Assessing an Upgrade

Q: "Mike, I am struggling over the fact that it is a great time to buy but I don’t have any liquid cash to do so. I don’t mean to exploit someone’s financial distress, however, I’ve identified a home in a location I’ve wanted for years that seems to have a selling price created out of urgency. In Provincetown dollars of course it is still pretty high, but manageable for me if I can sell my house and apply the equity. Is it realistic to think that I can sell my property in this market and upgrade to this house in what I perceive as a better location? Should I wait for the house to foreclose?" - Matthew, Provincetown

A: Thanks Matthew and this is a very good question. Let me start by strongly advising not to wait for a foreclosure. In Provincetown, the foreclosures we’ve seen have not been Earth shattering deals. If you identify a property you like and the seller has disclosed extreme motivation, you are in the driver’s seat for a great deal. Maybe even a short sale. Once the bank takes over, they attempt to hold to their bottom line and recapture some of the expense of the actual foreclosure.

The real estate market remains soft. We are definitely seeing activity but 2007 is in line to be a slower year than 2006. However, with that said, what is selling is property priced according to the market conditions. I’ve said this before and I’ll say it again. Property priced right in any market sells. Priced right does not mean pricing high and it does not mean under-pricing either. 

If you have sizeable equity in your home and you can afford to price it competitively. Then I recommend you go for it. The perceived loss on what you’d want to sell your existing property for in a stronger market will be re-couped in the appreciation of the home in the better location, not to mention the happiness you’ll feel achieving the goal of living in a location you really want to be in.

Consult your realtor and you’ll see that there are many incredible opportunities out there. Go for it and next year you’ll be thankful this week, that you made the move. Remember, in the current market, it is taking 9 months to one year to sell prop.