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My wife and I have owned a condo for almost three years.
We've begun talking about trying to have a kid in the next year or so. We live in a 1,050-sq ft 2/2 unit, which may be a tight squeeze for a family of 3.
I'm assuming it doesn't make sense to sell my condo unless/until it's worth more than I owe on my mortgage. I've read that you should live in a property at least 5 years before selling it, or else you'll surely take a hit.
Is this info accurate?
Also, I've read on Trulia that it's better to sell a property, then worry about buying the next one. That way, you can use the funds toward the new property and aren't stressed out trying to do two things at once.
I'm not interested in being a landlord, and I figure that if we have to rent somewhere for a while after selling the property, so be it.
I put 25% down on the condo. I'm guessing the payoff amount includes the principal and interest, plus closing costs?
Please advise. I've never sold a property, so this is all new to me. Thanks.
Last edited by Wordsmith12; 11-21-2017 at 08:34 AM..
If you sell your condo below what you owe on the mortgage, you will certainly 'take a hit, since you must still satisfy the mortgage regardless of what you sell the condo for. Also, don't forget about closing costs and RE fees on both properties, plus moving expenses. Unless you sell for more than you owe on the mortgage, there will be no funds to apply toward the new property. Ask your mortgage holder for a payoff number.
5-years is probably a reasonable rule of thumb based on a "typical" RE market, but, the determining factor on value is the current market. Condo sales in your building will give you a pretty good idea of the market value. Kids and their toys, swings, playpens, etc. take up a disproportionate amount of space already and a 1050 sf condo will only get tighter as he/she starts to grow and move around. Be sure you account for this when selecting a new condo or you are likely to find yourself needing to move again before you are ready.
1. do you think your agent from 3 years ago did a good job; if yes, then reach out to them to get a current value.
2. Hopefully if you put 25% down 3 years ago, the value has increased and you'll sell for WAY above your mortgage balance.
3. Where are you located (in terms of where your market may be on the rising values curve)?
4. Do you work from home? If yes, then I wouldn't introduce another human. Babies take almost as much space as the 2 parents combined.
Yes, when you get there, you'll want to sell first (at least be under contract) then buy. While you're chatting with your agent (see #1), go ahead and also contact a mortgage lender to see what you should budget for the next house. And then ask your agent to show you what that gets you in the next home.
You can always write a clause into the sales contract that you will be occupying the home after the sale as a tenant for a certain amount of time. We did that, as a contingency. Turned out we didn't need to exercise the clause, but we had it there just in case.
We lived in a 850 sf 2/1 house with 2 kids until the youngest was nearly 5. So yeah, it can certainly be done. It was 'cozy' but made for lots of good memories.
Everything to do with real estate is local. There are "rules of thumb" and "conventional wisdom" but nothing applies to all areas and all time periods.
I wouldn't worry about moving until the kid is getting ready to start school.
You can definitely have a baby in that condo, and then decide when you are ready to move afterwards - you should be fine for at least a year, longer depending on how much stuff you have and how much you decide to get for the baby. And yes, it's a decision for the most part, not a "need" to get lots of baby gear. If you have less room, you get less stuff and make do. Many people prefer to have the baby sleep with them in their bedroom (not necessarily in the same bed, but setting up a crib in the bedroom) so you may not even have to give up the second bedroom to start with, at least not all of it, unless it's quite small.
Plus you aren't even quite at the point of trying, and don't know how long it will take. Even with good results, if you try in a year and get pregnant quickly, you are still looking at a couple of years before the baby is even here. Of course no one can predict what the real estate market will do, but unless you want to sell as a hedge against prices dropping, you may as well stay, continue to build your equity over time and then look to sell when you are actually experiencing the need to for more space rather than simply anticipating it.
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