Author Topic: Would you sell your home for a loss?  (Read 3509 times)

Dmy0013

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Would you sell your home for a loss?
« on: June 14, 2016, 11:08:45 AM »
My wife and I have been living in a apartment style condo for the last 5 years - We purchased the condo for 267,000 and a 5,000 tax rebate was also given back to the builder so I have always valued the condo at 272,000.  We love the condo, we love the area, we are the top floor corner unit, all of our windows / deck look out onto small heritage parks. The Parks are protected land and can not be developed on.

My wife and I are expecting our first child in less then 4 weeks now, and we have ran out of space.  although it is managable to live here with a baby, we are ready to just move and purchase a traditional style home.

I have some friends down the street who bought a house at the same time I bought my condo - they just sold their house making about 130,000 profit - they did put about 30,000 into finishing the basement, but none the less there house value has gone up significantly.

My condo on the other hand has not gone up at all.  Today I looked on KIJIJI (not sure if you have that in the US? Same idea as Craigslist) and I saw 8 units for sale (131 units on grounds) the bulk of the units were asking what they paid and some were even asking 10 - 15,000 less then they paid.

As far as competing with the other units I have the second most expensive unit in the complex with the most expensive suite style (4 different layouts in building)

I have some concerns that when I try to sell, I will be the most expensive unit in the complex however I also have the nicest with the best views so that might work it self out.

I guess my question is do I sell and take a loss if need be?  This would allow my wife and I to purchase a home, the losses from the condo would probably be offset by the appreciation of my home in the first few years... Now I understand there is no guarantee my home value rises.

I have run the numbers of using the condo as a rental, I would have a negative of about 300-400 a month.  So its not a good rental

Do I suck it up and stay put?

The thing that concerns me about staying put is there is another condo project that is starting in fall, and it will contain another 130 units 2 blocks from my building.  Similar building style, similar suite styles.
Im not a real estate expert but I assume a new condo project 2 blocks from me is only going to hurt the value of my suite.

Thanks in advance

 

HappyHoya

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Re: Would you sell your home for a loss?
« Reply #1 on: June 14, 2016, 11:36:39 AM »
You have to decide what the quality of life factors are worth to you. If there is a new condo project going up, and based on what you are describing about your situation, it doesn't sound like you have any reason to believe the value will go up in the future. If you're going to sell at a loss now verses later (of course we can't know the future), but I would do it when you wanted to move for other factors, since the future value is always unknown.

frugaliknowit

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Re: Would you sell your home for a loss?
« Reply #2 on: June 14, 2016, 11:52:51 AM »
It depends on your priorities.  If your priority is to own and live in a single family home and if your financials are "good to go", then go ahead and do it.  Whether your condo has gone up in value is mostly irrelevant.

I would NOT do it on the basis of projected future value for two reasons:  1.  We don't know what the future holds as far as values and 2.  All other things being equal, the cost of a home is based on square footage.  The bigger the home, the bigger the overall costs, regardless of whether it goes up in value.

merula

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Re: Would you sell your home for a loss?
« Reply #3 on: June 14, 2016, 11:57:05 AM »
I'm in a similar situation, currently trying to sell a condo I bought in 2007. I will be lucky to get $20,000 less than I paid, and I put $15,000 into it over the last 9 years.

BUT, I ran the numbers comparing where I'd be if I rented a similar apartment during that time, and actually, I'm pretty close to break even if you don't count the time value of money. (I realize that that's a really important exception, but I can't say for sure what I would have done with the money I put into my house. I can easily see my past self jumping into the stock market and jumping right back out in 2008-2010.)

What you paid for anything is irrevelant to its current value. A given item is "worth" what someone is willing to pay for it. This condo has given you a place to live for 5 years, why does it need to be a runaway investment too?

And if you were to look at a differnt 5 year span or a different location, the condo might have been the choice that showed a $130k increase in value. Don't compare yourself negatively to your friends for not making the "right" choice in hindsight.

rockeTree

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Re: Would you sell your home for a loss?
« Reply #4 on: June 14, 2016, 06:15:59 PM »
I wouldn't move so close to having a baby. In four weeks you will not want to be showing your place, looking for a new place, packing your stuff, or setting up a new house. Have your kid and chill for a year- you won't need any more space til it's on the move toddling at the soonest.


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SwordGuy

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Re: Would you sell your home for a loss?
« Reply #5 on: June 14, 2016, 06:48:04 PM »
I hear this all the time and it's usually just drivel.

You are going to have your first infant and therefore you are out of space in your home?

Are you giving birth to a baby elephant or a baby human?   Because I have to tell you that from personal observation a baby human doesn't take up very much space for quite a few years.


seattlecyclone

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Re: Would you sell your home for a loss?
« Reply #6 on: June 15, 2016, 11:39:40 AM »
Agreed that you don't necessarily need to move just because you're having a baby.

