Interesting question and yes you did seem to buy at the right time just before the market really started to turn around in the Austin area.
While you could refinance and pull out the equity in the home (you will need to have lived in the home a full year to be able to do that but it looks like you are there now if you purchased last summer) it probably makes sense to downsize and sell if that is truly your objective. If you can sell and make a profit to use towards your business objectives that is probably better than keeping a home that doesn't suit your needs long term.
Buying something today you plan to keep for the long term will allow you to still take advantage of the current low interest rate environment. Sure rates are a point higher than they were a few short months ago but they are going to continue to rise over the next year and into the future. Where they ultimately go is anybodies guess but historically that is the 6% range. As rates increase it may decrease the benefit of downsizing. I mean if the rate on the new smaller home is considerably higher than the 3.75% you have now it makes the smaller home more expensive due to the higher cost of borrowed money.
If you sell now you could essentially keep the 5% necessary for your next purchase aside and the rest could go towards your business goals. It seems like a win win for you and also eliminates the uncertainty of what rates will do which could ultimately force you to stay put where you are now.
That is my two cents anyway. As a mortgage broker and Realtor I fully understand all aspects of the process. If you would like to discuss any of your refinance options or discussing the value of your home please do not hesitate to contact me.
Best of luck to you.
Don Groff | REALTORÂ® & Mortgage Broker
Austin Real Estate Pros & 360 Lending Group
o 512.669.5599 | m 512.633.4157 | email@example.com
websites: www.AustinListed.com | www.360LendingGroup.com
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