids and then figure out the house you are currently are living in is too small, is not in the school district you would like, you may want to live in an area that is less urban, or maybe you want to be closer to amenities and public transportation. You will need to evaluate your situation and how your needs may have changed.

The first step would to be to sit down and really think about what you want in a new house and write it down!
**How many bedrooms and bathrooms to do you want?
**Do you want a house with no stairs?
**Is there a particular school district you want to live in?
**Do you want to live in a more suburban setting?
**Do you want to live closer to public transportation?
**Do you have a particular city or community you want to live in?

Write down everything. Remember this is what you want. This list may change, but get it all down on paper.

Now evaluate your wish list with your current house. Do any of the your wants match what you currently have?

The next step you may want to enlist the help of a Realtor. You will need to evaluate your current home as if you were going to sell it. What kind of equity do you think you might have to use to help with the purchase a new home?

Have a Realtor help you with a market analysis of your home so you have some ballpark figures to work with.

You will need to evaluate the marketplace for you current home as compared to a home in the area you would like to move. Again your Realtor can help you determine what the marketplace is doing in the areas you are interested in moving to.

If you live in an area where homes are going for $500,000, upgrading to a home for 2 million may not be realistic (unless you have the winning lottery ticket).

The market has changed and the strategies for selling and upgrading to a new house have too.

Be realistic.
Housing prices have changed. Keep in mind a 5% decrease in prices in a home worth $500,000 is only $25,000 and a 5% decrease in prices in a home worth $800,000 is $40,000. The neighbor up the street may have sold their house 2 years ago at $100,000 over asking, but in this current marketplace this more than likely won't happen.
Be smart.
It may be a much better approach to sell your first home and then look to buy the upgrade. It will also be a lot easier to take the proceeds from the sale of your first home and directly use that money to help with the purchase of the new one.
Think Like a Buyer
--Even when selling your house. In any market the buyers are the one's who set the prices. What buyers are willing to pay for ultimately sets the stage for the sale of your home.
Get Help. Use a Realtor and lender to help you evaluate your situation. If you can sell your house and reap a fair amount of equity, but can't qualify for a loan for the second home, you may want to reconsider what your options are.

Selling and buying a house can be a very stressful time. There is a lot to do and emotions can run high. There will be certain roadblocks that can cause bumps in the road to you ultimate goal of upgrading to a new home, but with the help of a qualified Realtor and lender you can be on the road to your new home.

If you have any comments or questions regarding moving up to your next home, you can contact me at lcartolano@apr.com or at 510.213.1139