Selling your current house for a
bigger or "better" one is an enticing prospect, but you need to
carefully assess your budget and determine how much more money
you can realistically spend each month on housing costs. Take a
close look at your checking account and credit card statements.
Also track how much you spend on "extras" each
month--miscellaneous expenses that you don't necessarily budget
for.
The reason these things need to be so carefully considered is
that most likely, if you trade up, your mortgage payment will
increase, but that is only one of many increased costs you will
face. Along with your increased mortgage payment comes an
increase in property taxes. A call to the local taxing authority
in the area where you want to purchase a new home will give you
an accurate idea of what the newly reassessed taxes on a home
will be.
Other increased expenses in more upscale homes can include
monthly utility payments. If you are buying a home with
increased square footage, unless the home is more
energy-efficient than your current residence, you can expect to
pay more in heating and electric bills. With the additional
space also comes the need for more furnishings.
Additional increases on more expensive homes are seen in
homeowners insurance premiums. An accurate estimate of the
increase can be based on the increase in square footage of the
home. All of these items combined will help you to estimate your
new housing budget.
Conversely, you might one day decide you do not need as much
space as you're currently living in, and you might decide to
trade down for a less expensive home. This is a common decision
made by those approaching retirement age. Fortunately, tax laws
now are such that home equity can be converted into investments
that retirees can live off of.
Selling your home for a less expensive home or to move into a
rental property is a major decision and should be done only if
you are well-informed of your options and/or you have sought the
advice of a financial advisor.
Tom and Kathy
Stowe are Philadelphia Area Multimillion Dollar Producers who
specialize in Real Estate on the Main Line--as well as Havertown,
Drexel Hill, Wynnewood, Newtown Square, Marple, Media and
Springfield. Call 610-645-3823.
Tom and Kathy Stowe (610)645-3823 Office Line (610)649-7410,
43 Haverford Station Road. Haverford,
PA. 19041
Email: info@homesonmainline.com
Prudential Fox and Roach Realtors is an
Independently Owned and Operated Member of The Prudential Real Estate,
Affiliates, Inc.