That said, if you do want to move, don't let the anchoring effect irrationally force your hand. The condo is worth what it is worth. Don't let the amount you paid for it even enter into the decision. If you want to move, move. Sell the condo for fair market value.

FLBiker

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Re: Would you sell your home for a loss?
« Reply #7 on: June 15, 2016, 11:50:57 AM »
I wouldn't move so close to having a baby. In four weeks you will not want to be showing your place, looking for a new place, packing your stuff, or setting up a new house. Have your kid and chill for a year- you won't need any more space til it's on the move toddling at the soonest.


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Totally agreed.  Our DD is 14 months, and we still barely use her nursery.  We all sleep better when she's in our room.  Her room is basically just for changing and naps.

Dicey

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Re: Would you sell your home for a loss?
« Reply #8 on: June 15, 2016, 11:58:34 AM »
You're talking, but all I can hear is "I want, I want, I want". Interesting that you didn't post your square footage. I think you have a case of complainypants. Put on your parentpants and focus on decluttering so there's plenty of room for your tiny new baby. Reconsider in three years or so. Selling now is like selling stocks when the market is down. Why take an imaginary (paper) loss and make it a rreal one? No need to slaughter your green soldiers just yet, sir. Carry on. Your life will be crazy enough in a few weeks and between now and then, you've got a lot of cleaning out to do. There's even a name for it. It's called "nesting". Hop to it. And best of luck to your newly expanding family.

Dmy0013

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Re: Would you sell your home for a loss?
« Reply #9 on: June 16, 2016, 08:33:44 PM »
hahahahahahah thanks Diane I needed a good laugh!

My condo is just over 800 Sq feet (apartment style no yard / no garage / no storage), we have been on the verge of wanting to move for a few years now, yes we are kinda using the baby as an excuse I guess.  None the less its been a serious idea we have been bouncing around for about 2 years.

If we were to purchase a house in the near future, we most likely would purchase a lot first then build on it shortly, after I imagine it would be close to a year until we moved - there is a new development where we live, we would most likely look at the different phases and what phases will have parks / water in them and pick a lot based off that. It would be atleast a year if not longer I'm sure.

My only concern is a starter home runs you about 450,000... a lot of money with the wife on mat leave for a year!

Thanks for your comments

meerkat

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Re: Would you sell your home for a loss?
« Reply #10 on: June 17, 2016, 05:43:32 AM »
You're going to have other things to worry about for the next few months so try putting the idea of moving on the shelf mentally for six months or so. Even if you could buy a house tomorrow, the one you choose might not be the same as the house you'd choose six months from now. For example, someone else mentioned that they barely use their daughter's nursery - we have our son sleep in his room all the time but oh man I wish it was at the other end of the house instead of adjacent to our room. Also the main play area ended up not being in the room I thought it was going to be, which may or may not changes as he gets more mobile.

czr

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Re: Would you sell your home for a loss?
« Reply #11 on: June 17, 2016, 07:04:07 AM »
Kids under 5 do not need much space nor do they complain about it. I have an infant in a arm's reach bassinet and that has worked well for the other two. Try to remember your earliest memory as a kid and the lack of space will not come to mind. Just utilize the space you have. You may even want to hire a organization specialist if you really want to make bigger changes.

Re-evaluate in a year. GL with the new baby!

VaCPA

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Re: Would you sell your home for a loss?
« Reply #12 on: June 17, 2016, 07:06:17 AM »
Two thoughts I'll add :

1. You shouldn't hold a property just because you'll only break even or lose money. There's no guarantee it goes up if you stay, and even if it does wouldn't the house you want to buy go up as well? You noted some concerns with other developments coming online. You just have to decide if you can afford to sell it and move, and then decide if you want to. If you do then don't hesitate just because you feel like you aren't getting enough out of it.

2. You can definitely have an infant in a condo. They spend all their time in someones arms or in a bassinet/crib. Or lying on the ground. You shouldn't feel pressure to move just because of that. If you want to cool but don't do it because you think you won't have space. It probably won't become a little challenging until the child is walking/running. Having a toddler in a condo isn't ideal(especially for your neighbors)

pbkmaine

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Re: Would you sell your home for a loss?
« Reply #13 on: June 17, 2016, 07:14:03 AM »
As a first step, why not declutter, pare down and simplify, which you will want to do anyway if you decide to move? You may find you gain enough space to make the move unnecessary.

soccerluvof4

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Re: Would you sell your home for a loss?
« Reply #14 on: June 17, 2016, 02:41:40 PM »
I agree that the baby is not going to make the difference in the space. Why not put on the market for what you need and if it sells it sells. Doesnt cost you anything and if its one of the 2 best in the building it will sell. It only takes one buyer. If you dont try you wont know and you will continue to ask the question.  But yea....not buying the baby thing at least for they can walk and then some.