Allegedly the average American family moves quite frequently for various reasons. I’ve seen numbers suggesting that five moves between ages 25 and 65 is fairly normal, or a little more than once a decade. Renters might move more often, but most people are homeowners so a lot of that number must reflect home sales.
What I don’t hear as much about it the transactional costs of moving, especially if you’re a homeowner. Agent fees (5-6 percent in most of the country), but also transfer taxes(just under 3 percent where I live), paying for two homes if you buy before your old house sells or your lease expires, moving costs, mortgage origination fees, needing to make repairs earlier than you otherwise would, etc.
It seems like the cost of selling one house and moving to another, assuming similar prices, can be as much as 10 percent or even more of the home value. For every transaction. But it’s very easy to just ignore this loss because it isn’t made very explicit by the process.
I’ve never heard anyone tell me not to move because the transaction fees will destroy my wealth. I know many people who make multiple moves within a single metro area. Yet moving once a decade could cost a middle class family several hundred thousand dollars over a lifetime.
Is this something you’ve thought about and what are your thoughts?
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