Putting this question out there to those of you who are hopefully more familiar with this topic than I. Here's the situation:
My work is transferring me to the Washington, DC area this summer with my family (wife, 3 kids age 10 and under). We're likely to be in the area for a max of three years, before transferring again to another location outside of Washington. We currently own a home there (in northern Virginia) and have had it rented out for the past eight years while we lived elsewhere (we converted it to rental once we departed from our last stint in DC in 2014). It's a 3 BR, 2 bathroom townhouse in a nice neighborhood, in good condition, but maybe a bit small for our current family size.
Ideally, we'd like a bigger place to give us more space but the real estate market in the DC area (and maybe all around the country?) just seems bonkers right now. Properties are selling for simply astronomical prices and it's reminding me of the atmosphere that prevailed in the time just before the bubble that burst in 2008: people are buying properties sight-unseen, no inspection, cash-only, bidding wars, etc. Rental prices are also insanely high in the area right now, seeming to follow the general trend. The way I see it, I have 3 options:
1. The double-edged sword option: Sell our current townhouse (which will surely fetch a nice sum) and then buy another larger place (sticker shock guaranteed). Could be cool to upgrade, but we may also be walking into a trap, buying a property for big $$$ then potentially left holding the bag when/if this market cools or this bubble bursts.
2. The half-measure option: sell the townhouse, rent a bigger house. Not a terrible solution in my mind, but it just means we've dumped 100% of the real estate portion of our portfolio and are back to being renters yet again (see also the aforementioned high rental rates).
3. The suck-it-up option: just squeeze back into the current unit for a couple years, then look to sell or rent it out again.
Neither my spouse nor I want to own property long-term in the DC area. Our dream is to eventually buy a large property... anywhere else, but definitely not in vicinity of Washington, as neither of us is originally from there and aren't terribly fond of living there aside from relatively short stints for work.
We'll be needing to make a decision in the coming weeks, so I appreciate any thoughts/advice/insights you guys might have.