We Considered Selling Our Home. Here Are 3 Financial Reasons Why We're Going to Wait

My husband and I became first-time home buyers a little over four years ago -- and what an adventure it has been. While we love many things about our current home, we've outgrown the cozy space. We discussed selling our home and planned to rent for at least a year while determining our must-haves for the next house we intend to purchase. But we've since decided to hold off and continue living in our home. I'll explain a few reasons why we're going to wait.

1. Rental costs are expensive

It's no secret that rental prices have been rising throughout the country. While we can afford to spend significantly more on housing than what we pay right now, we didn't like the idea of having to pay an outrageous price for a home rental. Since we're used to living in a single-family home, we hoped to rent an entire home instead of an apartment.

We spent many weeks looking at rentals in our area to get a feel for prices. Finding a great house at a reasonable price was a struggle, even in our low-cost-of-living city. It didn't help that we were looking for a single-family, cat-friendly rental home in highly-desirable parts of our city.

After visiting homes and seeing what was available, we decided to hold off on selling our place. We didn't want to go through the stress of preparing our home for sale, only to move into a more expensive home that didn't meet our wants or needs. Sometimes it pays to wait.

2. We're locked into a low interest rate

When we bought our home in 2019, we secured a good interest rate on a mortgage. Since we have a 30-year fixed-rate mortgage, the rate will stay the same throughout the lifetime of the loan. But if we were to sell our home and buy another one, we would need to take out a new mortgage. Now that mortgage interest rates have risen significantly, a new loan would cost us much more.

According to Freddie Mac, the U.S. average rate for a 30-year fixed-rate mortgage for the week of July 13, 2023, is 6.96%. No, thank you! A higher interest rate can make your monthly mortgage payment much more expensive, making prioritizing other personal finance goals harder. Looking at current mortgage rates made us realize that it's better to stay put for now.

3. We can afford to save and put extra money toward our loan

Another reason we decided to wait to sell our home was because we're in a comfortable financial position right now. We have an affordable mortgage payment, which provides more opportunities for us to prioritize other financial goals. That includes making extra payments toward the principal of our home loan to save on interest fees and stashing extra cash in a high-yield savings account to save for a future down payment on a new home. It feels good to have the means to do this.

Staying in our current home and continuing to pay an affordable price for housing allows us to live a life we enjoy while working on our financial goals. If we had decided to sell and move into a rental that cost double what our mortgage payment is now, we wouldn't be able to reach our goals as quickly as we'd like. Ultimately, this was a big decision for us to make, but I feel confident it was the right choice for us at this moment.

Consider how your finances might change before you sell

If you're a homeowner who has been thinking about putting your home on the market, make sure you consider all the pros and cons. After selling your home, walking away with a big check would likely feel rewarding. But selling your home could significantly impact your finances.

If you sell your home, you'll need to find another home to move into. That could mean having to pay for a costly rental or taking out a new mortgage with a more expensive interest rate. As with anything in life, it pays to consider how your choices will impact your finances. A big decision like buying or selling a home is one that requires careful thought.