If I had to sell a brand-new house shortly after buying it, would I probably lose money? If I would lose money how much could I lose? 10K? 50K? The house is in Houston TX and was bought for 217,000.
2007-10-27 12:17:34 · 5 answers · asked by drglizard 3 in Business & Finance ➔ Renting & Real Estate
Traditionally you would lose some money if you had to sell in a couple of years. However the real estate market of the past few years has been anything but traditional. Two years ago it would be nearly impossible to lose money but today it might not be possible to break even with the price paid 7 years ago in parts of the country.
Houston seems to have held up a bit better than some parts of the country; you'd have to get comps from a real estate agent to see where you sit.
One of the problems with buying a new house arises if the developer still has unsold inventory. They usually have enough wiggle room that they can drop prices in order to clear it. In the worst cases, they can drop the prices by thousands of dollars and still not lose any money. That has the effect of clobbering the values of the homes sold previously since a buyer can have a brand new home for a lot less than you can afford to sell yours for.
If you use the traditional long-term average of 3% appreciation per year, you'd have to wait 2 years just to pay the sales commissions and another one or two to pay the remaining closing costs. Consult with a local real estate pro for numbers in your area.
2007-10-27 12:31:24 · answer #1 · answered by Bostonian In MO 7 · 2⤊ 0⤋
Depends on what is happening in the market. Currently there is a downtrend where I live which means if I bought here, I could lose money by not being to sell for what I bought for. And then there are the closing costs which eat up a bundle of bucks at both ends, both buying ans selling. At 2 years, even in the best of times, a house will not usually appreciate enough to cover closing costs. Remember, if you itemize on your taxes, you can write off capital losses as well as capital gains on your taxes.
2007-10-27 12:32:43 · answer #2 · answered by rowlfe 7 · 0⤊ 0⤋
Depends on the market. Right now...Yes you would lose money.
2007-10-28 06:15:49 · answer #3 · answered by One Bad Mama Jama 4 · 0⤊ 0⤋
you could lose money i would suggest you not sell your home after only 2 yrs...here are some great home selling information, it may not be for your area but has tons of information
http://www.danagardner.com/
http://www.danagardner.com/PageManager/Default.aspx/PageID=2043116
2007-10-27 14:34:21 · answer #4 · answered by Pure Genius 3 · 0⤊ 0⤋
....or you just barely break even.
This is the one time where a FSBO is probably the best option.
2007-10-27 13:10:02 · answer #5 · answered by Expert8675309 7 · 0⤊ 0⤋