In today's media the news is all about how horrible the real estate market is. Well the news has a point, however, they only show the doom and gloom. I have never been one to look at things as only negative. I try to see all the positives in everything, that includes today's real estate market. So, how do you take today's news and find the bright lining? By thinking outside of just your home and it's value. If you bought your home for $250,000 a few years ago and have subscribed to the notion you can not sell it because you will lose money, would you consider selling it if you could make $50,000.00? Try thinking this way:
A few years ago you bought a home for $250,000.00
Today you can sell your home for $225,000.00
By doing simple math you can see that you would be $25,000.00 behind where you were, BUT, and this is where the conventional thinking needs to end folks, by doing this you can actually make money. Here is the rest of the equation to make you money:
You sell your home for $225, 000.00
You buy a home for $325,000.00 (that a few years ago sold for $400,000.00)
In essence, you discounted your home $25,000.00 but you bought something discounted $75,000.00
So you are actually making out $50,000.00 better (the difference between your discount and the greater discount you got).
It is like trading up. Or taking a short term hit on stocks or finances to realize a greater gain down the road. Not many people are thinking this is the way to approach real estate and those that are, are really making out.
Now this does not work for people who are under water with their homes. That means anyone who bought their home, refinanced it shortly after and took out any equity. Or anyone that took out a line of credit against their homes. Remember homes are not savings accounts they are a long term investment in our future.
