Kyle takes a few minutes to explain how to make the best decision in multiple scenarios. For more info, read below.
Lately many people have been asking us the following question:
Should I make sure my current home is sold before I go out and buy a new one?
The answer is not so simple, it depends. The purpose of this article is to make you aware of the pros and cons of both sides of the coin and to help you make the correct decision for your situation.
The most important factor to consider is what type of house you are trying to sell. It goes without saying that an entry level property, such as a townhome or semi-detached, will be much easier (and typically quicker) to sell than a sprawling country estate. Unfortunately, not every situation is so black and white. There are other types of properties, styles of finishes or upgrades that may take a little longer to sell, or achieve better results at certain times of the year.
The second thing you need to evaluate is the current market condition. As of right now, 2016 has shown us that it is indeed a seller’s market. In markets such as this, it’s typically a good idea to find your next home before you think of selling. Selling should be relatively easy with the right marketing plan and pricing strategy in place.
Many people also think they can save money by either buying or selling first. The simple truth is, there is typically no clear advantage with one or the other. Someone who tries to sell their home first is likely to get more money for their home by taking their time and doing it properly. Conversely, someone who tries to buy first may be able to be more patient and possibly get a better deal on the new property. They may also suffer afterwards trying to rush to get their home sold to match up closing dates.
Whatever way you choose to do it, remember that even if the closing dates don’t perfectly match up (or are sometimes even months apart!) that there are services offered to help ease the transition. Bridge financing is a popular way to be able to carry two properties for a short amount of time. The bank will loan you money to close a new property pending your current sale for a cost of roughly $25-50/day as well as a potential set-up fee (that they should waive if you complain enough). However, it may not be available in every situation, so it is best to contact your mortgage professional with any questions you may have regarding a bridge loan.
Ideally, it is better to take the necessary time you need to find your dream home. Why rush when you really don’t have to? Buying first can alleviate a lot of stress, and ensure that you make an educated real estate decision. If you must sell first, give yourself as much time as possible. Instead of closing in 30-60 days, close in 90-120+ days. This will allow you enough time to find yourself a home without having to panic.
Whatever decision you choose, keep in mind that the entire process is best facilitated with the help of a qualified Realtor. We have seen these scenarios countless times and know the best strategies to take to match closing dates. Working with us will ensure that your situation is as simple and stress-free as it can be!