Selling Your Home Or Buy Your Next Home First?
This is the number one question my partner and I get asked when consulting clients, and one that you should ask yourself before selling your home. I’ll start by saying that there is no perfect answer or best way that works for everyone. Below we will cover the main points to consider when selling your home to buy another property and practical strategies you can use.
Selling Your Home First
The main concern with selling your home first is “What if we can’t find a place to move to in time?”. This is the primary concern for people coordinating a sale and purchase at the same time. The benefits of selling your home first is taking advantage of opportunities (lack of competition), controlling your sale, and knowing exactly what your final sale price and conditions are. The potential downside is that you now have a set time limit on finding your new home.
First, if you have the opportunity to sell a property with no other competition in your neighborhood that is a big advantage. Second you can control your sale by having time on your side to negotiate and firm up on any conditions as offers come in. Thirdly, when you do have a firm deal in place you know exactly what the property has sold for. Any conditions have been taken care of and the closing date set. This means you can confidently shop within your budget given the sale price of your property.
Buying Your Next Property First
For most movers the main concern is being able to actually sell your home once you have purchased your new one. Being on the hook for 2 mortgages can be scary. Thankfully, we are currently in a sellers
market in Waterloo Region and Wellington County. If you price and market your home appropriately the sale should not be a major concern. That being said, if you are able to find and purchase your home before selling your you can ensure that you have purchased for the right price at the right time. Purchasing first can allow for more time to shop and negotiate offers. Furthermore purchasing first provides you with time to prepare your home for market as you shop for your new one.
From a realtor’s perspective our focus is to manage the goals and needs of the client with current market conditions. When selling your first home here are some key points to consider:
- How common is your home and the property you are looking to purchase? The more common, the easier it will be to either purchase or sell in a shorter time frame if need be. If the property you are selling is uncommon, or has a smaller buyer pool than most properties, selling first may be your best option.
- For people selling your first home that NEED to get a certain price to make your move work then selling first is your best option. If 1-2% difference either above or below your listing price is not going to kill your move then consider purchasing first.
- Short term financing is not a bad option. If you are concerned about matching closing dates for your move don’t panic. Bridge financing can allow you flexibility between closing dates. Ask your mortgage broker when consulting them about your moving plans. You may be surprised with your options!
- Prepare yourself either way! If you’re selling first, go view some options as you prepare your property for market. You can shop while it is listed too. For purchasing first, get your home ready to list so when you have locked down your next property it’s good to go. Get your place cleaned, staged, photographed and ready to sell.
There is no perfect solution for every client. Each situation and the desired goals are completely different. To make an informed decision as a buyer and seller you should consider the pros and cons of each option.
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