How Long You Should Live In Your Home Before You Sell It
Wayne MorganPosted on 10 Sep 2019
Whether you just moved in or have lived in your home for 50 years, it's common to wonder how long you should stay in your home before you sell it. According to national research, ten years is the average amount of time that a homeowner will stay in their home before deciding to sell it.
If you're under ten years and itching to sell, many experts say you should follow the “five-year rule” and stay in the same home for at least five years before selling.
This may sound like a long time and you may think you are ready to sell now, but before you make any rash decisions, we put together a few of the most important factors that you should be aware of.
1. Your Mortgage
One of the first and foremost factors you must consider when you decide to sell your home is your mortgage payment. If you want to make money
when you sell your home, then your sale price must be greater than what’s left of your mortgage. When you first buy your home and begin to pay
your mortgage, the first few years will go towards interest rather than the principal amount. This typically means that it’s more difficult to make money off yoursale under 5 years. However, if you put a larger downpayment on your house, then your interest rate and mortgage will probably be smaller, making it possibleto make money in a shorter amount of time.
Building home equity is important. You’ll want to have a lot of equity built up when you decide to sell. The amount of home equity you’ve obtained
depends on any remodeling or renovations you’ve made, as well as your mortgage. If the home you bought was already in tip-top shape, then it
may be difficult to build equity. If you’ve remodeled the kitchen, bathroom, redone the flooring, or made other renovations around the house, then you have
most likely gained home equity. You can also increase your home equity by paying off more of the principal on your mortgage.
3. Market Conditions
One of the more common reasons you’re eager to sell your home is to make money on your property. There are a few things to look out for when
deciding if it’s a seller's market and whether or not it's time to make your move. If you notice the price per square metre in your area is increasing
chances are that homes stay on the market for a shorter time. You should also take note of homes near you that are selling. It might seem time-consuming, but
don't worry! We always keep track of recent home sales in the area and can send you over an up-to-date market report.
Request A Market Report
We have exclusive access to past sales close to your home and we know what the market currently looks like
4. You're Out Of Space
Maybe this was the first house you bought when you were expecting your first child and there were only three of you, but now with three kids and
two dogs, there isn't much space. Although it may be sad to move out of the home where you started your family, the happiness of your family
may be greater than the cost of selling your home and buying a new one.
Other life situations like divorce, illness, or even the need to downsize may also lead you to sell sooner than you originally planned.
5. Capital Gains Tax
If you don’t qualify to avoid paying capital gains taxes on the sale of your home, you may not want to sell your home yet. To avoid capital gains
taxes as an owner-occupier, you should make an effort to stay in your home for at least one year. Making a sale before the first year could be a
huge mistake, and could ultimately leave you without much equity, especially if you have to pay capital gains tax.
6. Moving Costs
Moving costs are often overlooked but play an important part when it comes to selling & buying a home. Some of the cost that incur include; real
estate agents commissions on a sale, stamp duty on purchase (varies state to state), conveyancing fees to solicitors, and let's not forget the
removalists, cleaners and maintenance men you'll have running around. Keeping moving costs in mind before you sell allows you to budget this into your
expenses and avoid surprises when it comes to settlement.
So, Is It Time To Sell?
If you've already taken these factors into consideration
and decided that it's time to sell, take the first step and
get your home's value. If not, no worries! We're here for