For those who are in the midst of selling & buying.. (a little long)

We are trying to figure out what the hell to do.

In Sept, we will have been in our apartment for 5 years. We have a 5 yr adjustable mortgage, which expires then so we will need to refinance. We have lost about $75K to $100K in the value of our home, AND we have also put a little money in so we are getting *NO* ROI. However, I think if priced right, we will sell pretty quickly since our place shows very well.

We are looking to sell and move to a house in the burbs. I know that if we buy and sell in the same market, it's a wash-- we are selling for less and buying for less.

The issue is the down payment and "losing" money due to overall home value. We essentially lose the down payment we put on this place, 10%, since our home value has dropped so much. We fortunately have access to capital so we don't NEED that money, and can put a lot down on a new home so we can get a comparable mortgage-- but we are looking to upgrade.

According to the CNN chart someone posted, NYC prices are poised to drop signifcantly (+10%). I live a mile outside of Manhattan and if Manhattan prices are going to drop so much-- why would the price of my apt rise enough to make up for the big drop? The reason why my home has value, is the proximity to Manhattan. If someone can get a comparable apt for a comparable price-- why would they move to Hoboken? Other than the fact is like a nice happy medium of urban, without the major hustle and bustle of Manhattan and a nice place to have kids and a short commute.

So the question is... how long do we wait? It's not necessarily a financial issue to wait-- although we certainly don't want to throw money out the window. With a 14 month old who will be full on walking in a few months, this place will feel much smaller very quickly. And we are also looking at storage facilities since we have no room for all our crap.

So it's weighing life needs vs right financial decision. I'd rather stay here for longer than moving into another temporary, i.e. 5 yr home. I am also worried if we wait too long, we get screwed again one way or another.

That's our story-- any words of wisdom?

Re: For those who are in the midst of selling & buying.. (a little long)

You could always put your house on the market for a 3 month contract and see where it takes you. I think this is the option I would go with.

Re: For those who are in the midst of selling & buying.. (a little long)

yeah-- my first step is to make an appt to go house hunting in the areas we are interested in-- to get a sense of how much we need to spend to get what we want...

I know what we can prob sell this place for though, and it ain't pretty!!!

I am just not sure if waiting-- since we can't wait years-- is the right thing. Or if we bite the bullet, take advantage of low interest rates, the home buying tax credit, etc.

Re: For those who are in the midst of selling & buying.. (a little long)

Re: For those who are in the midst of selling & buying.. (a little long)

hmmm didn't know the tax credit ended so soon-- I knew it was extended.

Anyway.. yeah, I feel like we are just lame ducks here, and if there is no point in waiting-- why should we?

I was looking at a few listings in the area we are considering on Zillow and it seems a lot of them look empty and/or staged-- people prob need to sell, and we may be able to take advantage of an oppty.

I put a call into my broker here and am going to talk to them too, to see what the sitch with selling is.

Re: For those who are in the midst of selling & buying.. (a little long)

do you live in Hoboken?

Re: For those who are in the midst of selling & buying.. (a little long)

Re: For those who are in the midst of selling & buying.. (a little long)

Randi, I say just bite the bullet and go for it now.

We are selling and buying, with DD walking we just need more space. So even though we will be losing $, we are also losing valuable time. And we are just not happy here so that's important for our overall well being and DDs everyday life.

JMO

Re: For those who are in the midst of selling & buying.. (a little long)

Re: For those who are in the midst of selling & buying.. (a little long)

I suggest renting your place. You may even get enough rent to cover some of your new monthly expenses.

Hoboken is very desirable.

Rents in NYC are starting to stabilize.

I would keep that apartment since you don't need the cash from it to buy the next.

Re: For those who are in the midst of selling & buying.. (a little long)

I hear ya! Our situation is kind of similar. We own a co-op (1 bedroom) and know that we want to start a family and have out grown what we have.
We started looking at houses in the areas we were interested in and when we started finding more and more that we liked we decided to put the co-op on the market just to assess what the interest on the place would be. To see if people would put offers and if so how much they would put. We really didn't think that people would put offers in right away. We showed it to 6 people and got 6 offers all on the same day. We ended up selling for about what we bought for (we renovated the kitchen so we put money into the place, but ultimately that's what made it sell so fast). We accepted an offer and started moving on some of the houses that we liked.

It's a sticky situation b/c it's never going to feel like the right time and you never know what is going to happen.

I would do what others suggested and what we did which was to put your feelers out on what you want to buy and put your apt. on the market to see what kind of interest people have.

Good Luck!

Re: For those who are in the midst of selling & buying.. (a little long)

We are in this situation.

The way we look at the selling low part is, that since we are buying low, we are saving a ton of money on the interest on the new house (not to mention the lower price) In our situation, the 100K lower price tag saves us an additional [almost] 100K in interest over the life of the loan (not to mention that interest rates can only go up in the years to come). So if we lose 50K selling right now (which it looks like we will), we are actually still gaining 50K in savings.


Renting could be a good idea, but if your salary cannot cover 2 mortgages easily, you need a signed lease and they only count 75% on the rent (so you have to be able to cover the new mortgage plus 25% of the rental mortgage)

As for your ARM - it will probably go down - so don't let that make your decision.

Re: For those who are in the midst of selling & buying.. (a little long)

We were in an almost identical situation - our co-op right outside of Manhattan dropped in value so we weren't really going to get much back when we sold, but we had separate money for a down payment on a house.

We decided to sell the co-op and buy a house in the 'burbs. Our theory was that while we were selling for a "loss", we were more than making up for it with the purchase of our new home. We didn't see it as a wash because our house cost about 3x more than our co-op - so the 10% loss on our co-op was substanitally less than what we theoretically "saved" on the purchase of our house by buying during a low time. I'm not sure if that made sense!!

I think that if you are looking to buy a house that is going to cost more than your condo, then you should definitely sell and buy the house.

I also will add that we priced our co-op right and it sold in a week so you could probably sell pretty quickly even though that market isn't great.