If moving is on the horizon for you sometime soon, then you’ve got plenty of decisions to make. And one of these important decisions is whether to sell or buy first.
Should you list your home first and look for a willing buyer before committing to another home? Or should you find something first to make sure you’ve got a place to go if you happen to sell faster than you initially thought?
Many homeowners are usually torn when it comes to making this decision, so the typical solution is to simply buy and list at the same time. The thing is, coordinating closing dates on both the sale of your current property and the move-in date of your new home can be a real challenge.
So, how can you make sure that buying and selling at the same time works out for the best? Consider following these tips.
Determine the Market You’re in
The temperature of the housing market in your area will determine how to proceed with your move. In fact, this is perhaps the most important factor to consider when timing your purchase and sale perfectly. The amount of time it takes to sell versus how much time it will take you to find the right home to buy will need to be considered when timing it correctly.
Is it a buyer’s market? If so, that means there are plenty of sellers out there and lots of inventory for buyers to choose from with fewer buyers to compete with. In this market, finding a home at a good price shouldn’t take long at all, though selling might take a little longer.
Is it a seller’s market? Then that means there are tons of buyers to compete with and not much inventory, which could take you longer to find the right property. But as a seller, you have a better chance of finding a buyer quickly and sealing a deal on your current home in a short time frame.
If you decide to list your current home and look for a new property at the same time, make sure you take the current market into consideration. Your listing strategy and house-hunting tactics should be tweaked accordingly to try and get the timing right.
Get Pre-Approved For a Mortgage
It’s always a good idea for buyers to get pre-approved for a home loan before they start house hunting. This will help them get an idea of how much they can afford in a home purchase. A pre-approval letter will also help get the ball rolling with mortgage approval so the mortgage can close faster after a deal is reached. This is important if you’ve sealed a deal on your current home and need to close faster.
A pre-approval is particularly important if you’re a buyer in a seller’s market, as you’ll be competing with many other buyers for fewer homes. In this case, you’ll want to do whatever you can to bring a purchase deal into fruition without any hiccups, and being pre-approved for a mortgage can help.
Have an Appraisal and Inspection Done on Your Current Home
Getting your home appraised before you list will help you determine the best listing price for your home. Inflated listing prices can end up causing listings to linger on the market for longer than necessary, causing them to go stale. An appraisal will provide you with some great insight into what your home is actually worth according to market conditions and will help you price accordingly.
Having your own home inspection done before buyers first make their way into your home to scope it out will help you identify any issues that may need some attention. Knowing about any potential defects with your home will give you the opportunity to fix them before your property is listed. You can be sure that such defects will be identified in a buyer’s home inspection, so uncovering them before an offer is agreed on can make the sale go much smoother.
Both an appraisal and a pre-listing home inspection can help you get your home ready for the market and price it accordingly, which can both prove to be extremely helpful in ensuring a seamless transaction.
Consider Including a Contingency to Sell Your Home First
If you find yourself in a buyer’s market, buying a new house shouldn’t be an issue. But selling might take a bit longer. In this case, you could find yourself with two mortgages to pay if you can’t sell your home after committing to buying a new one. In this case, you may want to consider including a contingency in your offer on a new home that states that you’ll only buy the home if you’re able to sell your existing property.
Just keep in mind that many sellers might not be too keen on such a contingency and may reject it.
Hire an Experienced Real Estate Agent
Your best bet when trying to time the purchase of a new home and the sale of your current property correctly is to hire a seasoned real estate agent who’s experienced with these situations. Trying to time these two transactions can be a complicated endeavor, so working with an experienced agent can prove to be extremely helpful.
An agent who is well-versed in these situations can help you come up with a sound strategy, negotiate appropriately, and price right to ensure that the timing of both transactions is as seamless as possible.
The Bottom Line
Lining up the closing dates on the sale of your current home and the purchase of a new one can be a real challenge. When you’re ready to make a move, make sure you go into this situation with a sound plan of action and a seasoned real estate agent in your corner.
