When it comes to buying a home, while selling a home and trying to close at the same time, it can be difficult. Doing this is all about timing. Unfortunately when you are trying to do this you can’t control everything, but there are some things you can do to set you up for a smooth closing.
1. Evaluate the local housing market:
Knowing what kind of market you’re in is important whether you’re just moving across town, or if you’re moving across the country. If you’re selling in one market and buying in another, you’ll need to factor that into your timing. The length of time it takes to buy and sell can vary depending on the local real estate scene.
Are you in a buyers market or sellers market?
Buyers market: A buyers market means there are more homes available than there are people looking to buy. You will have an easier time buying a new home than you will selling your current home.
Sellers market: If you are in a sellers market then there are more buyers in the market than there are homes available. In this market your current home will most likely sell quickly.
2. Choose a Great real estate agent:
Buying and selling at the same time can be complicated and at times overwhelming, so it’s helpful to have somebody that knows what they’re doing by your side. A great, experienced local agent will not only be able to help you determine the market value of your home, but they’ll be able to talk you through timing, strategy, and negotiation. One of the most important roles your agent plays is to help you find the perfect listing price. A price that will help you sell on your timeline and for enough money so that you can take that next step.
3. Understanding your financials:
You’ll need to determine what your home’s resale value. It is also important to find out how much equity you have on your current home. Equity is the amount left over when you take the current market value of your home and deduct what’s remaining on your mortgage.
If you want to buy a home before selling your current home here are some ways you can make that happen:
• Make an offer with a sale and contingency
• Request an extended closing
• Purchase with significant savings
• Purchase with a bridge loan
• Rent out your first home
If you decided to purchase a home before selling your current home some advantages are:
• You have somewhere to move right away
• You only have to move once
• You’re less pressured to make quick buying decisions
Now here are the disadvantages:
• You may feel rushed to sell
• Contingent offers are less competitive
• You may not have enough cash to make a competitive off if your money is tied up in your current home
• If you decide to rent your current property, sometimes being a landlord is not easy.
If you decide to sell your home before buying here are some steps you can take:
• Make an offer with a contingency
• Find a temporary rental to live in
• Sign a rent-back
Advantages of selling before buying:
• You’ll know exactly how much equity you’ll have to put towards your new home
• You can easily roll your equity into the new purchase
• It can be less stressful knowing you have already sold your home
Disadvantages of selling before buying:
• You’ll have to find a temporary living situation
• Storage and moving twice can add up
With all this said, buying and selling a home at the same time is not impossible and has been done many time before. Just make sure you have the right agent to help you out with this process.
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About Kierston Kellstrom
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