Answer: I get this question a lot and, really, the answer is….it depends. The bottom line is that you need to be clear about what you are trying to accomplish and keep your eye on the goal. It is critical to focus on the whole picture. If your goal is to downsize, it might make sense to wait a few years to benefit from higher dollar percentage increases on the more expensive home (i.e. a 10% increase in value on your $1 million home will result in a gain of $100,000, while the same 10% increase on your subsequent $500,000 purchase will cost you $50,000, totaling a net gain of $50,000).
However, the tax burden on the more expensive home coupled with higher utility bills and maintenance costs can narrow the gain to almost nothing over a two to three year period. Of course, if your goal is to upsize, now may be the perfect time in light of projected price and interest rate increases. I love meeting with people to analyze their best strategy.