Buy or Sell First
The classic dilemma for many homeowners is whether to buy or sell first. There is no “right” answer. It really does depend on your specific circumstances but there are several aspects that can keep the stress more manageable.
First - Know the market
Listing your home -You can do your own research on-line but a local agent knows your neighborhood and the overall market conditions, so meet with your real estate agent early in the planning stage. Without this professional guidance, you run the risk of pricing your home incorrectly resulting in it not selling or getting less that what it is worth.
Buying your new home - Most people spend an average of 8 weeks actively searching for a new home. With so many choices it is important to have an idea of what you want and need before you begin looking. Consider making a checklist of amenities that are essential and those you would like to have in your new home. The list below may help you clarify your thinking on what is important to you when you are ready to purchase.
What neighborhood(s) would you like to live in?
What price range do you have in mind?
What type of home interests you? (One-story, two-story, split-entry, townhouse, condo, duplex)
Are schools a factor? Do you need to be close to public transportation?
How many bedrooms and bathrooms do you need? How many do you want?
What other interior and exterior features are important to you?
Second – Understand the financial requirements/implications
Listing your home – If you have a mortgage on your current home, speak with your lender to determine your pay-off amount. Will you have enough funds from the sales proceeds to purchase your new home? This information will also help you determine the minimum offer you will accept for your home.
Buying your new home – If you need to finance your new home, begin the loan qualification process early. If you are selling and buying simultaneously, there is the chance the closings will not coincide so have your lender review whether you can carry two mortgages for a short period of time. Other options to consider are bridge loans, rent back options and contract contingencies. Again, your lender and your real estate agent will help you navigate the process.
Third - Have Contingency Plans
Sometimes the most well thought out plans experience bumps along the way. To ease the stress, make a list of what could possibly go wrong and then think of the possible solutions. Factors to consider if the transactions do not occur simultaneously: temporary housing options, where to store belongings during the transition period and if you have pets, where are they going to be during this time.
Deciding to buy and sell your home is a big step so do your research, have a plan and work with a real estate professional. You will be happy you did!