Now is the time to sell your home, where you can make a huge profit.

There are plenty of reasons why you might decide to sell your home. Maybe you’re aiming to move to a cheaper part of the country. Or maybe you want to move to an area where there are more jobs available in your field.

The reason home prices are rising so much these days is because of a lack of inventory. The median existing home sale price in November was $387,600, according to the National Association of Realtors. This is a 4% increase compared to November 2022 and marks the fifth consecutive month that house prices have risen year-on-year.

But while you may want to sell your home today to take advantage of its higher market value, you may face the problem of being locked into an expensive mortgage loan if you sell today.

The Mortgage Interest Rate Conundrum

Many homeowners who own real estate today are facing low mortgage rates because they initially signed on for a competitive rate or refinanced their home loan in 2020 or 2021, when mortgage lenders were offering the most attractive rates in years. there is.

If your mortgage has a low interest rate, you may not want to give it up. However, if you sell your home now and have to take out a loan for a new home, you may end up with unsatisfactory mortgage rates.

That’s why you may feel conflicted about selling your home. It’s a good idea to sell when there isn’t a lot of competition and home prices are rising. However, any profit you make from a higher sale price may be lost by taking out a more expensive mortgage. However, there may be a way to resolve such a situation.

Can you buy your next home with cash?

The biggest downside to selling a home today is having to sign an expensive mortgage on a replacement home, so the solution is to buy your next home for cash. Isn’t it easy?

Of course not!

For many people, this is not an option. This is especially impossible if you are scaling up or moving into a more expensive market.

But let’s say you’re downsizing or moving to an area with a lower cost of living. Perhaps you could sell your current home for $600,000, make a profit of $300,000, and buy your next home for $300,000.

This may require you to make some sacrifices, such as buying a smaller home or a less updated home. But if you can, you can get the best of both worlds: increasing the selling price of your existing home without having to incur a higher mortgage interest rate.

Obviously, this strategy doesn’t work for everyone. However, if you think you have a good chance of buying your next home mortgage-free, you may want to pay to list your home in the near future.

You never know when house prices will fall. And while I don’t expect it to plummet overnight, I don’t want to pass up the opportunity to make a big profit if I intend to sell. Therefore, it may be a good idea to put your plan to sell for a higher price and buy a new home into action before the market changes and home values ​​decline.