After taking her employer’s early retirement offer, an engineer in her early 60s -- an ardent tennis enthusiast --began attacking her bucket list. As her first check-off, she flew to Paris for the 2022 French Open.
Upon her return from France, the engineer -- who was recently widowed -- took a closer look at her financial picture. In particular, she reasoned this would be the ideal year to sell the contemporary lakeside house she and her husband had custom designed 27 years ago.
“This fabulous seller’s market can’t last much longer, especially now with the economy weakening and mortgage rates rising. That’s why I want to sell this year to avoid missing the boat entirely,” the widow says.
Like a number of other homeowners, she worries the rise in home valuations that’s occurred since the start of the pandemic is unsustainable. She would love to hang on to the lakeside property -- to which she’s emotionally attached -- but fears waiting to sell will cost her.
“Some people think we’re in a bubble and home prices will plummet like they did more than a decade ago during that big surge in foreclosures,” says Mark Nash, a real estate analyst.
Actually, many housing economists are skeptical that home prices will fall in the near future, eventually ushering in a buyer’s market. They contrast the current period from the last major recession, when homebuyers ruled.
“Although the Great Recession was triggered by a housing crash, it’s an outlier in the grand history of recessions, which have often strengthened investment in housing, due to its relative stability as an asset,” says Nicole Bachaud, an economist with Zillow, the national real estate company.
Zillow recently conducted a survey of housing experts, who were polled on whether they believe the real estate market is in a bubble. Of those surveyed, 60% do not believe the U.S. housing market is currently in a bubble, compared to 32% who disagree. Eight percent aren’t sure.
“Americans have seen home values rise at record rates over the past few years. But although a recession is looking more likely, the housing market today is a far different beast than what we saw in the mid-2000s,” says Bachaud, noting that lenders now require much stronger income and credit metrics before approving mortgages. Also, available homes are in short supply relative to demand, especially from young-adult purchasers.
Still, the retired engineer -- who is risk averse when it comes to financial matters -- doesn’t want to chance a delay in the sale of her home. She recently called in three real estate agents and plans to soon list with one of them.
“My only large concern about selling now is that it’s very hard emotionally to let go of the house where my husband and I had so many happy years,” she says.
Here are a few pointers for sellers:
-- Conduct a wide search for your next home before selling.
With more than 20 years of experience selling real estate behind her, Ashley Richardson, of the Long & Foster realty firm, has gained a key insight into the emotional bond many people have to a longtime residence. She says it’s often possible to transfer this attachment to another home.
Consequently, she recommends that sentimental sellers start looking for their next residence as soon as they put their property on the market, or even earlier.
“This way you’ll more quickly detach from the house where you’ve been living for a long time,” says Richardson, who’s affiliated with the Residential Real Estate Council (crs.com). However, she urges those making a housing transition to restrict their property search solely to neighborhoods with homes they can afford, so as not to set themselves up for disappointment later.
-- Review your housing plans with your grown children.
Nash, the author of “1001 Tips For Buying and Selling a Home,” says many empty nesters fear that letting go of a long-held property will mean fewer visits from family members -- including their grown kids and grandkids. Yet lots of would-be sellers are also anxious to liberate themselves from the carrying costs of a large property.
To address such fears, Nash says it can be wise for sellers to discuss these anxieties with their offspring. Perhaps future multi-generational family visits could be centered in a resort area where all could spend quality time together.
“You might be pleasantly surprised at the lengths your family members would go to see you on their vacation days,” Nash says.
-- Try to neutralize your property by removing memorabilia.
To break the emotional ties to their property, it helps many people to sort through and remove sentimental items. Nash says you’ll want to cull through your family memorabilia, eliminating all but the most precious of items.
Nash suggests you also give away or pack away many other family-related items, including toys and children’s books. And he recommends you remove family photographs from your walls.
Neutralizing your property will not only help you detach from the place emotionally, but it will also make it easier for you and your listing agent to attract buyers.
“People aren’t going to pay more because your house is filled with memories. In fact, having lots of memorabilia on display will only slow the sale of your property, because it keeps people from picturing themselves living there,” Nash says.
(To contact Ellen James Martin, email her at firstname.lastname@example.org.)