Buy My House...

It's a nice house, in a good neighborhood, with great neighbors. We have, however, been thinking for a while about selling it. In fact, we had planned on it.

Now, like so many homeowners in Charlotte, the recession has left us with a stagnant market and difficult choices. Beginning today, we'll help you navigate those issues by telling you the story of one house. My house.

(First, a disclaimer: No house will actually be offered in the making of this feature. I don't want to take advantage of this blog's public presence, so no picture of my house, no listing of features, no asking price *cough*whatabargain*cough*. Seriously, no deal making here.)

But today, a question: Should we even bother trying to sell?

Our story: We purchased our home in the University area in late 2004. Our mortgage was a five-year adjustable rate, and we made our payments and saved our pennies with the notion that before the mortgage adjusted, we would sell and move to a location closer to work and church.

Today, we are less than a year from that adjustment, facing a market in which good houses are sitting unsold for long stretches of time. We are fortunate in that we can afford to stay - our house has equity and value, and our mortgage payment won't rise too steeply when it adjusts. Do we test that market, anyway, to see if a buyer happens to fall in love?

Area Realtors, who tend to be chronically optimistic, think now is a fine time to explore a sale and purchase, especially if you plan to move to a neighborhood with higher home values. Charlotte's Allen Tate Real Estate calls it the Buy/Sell Equation. "This is a market where you're going to take less on the sale, and make it up on the buy," says president Pat Riley.

Makes sense. If you settle for 10 percent off your $300,000 home, then get a $400,000 home for the same 10 percent off, you'll net $10,000 in the process.

Still, the market that awaits us is not encouraging. While there are fewer homes to compete with - about 26,000 active listings in our region today, about a thousand less than a year ago - the average price has dipped from $218,000 in January 2008 to $189,000 in January 2009, says Donna Anderson, president of the Charlotte Regional Realtors Association. And, of course, housing sales are significantly down.

The snag, for those with adjusting mortgage rates, is that you have to sell your home now. Homesellers in this difficult environment often face an unpleasant surprise when they de-list their homes and apply for refinancing. In most cases, you're not going to get a new mortgage.
Lenders presume that if you recently tried to sell your house, you might try to sell it again soon, paying off your newly refinanced loan and costing them profit.

"It's expensive for bankers to put a loan on the books," says Bill McConnell, a mortgage broker with Charlotte's Cunningham Mortgage. "They all want a chance to make a return on their investment."

McConnell says that lenders typically want houses off the market for three months before they'll approve a refinancing. Some want more than three.

And so, the options: Refinance the house now, with closing costs (even if they are rolled into the new mortgage). Or roll the dice and offer the house in an area where a few houses are selling, but not many. It's a choice facing homeowners through Charlotte - and the country.

Says McConnell: "I don't know if there is any good advice here. You have to go with your gut."

We're mulling.

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Are you facing a similar decision? Tell us about your house and the choices you've made.

And remember, we're taking entries in our Bad Financial Writing contest. Think you can write some terrible prose about how bad it is out there? Have a bit of fun in these difficult times and send us an awful paragraph. Winner gets recognition - and a Charlotte Observer coffee mug.