Tag Archive for home ownership

How Long Do I Have to Live Here?!?!

How long do I have to live here?!?!  When buying your first home, one of the first things you should consider is how long you plan to live there.  This could affect what type of property you buy, what your overall strategy is, or if you even end up buying at all.

Why does it matter?  When you sell a home in Washington State it will generally cost you about 8.5% of the overall sales price.  This amount should cover realtor commissions, excise tax, etc.  In most cases (not including the last several years), the longer you stay in the home the more likely you will gain enough appreciation to cover these costs…and hopefully a bit more to turn a profit.

Is 12 months long enough?  Usually 12 months is not long enough to realize enough appreciation to cover your liquidation costs.  However, it might be if you are planning to put A LOT of work into the home.  Doing improvements like flooring, paint, kitchen/bath remodels, additions, etc, could easily improve the value by 10%, 20%, 30% or beyond.  So in this situation 12 months might be long enough.

How about 5 years?  Ok, so you don’t plan on doing any major renovations?  Five years is probably a better target hold time than say 12 months.  This extended period of time would hopefully allow for more than enough appreciation to cover your costs AND let you walk away with a profit as well.

There’s no magic number.  EVERY scenario is going to be DIFFERENT depending on price, property type, location, etc.  There are a lot of variables that come into play and they should all be considered equally.

Don’t make a decision before getting educated!  If you would like to find out more about hold time strategies, or about the first time home buyer process in general, go to our Calendar/Reservations page and register for one of our free First Time Home Buyer workshops.

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