Upsize or Downsize: What’s Your Best Move?

June 6, 2024 by Debbie Spencer

Deciding if it is time for your family to upsize or downsize is not always a clear choice. There are factors to consider that might push you to take the leap or stay put for a while longer. Whether you are thinking about upsizing so your family can spread out or purging possessions so you can downsize, here are some questions to ponder.

1. How are you using your current space?
Do your family members feel like they don’t have adequate privacy or space to do their own thing? Are you tired of working at the dining table and really need an office or workshop? Is having the kids share bedrooms just not working out? Maybe an upsize is warranted. On the other hand, do you have rooms that aren’t being used, or are you tired of paying property taxes on more house than you need? Check for the downsize column!

2. Have you considered the maintenance costs?
If upsizing is on your mind, consider the added costs for maintaining a larger home and property, whether in money or time. Will you be able to keep up with cleaning, lawn care, and general maintenance issues that come with owning a home? If you are ready to cross maintenance off your to-do list, perhaps you are ready to downsize to a more manageable property or one where the HOA handles part of the job.

3. What are your outdoor space needs?
Are you ready to give up having a yard or garden to downsize to a maintenance-free space? Do you have pets that need outdoor space? Do you need more outdoor space for your children to play or your dog to run around in? The size of the house is one thing, but the property is important also.

4. Have you looked to the future?
What do you expect your needs to be in the next five, ten, or twenty years? Do you want a large home where your children and grandchildren will come for vacations and holidays, or will you be spending those times at their homes? Will you want to entertain groups of friends, or do you foresee going out for your entertainment? What will happen if your spouse passes; will you want to stay in the home on your own?

5. Do the financial implications add up in your favor?
Can you handle the higher costs involved with a larger home, or are you ready to cut costs with a downsize? Consider where you stand on your current mortgage. Are you alright with starting a new mortgage at this point in your life, or are you in a position to purchase in cash? What are the tax implications for your move?

6. Is it the right market to upsize or downsize?
A seller’s market is hot for those looking to sell a larger home and downsize. Upsizing may be riskier in a big seller’s market, but if your family would be happier in a larger home, it might be worth the leap.
Whatever questions you have about purchasing your next home, I’d be honored to assist you. So let’s work together to make sure your next move is the right one.

DEBBIE SPENCER GROUP

REALTOR®, CRS, SRES

m: 617-285-7300
t: 781-860-7300
e: debbie@thedebbiespencergroup.com

1 Militia Drive, Suite 204, Lexington, MA 02421

www.thedebbiespencergroup.com

8 Reasons Why Real Estate is the Best Investment

May 6, 2024 by Debbie Spencer

Real estate has long been considered a solid investment for many reasons. It is a relatively safe and easy way for people to build wealth beginning with a small amount of money. If you are interested in investing in real estate, I’d be happy to help you find the right properties.
Here are some of the ways investing in property can help you build an investment portfolio.

1. Real estate investments can provide you with a reliable and steady cash flow. Investing in rental properties is relatively easy as expenses are predictable and if your properties remain occupied you know what to expect in terms of profit margin.
2. Real estate appreciates in value. Real estate consistently appreciates, even during economic downturns, making it one of the more reliable investments. On average, real estate in the US appreciates between 3-5% annually.
3. Real estate investments help you retire. If you have been paying on your mortgage throughout your working years, you will experience greater cash flow as you near the end of your mortgage term and the principal is paid off.
4. Real estate sales are taxed at a lower rate than other income. When you sell your property, you are taxed short- or long-term capital gains which are usually lower than income tax brackets.
5. Real estate equity can be leveraged. One of the most attractive reasons for investing in real estate is the ability to leverage your money. When you take out a mortgage to purchase property you reduce the amount of capital required. As you build up equity in the property, you borrow against the equity or refinance the original loan, freeing up cash to buy another property.
6. You have control to improve upon your asset. Unlike an investment in stock, where you have no control over how it performs, you can improve upon your real estate investment. Updating or upgrading systems, finishes, appliances, and landscaping helps build value in your investment.
7. Real estate gains taxes can be deferred. Under the 1031 exchange tax code, you can invest the gains from the sale in one property to the purchase of another property without paying taxes on the gains.
8. Real estate investments are depreciable. This is confusing, but you can legally claim a depreciation expense on an investment property even though the value of your investment property is actually appreciating. The depreciation deduction allows investors to generate a higher cash flow while reporting a lower income for tax purposes.

DEBBIE SPENCER GROUP

REALTOR®, CRS, SRES

m: 617-285-7300
t: 781-860-7300
e: debbie@thedebbiespencergroup.com

1 Militia Drive, Suite 204, Lexington, MA 02421

www.thedebbiespencergroup.com

Should You Buy and Sell at the Same Time?

March 6, 2023 by Debbie Spencer

Both buying and selling a home are equally stressful, but what about when you are trying to coordinate both at the same time? There are a lot of moving parts, and the agents involved work together to insure the smoothest possible transactions for our clients. If you are selling your home and want to close on a new home purchase at the same time, here are some things to think about to make your move as smooth as possible.

