It can be said that this is the chicken and egg question of the real estate world. If you already own a home and are planning to move to a new one then you will get stuck on the same question. Should you buy a house first and then sell your house or should you sell your house first and then buy one? Ideally, you would be buying and selling them at the same time, but that might be harder than it sounds. It can take months to buy or sell a home which puts people in a predicament.
There is no single answer to the question which will be right for everyone; the right answer depends totally on the market and your own personal situation. Below are a few things to consider before you decide if you should sell or buy first.
Is Durham Region In A Buyer’s Or Seller’s Market?
When many houses are available for sale but buyers are few, the market is referred to as a buyer’s market, because buyers have leverage. When few houses are available and many buyers are trying to buy them, it is called a seller’s market for the same reason. Most would consider that Durham Region’s real estate market as currently being a buyer’s market. Right now Home Buyers will have more options to look at when buying than they did in the hot 2017 market. With more inventory of houses for sale, sellers have to make sure their home is in showroom condition and priced competitively to encourage buyers pick their home to buy. In this case it might make sense for Home Sellers to get their home listed and ready to sell before they buy their next home.
Bridge loans can be a great way to avoid having to pay off two mortgages. This is the main fear people have when considering whether to buy or sell first. Nobody wants to be making two mortgage payments if they don’t sell first. The issue is very common which is why banks offer bridge loans; basically, they agree to allow you to carry two mortgages for a short period of time, this filling in the “gap” between buying and selling of your home. It might be a good idea to talk to your lender before you make a decision to buy or sell first.
If you decide to sell first, it might be a good idea to have some temporary living arrangements prepared. Buying a house in a rush and under stress is something we would never recommend. If you already have a plan in case you need to move but haven’t bought a house, you will not be under the stress. This will really help take the emotion of buying a house.
Conditional Sale On The Purchase Of Your New Home
If you are looking at buying before you sell, you may want to consider a conditional offer. Have your Realtor insert a condition of the sale of your home first before your purchase becomes firm. Essentially, this will allow you to put this house on hold while you sell your house. Be sure to talk to your Realtor about this option first to make sure your totally understand how this options works.
Knowing Your Budget
One of the biggest advantages of selling your home first is that you will know exactly how much you can afford to spend on your next home. So if budget is a big concern of yours, selling first might be the best option. No one has a crystal ball so counting on a certain selling price of your home before it’s actually sold could prove to be a big mistake.
At the end of the day, what you really need to do is talk to a Realtor. Explain your situation with them early on in the decision making process. Your Realtor will be able to provide you with some information on the current market and allow you to make a safe and informed decision on whether to buy or sell your home first.