Is Now a Good Time to Sell a House
Yes, you could consider selling your house now, but it depends on your personal situation and local market conditions. The 2025 housing market reports increasing inventory, stable prices, and homes selling a bit slower. This implies sellers still have some power, but it is more important than ever to price your home right. A few essential factors include the length of time you’ve owned your home, your tax situation, and whether you have to sell rapidly.
Asking homeowners, “Is now a good time to sell a house?" The answer should consider your schedule, your financial situation, and your purpose for selling.
Current Housing Market Conditions
The U.S. housing market in 2025 is moving toward balance after years of extreme seller advantage. Here is what the data shows:
Housing inventory rose over 16% compared to last year
Median home prices remain near record highs, though growth has slowed
Homes are spending more days on the market
Nearly 4 in 10 listings have seen price reductions
According to the National Association of Realtors, the nation had approximately a 4.6-month supply of housing inventory as of mid-2025. A balanced market typically has 4 to 6 months of supply.
Sellers can still get good prices, but multiple-offer situations are less common. Homes priced accurately sell well. Overpriced homes sit longer.
How Long to Live in a House Before Selling
One of the most important questions homeowners ask is: how long to live in a house before selling? The answer involves both financial and tax considerations.
The 2-Year Rule for Tax Benefits
The Internal Revenue Service (IRS) offers a special exception where it won’t tax the first $250,000 of your profit as a capital gain (or $500,000 if you are a married couple filing jointly). A few criteria must be met for this exemption, though, and they include:
Ownership test: Have owned the house for at least 2 years within the 5 years before selling it.
Use test: Have lived in the house as your main home for at least 2 years within the 5 years.
These two years do not need to be consecutive. You simply need 24 months of ownership and residence within the 5-year window.
Financial Considerations
Beyond taxes, selling too soon can hurt you financially. Most of your early mortgage payments go toward interest, not equity. Closing costs run 2-5% of the sale price. Agent commissions add another 5-6%.
Most experts recommend staying in a home for at least 3 to 5 years to build enough equity to cover transaction costs.
Can You Sell a House After 1 Year?
Yes, you can sell a house after 1 year, but understand the financial implications.
If you sell after one year:
You will not qualify for the capital gains exclusion
Any profit will be taxed as long-term capital gains (0-20% based on income)
If you sell before one year, profit is taxed at ordinary income rates (up to 37%)
Exceptions That May Help
The IRS allows partial exclusions if you must sell early due to:
Job relocation more than 50 miles from your home
Health reasons requiring you to move
Unforeseen circumstances like divorce or natural disasters
Military service transfers
Can I Sell My House After 3 Years?
Yes, selling after 3 years puts you in a stronger position. At this point:
You meet the IRS 2-year ownership and use requirements
You can exclude up to $250,000 (or $500,000 for couples) from capital gains
You have had more time to build equity
Home values may have appreciated
Three years generally provides enough time to offset transaction costs while capturing home value growth.
Selling Timeline Comparison
Capital Gains Exclusion
Tax Rate on Profit
Less than 1 year
None
Ordinary income (up to 37%)
1-2 years
None (unless exception)
Long-term (0-20%)
2-3 years
Up to $250K/$500K
None on excluded amount
3+ years
Up to $250K/$500K
None on excluded amount
Pros and Cons of Selling Now vs. Waiting
Selling Now
Waiting to Sell
Home prices remain near historic highs
More time to build equity
Inventory is still relatively low
May qualify for tax exclusion
Serious buyers are active
Could see further appreciation
Lock in current value
Better prepared financially
Challenges of Selling Now
Challenges of Waiting
May owe capital gains if selling early
Market conditions could shift
Less negotiating power than 2021-2022
Ongoing maintenance costs
Homes are taking longer to sell
Interest rates may change
When Selling Fast Makes Sense
Sometimes waiting is not an option. Homeowners often need to sell quickly due to:
Job relocation or transfer
Divorce or separation
Inherited property
Financial hardship or foreclosure risk
Property needing expensive repairs
If you want to sell your house fast in Nebraska, getting in touch with a cash home buyer might be your best bet to close in a matter of days rather than months. Cash buyers, basically, buy homes as-is, which is to say that you don't have to do any repairs, staging, or worry about agent commissions.
Key Factors to Consider Before Selling
You should first consider a few things before you make up your mind to sell your home.
Local Market: Don’t rely only on national trends. Look into your particular area.
Equity Position: Determine the size of your equity by subtracting the mortgage balance from the estimated value of your home.
Next Move: If you are purchasing another home, look at how current mortgage rates affect your buying power.
Tax Situation: Have you owned and lived in the house long enough for the capital gains exclusion?
Tips for Selling in Today’s Market
If you decide now is the right time:
Price it right from the start. Overpriced homes sit and often sell for less.
Make strategic improvements. Fresh paint, clean carpets, and minor repairs help.
Be flexible with showings. More access means more potential buyers.
Consider all options. Traditional listings and cash home buyers each have benefits.
Frequently Asked Questions
How long should I live in my house before selling?
You need to reside in the property for at least 2 years to be eligible for the capital gains exclusion. However, living 3 to 5 years is the best way to gain equity and be able to cover the costs of selling the house.
Will I lose money if I sell 1 year after purchase?
That could happen. When you consider seller’s costs such as closing, realtor fees, and potentially taxes, most of the time you will be selling at a loss if the home is only 1 year old, of course, unless your home value has soared significantly.
What if I have to sell, but have only been living there for less than 2 years?
You still can sell. Investigate if you are eligible for a partial exclusion because of work, health, or other unforeseen circumstances.
The Bottom Line
Is now a good time to sell a house? For a large number of homeowners, the answer is yes. The prices are still at a high level, and the desire of buyers to purchase keeps on going. Still, the most important factor is your individual situation.
If you have owned your home for at least 2 years and have gained a considerable amount of equity, it is reasonable to sell your house now. If you are in a hurry or haven’t reached the 2-year mark, take a good look at the tax consequences before making a decision.
Those in Nebraska who own homes but need to sell them fast can benefit from Launch Homebuyers as an option that is simple and offers fair cash prices as well as the possibility to choose the closing time.
However, no matter what you decide, the timing should be right for your life, not just for the market.
