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7 Reasons to Buy Before Selling your House

9 August 2017,
 0

Confused about buying a new home first or selling the one you have? Many homeowners start to sell their home the minute they decide to buy a new one. This is not surprising because naturally, a seller wants to ensure the property sells before he takes on a new mortgage.

The problem with this scenario is when the property sells before the owner is able to buy a new home. There’s the rush to move somewhere in time for the closing. Since buying a home should never be a rushed decision, a homeowner will definitely feel the pressure.

It is difficult enough to sell a home but buying one at the same time makes it much more complicated.

If you are in this situation, there are ways to make the process much simpler and less stressful.

Whether you are selling and buying a house simultaneously or just one or the other, it makes a lot of sense to work with a good real estate agent. Let’s take a look at how you can make it work for you and come out a winner in your real estate transaction.

buy-new-home-before-selling-your-house

 

Things you need to Think About Before Selling your House

If you are like most people in this situation, your main goals would be:

  1. To sell your current house for the best possible price
  2. To buy a new house for as low a price as possible
  3. To complete both transactions with as little stress as possible

This is a tall order, so you will need a good strategy.

One of the most essential steps to this process is to make your home sale a profitable one. The second step is to transition successfully from your old mortgage to a new one, allowing as much equity from the sale to be converted into cash.

Lastly, to make the transition as smooth as possible, it is advisable to make the process of selling the home and buying a new one simultaneous.

 

7 Benefits of Buying First Before Selling a House

Paying two mortgages for your current home and a new property can seem frightening to many. There are, however, certain advantages in buying a home before selling one.

  1. It can be less worrisome if you know where you will be going before parting with a home you have known for many years. To many people, the unknown is a dangerous place. If you have already purchased a new home, you can simply enjoy what lies ahead and not feel too emotional about leaving an old chapter in your life.
  2. There is tremendous pressure to buy a home when you have already sold yours. If you buy a home first, you can definitely take your time in choosing among available listings. There is less chance of making hasty decisions you could live to regret.
  3. For individuals with good credit standing, a bridge loan can allow for transition between two mortgages. You can get access to money for a down-payment on a new house while waiting for your current one to sell.
  4. One of the most difficult and expensive challenges in selling and buying a house is moving expenses. If you buy a home first, you need to move only once.  You can avoid moving into temporary housing or worse, buy on a spur of the moment.
  5. If you have already bought a home, you can afford to pass up on low-ball offers for the house you are selling.
  6. You can enjoy the home buying process more because you are not under pressure about selling your house first.
  7. It will be easier to sell your house later since the sale will not be affected by whether you have bought a home yet or not. You wouldn’t need time to move out and can immediately close with your buyer.

 

Watch the trend before you strategize

Of course, this kind of strategy may not be ideal for everyone. In the end, your overall strategy will have to depend on your needs, your financial capacity, and your goals.

If you are in a sellers’ market and you have found a dream home you can’t pass up, surely it is worth taking the leap. You can buy your home first before selling your house.

 

Go with the Market: Talk to your Real Estate Agent

In an ideal world, it is best to close on a new property before selling a current home. This method will reduce the inconvenience of transferring your possessions from one home to another.

However, it isn’t always as simple as this. In a seller’s market, it is important to settle on a new home before selling your house.  Limited property listings and fierce bidding wars in hot property markets means long periods of waiting before you can snatch up a property.

 

Slower Markets Means Longer Selling Time

But it is very different in slower markets where there are plenty of homes available for sale and selling a house takes longer.  In cases like this, it would be better to sell a home first.

 

Having an experienced and savvy real estate agent can really make the difference.

Your selling agent can advise you of how long it typically takes to sell a home in your area and how much your home can sell for.  By having good information available to you, you would be in a better position to make sound decisions.

 

Selling a House in a Buyers’ Market

The most pressing reason to buy a home first before selling a house is when you are in a sellers’ market.  You can assume that your house will sell quickly.  It is important, though, to remain business-like in your approach and to view your property in the eyes of buyers.

You must watch the movement of homes in the market to time the sale of your house with your purchase of a home.

 

How to Buy and Sell a Home at the Same Time

The most logical approach to this conundrum is to sell first before you buy.  In doing so, you’ll know how much money you can afford to spend on a new house.

Selling an existing home is less risky because you don’t run the risk of over-extending yourself.  But if you sell first, you may need to rent while looking for an ideal home to buy. Two moves will mean double the work and the expenses, too.

 

The benefits of bridge financing

If you decide to buy first before selling, bridge financing can help you fund the purchase of a new house.

In effect, it enables you to buy a new home and own two at the same time.  They can cover the full financing of a property until the homeowner is able to sell an existing one and can settle all or part of the debt.

It does have a risk. If you are unable to sell your property within the expected time frame, you will be repaying two loans.

 

Found the perfect home to buy but haven’t sold your home?

In real estate, things don’t always work according to plan.  While you are having open houses for your current home and idly looking at new homes to buy, you could suddenly find a perfect house to buy.

You’ll need to consider several other factors before making a decision. If you are financially able to wait it out with your property for sale, you can get a short term loan and then use the equity in your current home.  You can pay off the loan from the sale.

If the home you want is very specific, such as a specific neighborhood, it can reduce much of the anxiety if you find a home before listing his own property.


Take it from the experts – Speak to a qualified real estate broker

Like every important decision we make in life, the best solution will be different for every individual.  It is critical to examine your financial and personal situation and evaluate your options before buying a new home.

But we also know that getting the right advice can help to clarify our options.  We go to a lawyer for legal problems, a doctor for medical advice, and a financial adviser for questions about investments.

In much the same way, it is best to speak to a qualified and experienced real estate broker about the sale and purchase of a property.

 

Find the best real estate agent with free real estate proposals

Real estate professionals understand the real estate market and the ins and outs of buying and selling.

When you hire a real estate agent, you benefit from this expertise and experience in conducting your transaction.

Licensed real estate agents have a responsibility to represent your best interests and will provide you with valuable advice about the price of your home, the right neighborhoods to buy, financing options, and more.

When you compare real estate agents, you can:

  • ✓ Find the right agent to work with quickly
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  • ✓ Connect with real estate agents and brokers that know your neighborhood

Compare real estate agents today to find out how to buy or sell your home in the timeliest and most profitable way.

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