Truly simultaneous closings are rare these days, especially when financing is involved. Regulations put in place to protect consumers have made simultaneous, or double, closings very difficult to pull off. Concurrent closings occur when a party is selling and buying properties at about the same time, usually within a couple of days of each other. If you wish to close on the sale of your home and the purchase of a new home back-to-back, the best scenario is to work with the same title company and escrow company for both transactions. Usually the sale of your home is closed first, your mortgage is paid off, then the purchase of your new home is closed.

Selling your home ahead of buying is the most risk-free alternative, as neither transaction is contingent on the other. However, this requires your family to make an extra move and have a place to live while you wait to close on a new home, so in terms of convenience and expense, it’s not always the best scenario. If you have the ability to secure a short-term rental, or to put your belongings in storage and stay with family, then you can enjoy the luxury of taking your time to look for and close on your new home. One option that sometimes works out is to rent your home back from your buyers while you wait to close on your purchase. This works well when the buyers are not in a hurry to move in themselves and you can agree on a timeframe for you to remain in the home.

Buying ahead of selling is a dream in terms of convenience. You can take your time moving, and maybe do some renovations or decorating before you move in. But will you qualify for a new mortgage without a contingency on selling your existing home? If you can swing the mortgage, or are paying cash, it may be a great option for you. Remember to realistically consider how long you can afford to maintain two properties– with maintenance costs– in case it should take you longer than expected to find a buyer for your present home. In this scenario, you may want to rent your new purchase back to the sellers, or list it as a short-term rental, while you wait to close on the sale of your existing home.

Consider your buyers and sellers carefully when trying to coordinate a sale and purchase within a short amount of time. The last thing you need is a seller or buyer who is displaying signs of being uncommitted to the deal. While no deal is guaranteed until all the closing documents have been signed, when you need a purchase or sale to coincide with your schedule, you should carefully evaluate who you sign a contract with. A contract with contingencies on other deals going through, a lender expressing doubt about final financing approval, a low good faith deposit, buyers asking for unreasonable repairs or allowances, or sellers whose moving plans are questionable are red flags that your deal could fall apart.

DEBBIE SPENCER GROUP

REALTOR®, CRS, SRES

m: 617-285-7300
t: 781-860-7300
e: debbie@thedebbiespencergroup.com

1 Militia Drive, Suite 204, Lexington, MA 02421

www.thedebbiespencergroup.com

7 Tips for Saying Goodbye to Sentimental Belongings

February 6, 2023 by Debbie Spencer

When I work with clients who are downsizing to a smaller home, one of the hardest chores they face is letting go of sentimental belongings they no longer have room for. Souvenirs collected during travels, family heirlooms, and your children’s keepsakes can be quite stressful to part with. It doesn’t matter whether the items have monetary value or not; in fact, often the most difficult items to let go of are worthless in terms of money, but priceless in sentimental value.

Here are some tips to help you part with belongings you are attached to but no longer want to keep.

1. Remember that our memories reside within us, not within our possessions.
Psychologists say that letting go of sentimental items can be extremely therapeutic. When we keep things, the items occupy both physical and mental space in our lives. It’s healthier to focus on your memories and not the items that represent your memories.

2. Focus on the present. Letting go also helps to bring your focus to the present. Sometimes things are continual reminders of the past and hold us back from living in the present. Dwelling in the past can make one more prone to depression and can affect our ability to deal with stressful situations in our lives. Realize that while we can always cherish our memories, we don’t need the past to be happy in the present.

3. Let go of guilt. People often hold onto an item they don’t want or need because someone special gave it to them or it represents a special person. Learn to let go of the guilt associated with getting rid of gifts you can’t use. Appreciate the thoughtfulness of the giver or the special memory it represents but pass the item on to someone else who can use it or donate it to charity.

4. Don’t save it for your grown children. Times have changed and today more young adults are able to buy their own furnishings. And they aren’t as sentimental about family heirlooms as prior generations were. Talk to your kids now and find out if you are holding onto your china, crystal, and silver tea service for nothing.

5. Compromise with your spouse. It’s not uncommon for one spouse to resent the others’ favorite belongings while holding onto their own special stuff. It’s important to recognize that, while you may not understand your husband’s need to keep a ball cap for every MLB team he’s seen play, he may feel the same way about his hats that you do about keeping every book you have read. Decide together on a reasonable number to keep.

6. Start with the easy stuff. If you have a lot of belongings to sort through, start with the easier decisions and work from there. Often people find that once they get some momentum going it feels good to let go.

7. Write a family memoir. Hold onto your memories with words instead of things by writing your memoir or the story of your family. Writing your story can be very therapeutic and can help you release your hold on tangible items. If you need help, try a service like Storyworth.com.

DEBBIE SPENCER GROUP

REALTOR®, CRS, SRES

m: 617-285-7300
t: 781-860-7300
e: debbie@thedebbiespencergroup.com

1 Militia Drive, Suite 204, Lexington, MA 02421