Should You Buy or Rent After Selling
If you’re a resident of sunny San Diego and you’ve been contemplating whether to sell your current home and enter the real estate market anew, you’re not alone. The year 2023 is already halfway through, and the real estate landscape in San Diego has been evolving. In this video, we’ll break down the important factors you need to consider before making this decision.
#1 Budgeting: One of the foremost factors to think about is your budget. In San Diego, rents have been on a steady rise, especially in studios and one-bedroom apartments. However, this trend seems to flatten out as you move up to larger units. This plateau is partially due to rent control regulations like the 5% cap plus the CPI (Consumer Price Index) adjustments. Despite this, renting in San Diego remains expensive. On the flip side, mortgage rates have seen significant fluctuations in the past two years. Rates that used to be in the fours have now climbed to the high sixes, resulting in a substantial increase in monthly mortgage payments. For many, this 35% bump in mortgage costs might not be feasible at the moment.
#2 Home Equity: Consider your home equity. Many San Diego homeowners have seen their home values increase significantly since they made their initial purchase. This equity could potentially allow you to pay off your new home in full, eliminating the need for a mortgage. Alternatively, you could use this equity to relocate out of state without downsizing. For older homeowners, tapping into a reverse mortgage may be an option to maintain your lifestyle without financial stress. It’s worth exploring if this suits your situation.
#3 Aging in Place: If you’re in the category of aging in place, owning your home can make the process easier. You can make necessary modifications or improvements to your home, which might not be possible in a rental property. Owning your home provides a sense of stability and the knowledge that you can pass this asset onto your heirs. Conclusion: Each of these plans requires careful consideration and, most importantly, a solid understanding of your financial situation. To make an informed decision, it’s crucial to reach out to a trusted professional who can run the numbers for you. San Diego’s real estate market is dynamic, and what may have been the right choice a few years ago might not be the best option in 2023. Weigh your options, assess your finances, and make the choice that aligns with your goals and lifestyle.
Conclusion: Each of these plans requires careful consideration and, most importantly, a solid understanding of your financial situation. To make an informed decision, it’s crucial to reach out to a trusted professional who can run the numbers for you. San Diego’s real estate market is dynamic, and what may have been the right choice a few years ago might not be the best option in 2023. Weigh your options, assess your finances, and make the choice that aligns with your goals and lifestyle.