5 Signs It's Time To Sell Your Home

Selling your home isn’t just a market decision — it’s a life decision. In this episode, Tim breaks down 5 clear signs that it may be time to sell, using real math, future planning, and one simple question: will the version of you five years from now be glad you stayed?

You’ll learn:

• When maintenance costs turn your home into a money pit
• How to calculate the true 10-year cost of staying in your current location
• Why your home’s layout may no longer fit your future needs
• How to measure the years of retirement your home equity could fund
• The “flinch test” that reveals whether a major life change is already telling you to move

Bottom line: the home that served you well in the past may not be the home that serves you best next. Run the numbers, picture your future, and give yourself permission to make the right move.

Intro

Outro

Transcript

SPEAKER_00 0:27

Is now the right time to sell your home? A lot of videos out there are trying to convince you one way or another, but I am not here to do that because I think it's the wrong question. The right question that should be being asked is would the version of you in five years thank you for staying or would they thank you for leaving? I'm betting that deep down though, you probably already know the right answer. This video is about getting that deep down feeling up to the surface. In order to do that, I'm going to give you five tests and I'm going to be up front. Three of them are going to sting a little, but we need to get into this. Sign number five is the maintenance overrun sign. And this is the sort of money pit time vampire hybrid that is slowly turning home ownership into a full-time job that you did not apply for. The water heater goes, then the HVAC, then the roof stares menacingly at you, like threatening you to leak. And somewhere there, you stopped using the word house and started referring to it as a project. If your contractor is now in your favorites and the Home Depot guy nods at you when you walk in, well, this just might be the time to sell. So you need to ask yourself if something breaks tomorrow and the repair bill is approximately $5,000, can I write that check without rearranging the retirement plan or the college savings plan? If the answer is no, the home might be slowly suffocating your wallet. And the worst part here is that low funds lead to deferred maintenance. And consequently, deferred maintenance is the number one reason that buyers lowball you later at sale. Every month that you wait while that deferred maintenance list grows, the sale drops further and further. The relatively small repair that you just can't afford today eventually grows into a really sizable credit that you are forced to give up at closing tomorrow. Living in a home that you can't maintain is just working your butt off to pay for the privilege of watching it lose value in slow motion. That's a big sign. Get out of there. Sign number four is the carrying cost arbitrage, which, as Norm MacDonald would say, is a very fancy word for a very dirty thing. Now to calculate this, you have to pull your annual property tax bills, your insurance bills, your annual utility spends, and your HOA if you have one. Add all of those numbers up and multiply it by 10. That number is the next decade of just owning the home before you fixed a single thing or paid a single mortgage payment. Now go look at three comparable homes in three lower cost states if you're able to move. Not necessarily nicer homes, not bigger homes. Just stay at the same square footage, the same bedroom count, same general vibe of what you've got now. If your 10-year carrying cost number could buy you a comparable home outright somewhere else, well, I mean, you're sitting on top of an arbitrage plate. You're paying a premium to stay at a zip code, like a country club membership that you can't cancel. Some people look at that number and they decide that the zip code is worth it. They love where they are, but maybe it's because your family is here or your doctors are here, the grandkids are just down the street. Fine. But you should at least take a look and pencil out exactly what you're paying for the location you're in. And if you have no attachments to your local area, well, well, then it might make sense because at this point you're downsizing your expenses while maintaining your quality of life. Sign number three is the structural mismatch. And this is the one that it gets kind of uncomfortable to talk about because none of us like to admit that we're getting older, but pretending it isn't happening is more expensive than facing it head-ons. And so here's what I want you to do. Go ahead and stand in your main bathroom, like right now, pause the video and ask yourself three questions. One, can a wheelchair turn around in here? Two, can someone with a walker reach the toilet without navigating a step up or step down? Three, if the master bedroom is upstairs, can a new bedroom be added on the main floor without you know basically rebuilding the whole house? If the answer to any of those questions is no, and the answer five to ten years from now for you might be a yes, you have a structural mismatch. The home was built for the version of you that took the stairs two at a time. The version of you in 2036, well, let's just say you might move at a more relaxed pace. Now, often remodeling a mismatched home is going to cost more than simply buying one that's well suited for you. And you also get to avoid the fun of living in a construction zone for six months. I mean, that dust gets everywhere. I know you probably know this already. The numbers almost never work to remodel. So in this case, it's time to move. Now, if you do decide that it's time to sell, but you're not exactly excited to hand $30,000 of your equity to a real estate agent. I know exactly where you're coming from and I can help you. So just go to the link below, grab a call with me, like a lot of other viewers have, and we can talk about your options. Now, sign number two is when you've reached an age where your home equity isn't going to be used to put toward a down payment on another home anymore. Maybe now we have to look at this as fuel of your retirement. Here's the math on this one. For example, if your home is worth $600,000 and you owe $150,000, well, you have $450,000 to work with. Now, if you're planning to sell without an agent, you can subtract roughly 8% for costs like taxes and actually moving your stuff. You're left with around $414,000 in real usable cash. Now, divide that amount by your personal cost of living for one year, which is your actual annual spending on things like groceries, utilities, gas, insurance, and I don't know, even the cable bill that you keep meaning to cancel. Let's say that that comes out to $50,000 a year. Well, $414 divided by $50 is roughly eight. That's eight years of living expenses that are just sitting in your drywall. Now, while eight years certainly buys you time, that's not really at a place where I would make any big changes. Now, on the other hand, if that number comes back at 10, 15, 20 years, well, now we're talking. I mean, 10 years of life paid for by the house stacked on top of your social security, your 401k, whatever else you've got going in the mix. Well, now you're at the point where you can approach a retirement decision. And here's why this gets missed a lot of times. Financial advice treats homes as if they were untouchable. You're supposed to keep it, you're supposed to pay it off, you're supposed to leave it free and clear for the kids. Selling for some folks feels like giving up, but the house doesn't care about your feelings. Mathematically, for a lot of people in this audience, the home isn't an asset working for you. It's more like a vault that's holding a lot of cash hostage. The unlock moment is when you realize that that vault has a key and now might be the best time to turn it, which brings us to sign number one. And this is the major change. These can be really happy things or really sad things. On the happy side of the ledger, maybe there's a new baby coming or there's an insanely cool job opportunity in a completely different state. Sometimes on the sad side of the aisle, maybe it's a death in the family or a job loss, maybe an illness that makes proximity to a specific hospital just non-negotiable. And sometimes just recognizing that tomorrow is never guaranteed, but maybe it's the fact that your grandkids are four states away and you want to be able to take them fishing every weekend. I don't know. The point here is that these are not impulsive reasons, but they do matter and they shouldn't be put off. If you're wondering if this applies to you, simply close your eyes and picture yourself in this exact home in five years, the same rooms, the same layout, same yard maintenance, same commute to work, whatever. If that picture makes sense, you're probably okay. But if you flinched a little when you imagine that, that is your brain telling you something is off. This is something that shouldn't be put off. You need to make this decision now. Often what keeps people stuck in decision mode is they're looking for somebody to tell them, hey, you're doing the right thing. So if you've gone through these steps and one or more of these signs applies to you, here's your permission. It's okay to sell. The home that served you for the last several years isn't always the home that's going to serve you for the next several years. And pretending otherwise is just very expensive nostalgia. But maybe you've made it to the end of this video and you're leaning actually toward the other direction. Maybe one or two signs hit home, but the rest just didn't. And you're starting to think that the smarter move is staying put. Look, if that's you, I made this video right here and it lays out every reason to stay in the math and quality of life based rationale behind each one. You're going to know by the end which path makes the most sense for you. I look forward to seeing you there.