Many homeowners look back on 2006 house values and wonder why they didn’t sell at the height of the market. They lament the money they may have lost by not selling. However, there is another side to that story. If they did sell back in 2006, they would have still needed to live somewhere.
Looking back at the euphoria that permeated the real estate market at the time, many may have sold and moved into an even nicer, more expensive home. With the benefit of 20/20 hindsight, we can now calculate the financial consequences of such a move.
Let’s look at a house that would have cost $400,000 in 2006. For the sake of this example, we are going to assume that values in this region dropped 25% since. To compute total cost (principal and interest payment) we needed to research mortgage interest rates at the time also.
Here is the comparison:
You saved over $1,100/month on your mortgage payment. Maybe it wasn’t horrible that you didn’t sell in 2006. Perhaps, it was a great decision!