2 Ways to Break Even on Your Home Before 2022
NEW YORK ( BankingMyWay) -- News on the housing front is getting better, but it's still far from great.
An Aug. 23
New York Times
Ten years is a long wait, but homeowners can employ some techniques to hasten a breakeven date -- a useful strategy if you will someday need to move for a new job or growing family.
Of course, not everyone bought at the 2006 peak. If you bought earlier, or later, you might enjoy real gains well before 2022. And although homeowners are understandably disappointed if their homes are not worth what they were six years ago, those peak prices were a freak, resulting from the housing bubble. In other words, it was unrealistic to count on prices continuing to rise from that high point, or even to stay there.Anyone who buys a home now, or has in the last eight or 10 years, should think hard about when the breakeven point will come. That's when the proceeds from a sale would be enough to cover the original purchase price plus the various expenses of buying and selling, like transfer taxes, loan application fees and realtor's commission. These costs can come to 10% or more of the original purchase price. In fact, many homeowners will reluctantly settle for less, hoping to sell for enough to cover their remaining mortgage debt and those other costs, even if that means losing some or all of the down payment made when the home was purchased. Two techniques can help speed the breakeven date. The first is "sweat equity," or raising the home's value by working on it yourself. Improvements generally increase a home's sales price. Unfortunately, improvements done by professionals typically don't add as much value as they cost, according to the
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