This has been on my mind since March when we got our first unsolicited offer for our house.
5.5 years ago we moved into a rundown bungalow in a desirable neighbourhood. Over the years I’ve been doing 1-2 big renovations each year. The house as it stands now is in our ideal state as a 1,350 sq. ft. 4 bedroom bungalow.
With that said, the Toronto market has been insane and I almost feel like an idiot not selling, or at least entertaining the idea of selling. We owe ~300k on the home and we received 2 offers at $1.5M for the home with 40% down, and just last week another offer for $1.7M. The house isn’t on the market, we have no intention in selling, it’s from people approaching me as I’ve been in the front yard.
If we sell and a “crash” comes, awesome, can rent for the time being and then buy back in and be mortgage free.
If we sell and a “crash” doesn’t happen, I’ve just priced myself out of the market and will not be able to live in the same neighbourhood I’ve wanted to live in. I’d be forced to move.
On one hand, where we live now we are walking distance to everything, family, friends, grocery stores, library, public transportation, major highways, we both have short commutes, etc.
It would seem absolutely idiotic not to sell from a dollars and cents perspective, I get that, but the issue remains we have nowhere to go and in my ideal life I’d want to continue living in this same neighbourhood…which means I am already living my "ideal" life. Wife and I both feel the same way, which makes it such a hard decision.
My last option, where I feel I can leverage the increase in the price of the home is to open up a home equity line of credit. The bank’s appraisal of the home is ~1.3M and with the remaining mortgage that leaves me with a significant access to cash. If the real estate market tanks, I can utilize the HELOC money to jump on other opportunities and buy more property/whatever, if the market stays as is, then I’ve retained the value in the home and I didn’t have to sell/move and look for a new place. This seems like the most logical thing to do in terms of financial risk and lifestyle risk, having my cake and somewhat eating it too.
Thoughts?