Sunday, March 22, 2009

On the Market

So, now that the cat's out of the bag that we are leaving Rochester, here's another tidbit: our house has been on the market since mid-February. All of those recent home improvements weren't solely for my benefit, after all.

"But, Alex," you say, "aren't we in the worst housing market in over a generation?"

"Yes, yes we are. And verily it sucketh."

That pretty much sums it up. We purchased our home almost four years ago. Rochester has more turnover than most cities its size, and being in the Midwest missed much of the wild highs and subsequent lows of, say, Las Vegas or Miami. Nevertheless, if one looks over the historical data for home prices in Rochester for, say, the last decade, you'll see that prices today are roughly where they were this time in 2004. Therefore, one could expect that we would be selling for at or a touch below what we paid for it. And, in fact, we are currently listing below what we paid for it. Based on recent sales and current listings in the area, out list price is what the market will bear.

And although we have paid dutifully on the mortgage this whole time, we can't claim to have a whole lot of equity in the house. What equity there is will more or less get wiped out by the agent's commission. Closing costs will start eating into the down payment. So, all in all, we can expect to take a bit of a loss.

Out of this, I have a few consoling thoughts:
1) Despite the loss we will take on the house, it is still significantly less than what we would have paid over the last few years if we had rented. Owning over renting has had plenty of other, non-financial, benefits.
2) The pain we feel is the pain everyone is feeling. The economy at the moment is what it is. The timing of selling our house is what it is. In the end, there isn't anything that we can do about it.
3) Although we are taking a hit as home sellers at the moment, we will certainly benefit from depressed home prices when we buy our next house.

It is tough to not feel a little bitter, however. We've done a lot with this house: refinished hardwood floors, a reshingled roof 2-1/2 years old, a renovated bathroom, new front steps, an efficient new dishwasher and fridge. In the normal course of things, we could have expected a nice appreciation based just on that. So, the cynic would look at the situation and proclaim: "Congratulations, you put thousands of dollars into this house, only to see its value drop by an equal amount - ain't life grand?"

Still, the market is what it is, and no amount of wishing is going to change that. Time could change things, but we haven't really got time to wait the market out. So, rather than gripe about it more, I'm trying to focus on just gettin' it done so that we can move on. Even if we don't like the situation, we may as well accept it.

You'll surely hear more about this as the weeks pass by. Hopefully it won't be too many more weeks...

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