As far as whether you should move, consider all the transactions costs and whether you could an an extension to your existing house for the same or less. Just worth a thought.
The only way that I would suggest a move in this market would be if you were looking to move to your destination home. You are not going to get as much for your home, and depending on how long you have been there you could lose money. However, if you are moving up to another price point then they will be losing more money. Look at it this way. If the whole market has come down 7%, your $300 K home is down $21,000 and the $500K home you want to buy is down $35,000. Your making $14,000 right off the bat, but you to stay in this home long term so you can turn that $14,000 into $48,000 and have a great home to raise your family. Best
The town is in trouble financially. Residents have two major projects which need to be undertaken over the next few years: a complete rebuilding of the Vincent-Owen school with a size increase, and a major overhaul of the high school including a size increase. With the huge financial hit the town took with the Farm and the lack of tax revenue from it, Winchester is in a financial hole.
The NAR is fighting hard to hold back the tide. Interest and mortgages rates are going up and not just a little bit. Currently the Fed, various government agencies (Fannie, Freddie, FHA), etc are purchasing or insuring (via TALF) over 90% of the mortgages originated. Normally this is below 15%. My personal estimates is that if the Fed stops supporting the mortgage market at the end of March, mortgage rates will approach the 7% level by the end of the summer.
What is only being discussed behind closed doors is the problem with the government's debt for 2010. Per Obama's budget that was just submitted, they're looking at $1.7T in new debt. With some of the rosy projections in the budget, this will easily move to $2T. But that's not the big worry.
China spent much of 2009 rolling its long term US Treasuries into short term as did others. In addition to the "$1.7T" in new debt which has to be raised, 40% of the already existing debt needs to be refinanced or "rolled over" this year. That's ~$3T of additional debt refinancing or close to $5T overall.
Last year new debt issuance was about $1.7T of which about $300B went to the traditional international sources. The remaining $1.4T was purchased by the Fed by printing up new dollars and diluting the supply and also in exchange for the MBS's (Mortgage Backed Securities) which the Fed was purchasing. The Fed bought the MBS's from the banks for top dollar and the banks bought Treasuries with the proceeds of the sales, thereby putting them, theoretically, in more financially sound positions and set up to be less exposed to the next leg down in housing which is coming.
You can't fund ~$5T in new deficit spending by just monetizing all this due debt; the dollar will be crushed. A large part of this will have to be raised externally which means higher Treasury rates and therefore higher mortgage rates. Much higher.
As rates go up, property values come down; for mortgage payments to remain constant with a higher interest rate, the house purchased has to cost less. Buy houses when mortgage rates are high and look to start coming down; then sell them when they've been low and look to start going up. If you plan on keeping the home, you then refinance with the rates have come down. (You can never renegotiate your home price; you can always refinance.)
Interest rate changes affect higher priced homes more than lower priced homes. If you're considering moving into a larger home, it might behoove you to wait until the fallout from higher mortgage rates have settled.
I have worked in Winchester in RE for 14 years and live here as well. I don't necessarily think that living 5 houses away from one of the 5 elementary schools is such a positive thing. Buyers will complain that the house is too close and the noise during recess (warmer weather) is too disturbing. Also, depending on which elementary school you live near, parking could be a problem with teachers parking on the street, perhaps in front of your house. That being said, I would say move away from the school. I think the only way to advise you on whether to sell, is to look at your house. How long ago did you buy it? How much have you put into it? These are key factors. The real estate market in Winchester is down but there are still buyers out there. If you are in the Lincoln or Ambrose district, that is still the most desirable place where people are looking and you might sell your house right away, depending on your pricing. Pricing is everything in today's market.
REMAX Leading Edge 748 Main Street Winchester
Since you already live in Winchester I don't need to give you the sales pitch! But if you are considering other communities, I would just caution you to stick with comparable communities. You can upgrade, yet get more for your money if you are not tied to the Boston commute that Winchester offers. Which communities have you considered?
The market in the Western suburb communities is steady, although it is tipping to the buyers market side of things. What this means to a seller moving up is that if you prepare your home for sale and price it correctly, you should be able to to do well upgrading. This is a market for first time buyers, investors and sellers moving up. Down-sizing should stay on hold unless a person is leaving the area entirely.
Hope this helps you - let me know if I can be of any further help.
On the other hand, if you plan to downsize, people normally do it at the market peak when same % up on real estate, bigger home make more money dollar wise.
Ideally, you would buy a bigger home now for some good saving, and rent out your smaller one since the rental market is great.
e.g. back in 90's when market was at the lowest to come back up like now, I move to the bigger home I could afford, yet catch the 3.875% ARM and rent out my condo and use the rent to pay mortgate of the bigger house. This is important concept since if one only own ONE house, when market jump again, you still do not benefit too much since you have to live at your only home. Whereas if you have more than one, when market jump again, you can cash in the other one.