Is now a good time to downsize?

Some may not realize financial benefit they expected
Published on Sep 14, 2009

Interest rates are low. Prices have come down in many areas. More buyers are deciding it's a good time to buy, even though it may be awhile before the housing market stabilizes. Buyers who have a house to sell face a more complicated situation than they did when they bought their first home. They may not be able to afford to buy a new house before selling the old one. And, it may be more difficult to find a home to buy because many sellers are not selling now due to current market conditions. Despite complications, homeowners who want to trade up in a down market can benefit financially. They may sell their current home for less than it might have sold for a few years ago, but they could also pay a lot to less for the replacement home. Let's say your current home that was worth $500,000 two years ago is now worth $400,000, or 20 percent less. Even though you would sell for $100,000 less today, if you buy a $1 million house that two years ago was worth $1.25 million, or 20 ...