Your first home – your starter home, which you scrimped and saved to buy – will always hold a special place in your heart.
That tiny condo in Brighton.
The studio in the South End.
The 1950’s cape out in Auburn.
The 1-bedroom garden-apartment condo that served you and your dog well before meeting your future wife.
As with most things in life, though, there comes a time when you should move on and sell your starter home (or, if you’re lucky enough to have money for a larger down-payment, keep it and rent it out).
But how do you know if that time is now? If you’ve been thinking about selling your starter home and upgrading, you need to read the signs – otherwise, you could be making a huge mistake. Here are 5 signs it is time to sell your starter home and look for a bigger home in Boston.
1. Your and Your Family’s Needs Are Different
One sure sign that it’s to sell your starter home and look for a bigger home in Boston when your needs personal change. Most often this means a growing family, but it could also be a change in financial circumstances, new job, or other lifestyle factors.
You would need to sell your starter home and look for a bigger home in Boston if you found yourself in a situation: like this – let’s say that you purchased a one-bedroom starter home five years ago when you were single and dating. Now you’re married for two years and have a baby on the way in a few months! While you could technically have your newborn share your bedroom, things will feel cramped rather quickly. You’d rather have a second, or better yet a third or fourth, bedroom for your growing family and any guests coming to lend you a hand.
Or maybe you had enough bedrooms for you and the kids, but now you and your spouse find yourselves working primarily from home due to COVID-19. In this situation, you’ve likely had to convert a bedroom into a dedicated home office – so now you’re a bedroom short. The only good solution, then, might be trading up, selling your home, and upgrading to a larger one with more bedrooms.
2. You Can Actually Afford It
Another one of the top signs that it’s time to sell your starter home is when you can comfortably afford it. Mortgage rates remain at record lows at the moment, so you might qualify for higher amounts of capital. Or, perhaps your income has increased substantially or you’ve gone from a single-income to a dual-income household. In any case it might be a good move to sell and buy a bigger Boston home. Doing so would be both reasonable and justified.
But do make sure that will be comfortable for your budget, not just an impulse move. You also need to factor in more than just the larger mortgage payments. Both property taxes and homeowners insurance (among other things) will go up. So be sure to reach out to us at NextHome Titletown Real Estate to find out about these costs as well as all the other expenses associate with an upgrade. To find out more, call us at (617) 657-9811.
3. Your Home Has Appreciated or Needs Major Upgrades and Repairs
If your property has appreciated significantly, that’s often an indication that you should sell your starter home and look for a bigger home in Boston. If you happened to buy in a really good neighborhood that’s appreciated significantly since your purchase, it may be smart to sell the home and capitalize on your good fortune. This equity can then be put into another home purchase in the same neighborhood, or in another up-and-coming location.
Or, if your starter home is in need of major upgrades and/or repairs, it may be time to sell. If you’re looking at putting in a new HVAC unit or replacing the roof, selling may make the most financial sense. In this scenario, you’re likely better off selling than pumping tens of thousands of dollars into those upgrades and repairs, and letting the next owners work though those upgrades in the manner that best suits them.
4. You Want to Build Wealth
The fact that you’re ready to start building more wealth may be a sign that it’s time to sell. If you sell your starter home and buy a bigger home in Boston, you can really start accumulating wealth.
When you upgrade to a bigger and better home, you will be able to begin building equity in that more valuable home. In addition, as the home appreciates, your equity grows, plus you’re leveraging that higher down payment for an even higher dollar return.
And if you can swing it because your debt-to-income ratio allows, you might even be able to keep your starter home and rent it out. This will provide you with another income stream to help you build wealth. Passive, recurring income from cash-flowing real estate is one of the top ways to build wealth.
5. The Market Conditions Are Favorable
Finally, you should sell your starter home when market conditions are favorable, which in most corners of the Massachusetts real estate market, they are. Suppose, for example, that interest rates are low and the local market is hot – both conditions true right now – selling a starter home makes a lot of sense.
So, is it time to sell your starter home and look for a bigger home in Boston?
Only you can make that decision, but your Boston real estate agent at NextHome Titletown Real Estate can provide a lot of valuable guidance. We know exactly what’s going on in the local market, what additional expenses are involved, and whether the new home will actually meet your needs. Don’t make a mistake – contact one of our experienced agents today. Send us a message or give us a call at (617) 657-9811.
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