Move-Up Buyers

According to the 2010 NAR Profile of Home Buyers and Sellers, the primary reason that repeat buyers purchased was the desire for a larger home or a job-related move. Improved affordability was also an important motivator. Moving up in a down market offer some great opportunities to buy the dream home for half price.

Many homeowners paid cash, have substantial equity, or have the resources to sell their current homes at today’s prices. While the idea of selling for less than peak value is a hurdle for some, other Tampa Bay homeowners are persuaded by the math.

Consider this example: the Smiths purchased their Westchase home for $250,000 in 2006. Now they want to buy a larger home in Odessa. The value of their Westchase has dropped by 25% to 187,500 for a loss of 62,500.

The Smiths first saw their dream home in Odessa a few years ago when it was on the market for $600,000. After the 25% drop, however, the same home is listed in the Tampa MLS for $450,000 today.

The Smiths may worry about selling their home at a loss of $62,500, but they more than make up the loss when they buy. The loss was offset by the savings of $150,000 on the Odessa home. In addition, the Smiths enjoyed the benefits of lower taxes, lower interest rates and lower homeowner insurance.

What are the most effective strategies for reaching move-up buyers? Contact Annette, Dour or Dale Bohannon at Coldwell Banker Residential Estate in Tampa, Florida to discuss a plan.