What do i do first?
BUY OR SELL?
If you’re considering buying a new property while you still own your current one, you may find yourself asking, what should I do first? List or Buy? A VERY common dilemma people are having now a-days with the market as wild as it’s been. There are MANY different factors that lead to the path you choose when buying a new home and selling your old one. There truly is no easy answer, as every persons situation is different. Your final decision should be made with research, and help from from your friendly neighbourhood real estate agent 😉 . I hope this article gives you some insight on how many different routes there are available to take, and helps make your transition easier.
Financial situation: Your financial situation plays a large part in your options when looking to sell and buy homes. If you have enough financial resources you may be able to buy before you sell your current home. Where as others may prefer the opposite as it is common to depend on the sale of your previous house in order to purchase your new one.
Market conditions: In this seller’s market, where homes are selling quickly and inventory is extremely low, it may be more challenging to find a suitable new home. In this case, it may be better to sell the current home first and then look for a new one.
Timing: If the person needs to move quickly, then listing their home first may be their only option. In this case, if it’s a fast sell, it will leave the seller with the financial freedom to start the hunt for a new home. However, if it doesn’t sell in the set timeline, it could leave the seller in a predicament where they may have to find temporary housing (rent), or purchase their new house before the sale of their old one. Leaving the seller with two mortgage payments.
Emotional attachment: If the person is emotionally attached to their current home, then it may be hard to leave. In this case, looking for your new home first, may be you best option, as the excitement of moving may make the transition from you current home to your new one, a lot easier.
Selling Your Current Property First
PROS:
- Knowing how much money you will have available to purchase your next property.
- Avoids the risk of having two mortgages at the same time, if you sell your current before you buy.
- Being in a stronger negotiation position, as you’re not depending on the sale of your current home, to purchase your new one.
CONS:
- The possibility of having to find temporary housing if your property closes before you find a suitable home.
- The risk of potentially not finding the perfect home before you sell your current one.
- The cost of two mortgages if you’re unable to sell your home before moving into your new one.
Buying Your New Property First
PROS:
- The convenience of not having to move twice, or find an in-between home.
- The ability to take the time to look for your dream property.
- The possibility of negotiating a better deal as a cash buyer, if you’re in said position.
CONS:
- The risk of carrying two mortgages if your current home does not sell as quickly as anticipated.
- The possibility of being in a weaker negotiation position if you’re dependant on your current homes sale, to complete the purchase of your new one.
- The added stress of having to sell your current home quickly, if you’re unable to afford two mortgages for an extended period of time.
Ultimately, the decision of whether to buy or sell first comes down to a few different factors. Some personal, and some to do with time and place. Thats why its highly recommended to contact your local realtor or banker to weigh out the pros and cons of each situation, and which option may be right for you.