Should You Buy Before You Sell?
SHOULD YOU BUY BEFORE YOU SELL?
Today's market can be tough on repeat or move-up buyers.Not to include the presence of our current COVID pandemic! Some would think it's easy to align the closing of both properties successfully, but the bottom line is there's no guarantee that your new home will close at the same time as your old one. Let's briefly take a look at the scenarios; Sell 1st, then Buy vs Buy 1st, then Sell.
Buying 1st, Selling 2nd
This can be a pretty costly method, but it may be the best for you.
Alright, so you've gotten your pre-approval and low and behold you stumble across your new dream home. So you put in an offer to purchase contingent upon the sale of your current house. Well the seller doesn't think it's a strong offer, who knows when your house is going to sell and how many ready able and willing buyers will he pass by waiting for you? Now this is your dream how so your not going to let this one pass, you increase your offer and he accepts. The pressure is on!! When you go to list your property you'll be so motivated to get to the new home you'll probably list below fair market value. You need the cash quick fast and in a hurry! Sometimes when your pressured by time you do things out of character. So in essence, you've paid too much and for too less. Try to negotiate with the seller a reasonable time frame to close on your old home, and list your home for sale once you submit the offer. It may seem a little premature to list once you've submitted the offer but if your offer is accepted you can use the fact that the selling process has already began as leverage, and you can even have your Realtor support the offer with fast selling stats of your sub. If the offer isn't accepted you can keep your current home listed, the worst that can happen from leaving it active would be getting it SOLD.
If you really don't want it listed until you've found another home you can have your Realtor withdraw it from the market. If you have cash on hand, you could either pay both mortgages until you sell comfortably or even lease the home for cash flow.However, being a landlord comes with it's own set of responsibilities and you may have to repair the home after it's served as a rental.
Selling 1st, Buying 2nd
This can be a hassle, but has gained popularity as a less expensive method and may work best for you.
Obtain your pre-approval, and list your home. Once the contracts start coming in, start looking.You can avoid costly hotel and storage fees by not dragging your feet, when the offers start coming in remember you only need one. When you've found a buyer, make the contract contingent upon you finding a home. You can ask for a few weeks occupancy after closing, but its more common to ask for a few weeks before closing to find another home. Asking for occupancy can become quite costly.
Once you've found the dream home your Realtor can go beat up that seller on the price because guess who isn't contingent?! That would be you my friend! You are a ready, willing and able buyer. Now you've sold for market value, and negotiated a good deal on the dream. If you do end up needing occupancy after closing, try to negotiate a feasible rate that you can actually afford. Agreeing to something you know you can't uphold will only make things worst in the future.
Try to schedule the closing of the new home before closing on the old. There is no right answer for these options. Consult your Realtor for advise on what options are most beneficial according to the local market, and use your financial stability as a guide for the best route for you.
Thanks for Reading,
Malaka Green
For All Things Real Estate - Click Here
Email Me For A Free Market Analysis Of Your Home
Today's market can be tough on repeat or move-up buyers.Not to include the presence of our current COVID pandemic! Some would think it's easy to align the closing of both properties successfully, but the bottom line is there's no guarantee that your new home will close at the same time as your old one. Let's briefly take a look at the scenarios; Sell 1st, then Buy vs Buy 1st, then Sell.
Buying 1st, Selling 2nd
This can be a pretty costly method, but it may be the best for you.
Alright, so you've gotten your pre-approval and low and behold you stumble across your new dream home. So you put in an offer to purchase contingent upon the sale of your current house. Well the seller doesn't think it's a strong offer, who knows when your house is going to sell and how many ready able and willing buyers will he pass by waiting for you? Now this is your dream how so your not going to let this one pass, you increase your offer and he accepts. The pressure is on!! When you go to list your property you'll be so motivated to get to the new home you'll probably list below fair market value. You need the cash quick fast and in a hurry! Sometimes when your pressured by time you do things out of character. So in essence, you've paid too much and for too less. Try to negotiate with the seller a reasonable time frame to close on your old home, and list your home for sale once you submit the offer. It may seem a little premature to list once you've submitted the offer but if your offer is accepted you can use the fact that the selling process has already began as leverage, and you can even have your Realtor support the offer with fast selling stats of your sub. If the offer isn't accepted you can keep your current home listed, the worst that can happen from leaving it active would be getting it SOLD.
If you really don't want it listed until you've found another home you can have your Realtor withdraw it from the market. If you have cash on hand, you could either pay both mortgages until you sell comfortably or even lease the home for cash flow.However, being a landlord comes with it's own set of responsibilities and you may have to repair the home after it's served as a rental.
Selling 1st, Buying 2nd
This can be a hassle, but has gained popularity as a less expensive method and may work best for you.
Obtain your pre-approval, and list your home. Once the contracts start coming in, start looking.You can avoid costly hotel and storage fees by not dragging your feet, when the offers start coming in remember you only need one. When you've found a buyer, make the contract contingent upon you finding a home. You can ask for a few weeks occupancy after closing, but its more common to ask for a few weeks before closing to find another home. Asking for occupancy can become quite costly.
Once you've found the dream home your Realtor can go beat up that seller on the price because guess who isn't contingent?! That would be you my friend! You are a ready, willing and able buyer. Now you've sold for market value, and negotiated a good deal on the dream. If you do end up needing occupancy after closing, try to negotiate a feasible rate that you can actually afford. Agreeing to something you know you can't uphold will only make things worst in the future.
Try to schedule the closing of the new home before closing on the old. There is no right answer for these options. Consult your Realtor for advise on what options are most beneficial according to the local market, and use your financial stability as a guide for the best route for you.
Thanks for Reading,
For All Things Real Estate - Click Here
Email Me For A Free Market Analysis Of Your Home
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