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How to Take Advantage of the Real Estate Market

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The current real estate market is booming. According to recent reports, home sales have skyrocketed due to low inventory and high consumer demand. If you have a property in a great area, odds are you can sell it for a fantastic price.

But there’s more to taking advantage of the current real estate market than simply listing your home with the help of a real estate agent. Let’s break down how you can best take advantage of the current market conditions before they fade away in favor of a buyer’s market.

Downsize Your Home

Given current high house prices, now is the best time in the last several decades to downsize.

Downsizing your home means deliberately selling your current property, purchasing a smaller and cheaper house, and pocketing the extra cash to put toward your retirement fund or for other purposes. Downsizing your home is wise now because, even if you were to sell for a profit, odds are you’d have to pay more than you expect for a house of the same size as your current property.

Therefore, it’s a good time to downsize your home. Let an agent take it to list on MLS to gauge interest from prospective buyers. If enough people seem interested in your property on the MLS listings, set it for a competitive price and watch the offers come in.

With a little bit of luck, you’ll be able to make a massive profit on your current house, then buy something truly special with a little less square footage. It’s a good idea if you are looking to sell your home in a rural area and move into the city or if you are trying to downsize to prepare for retirement in your golden years.

Try a Home Equity Loan

If you don’t want to sell your house, you can always try a home equity loan. A home equity loan allows you to borrow against the equity you’ve already built up in your home, as its name suggests. Since the housing market has improved greatly, and since home equity levels are higher than ever, now is the best time to borrow against your own property to make big renovations, purchase a second house, or even fund your child’s college education.

These days, you can apply for a larger line of credit than you could normally otherwise. Take advantage of this limited opportunity now and be sure to lock into a loan with a fixed interest rate to avoid regretting it in the future!

Consider a Cash-Out Refinance

Alternatively, you should consider a cash-out refinance. This allows you to see a monetary benefit without selling your property since your home is currently worth more than it was a few years ago.

As opposed to a traditional refinance, a cash-out refinance lets you borrow more than what you have remaining on your mortgage balance. Any excess cash you get from the deal can be used for whatever purpose you want, like paying off debts or upgrading your house.

Refinance rates are very low, in stark contrast to average mortgage rates. So take advantage of this very rare opportunity now before the housing market corrects itself and interest rates go back down.

Scoop Up a Smaller Property to Renovate

If you have some cash lying around, you could buy a property rather than sell it. Many projections indicate that house prices will continue to increase for the foreseeable future, and at least for the next year.

Therefore, you could put some extra cash to work by scooping up a smaller property to renovate and rent out. This could be a great way to set yourself up for success and comfort in your golden years. With just a single rental property, you could earn passive income to supplement your current retirement strategy, whether that’s a 401(k) or an IRA.

Sell Now, Float for a Bit, Then Buy a New Home

Lastly, you may wish to take advantage of the real estate market by selling your property now and floating for a bit by living in a hotel or with friends and family members.

Why do this? Many project that the housing market will decline over the next few years. If you sell in the near future and make a big profit, you can wait until house prices drop and potentially snag a fantastic property with that nest egg. This is a bit riskier than the other methods, but it could be well worth it if you want to buy cheap.

As you can see, there are many ways in which you can take advantage of the current real estate market for the better. If you have a property you want to tell, or you just want to get a better deal with your current home, you can do that using the strategies above. Good luck!

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