Life and plans change — and you decide to sell your home and find another one. This is the time to think about which buying and selling option would work best for you.
Sell first, buy later. This is a great option if you want to take your time finding a new home. Selling first gives you a clear idea of how much home you can afford. It increases your leverage by eliminating the contingency to sell your house before you close on another. Most important, selling first takes the urgency out of your search, allowing the time you need to find that “just-right” home. Selling first means you must find a temporary place to live while you look for a new home.
There’s more to think about than just the money you’d acquire from a sale, though. Be aware that the inventory may be low in the community that you want to live.
Options for temporary housing include:
- Renting a house or townhome for the short-term
- Renting an apartment month-to-month
- Moving in with generous family or friends during the interim
- Booking an “extended stay” hotel or inn, which tend to have a usable kitchen area
Sell and buy at the same time. This is a pretty common scenario, especially for homeowners who don’t have a “backup plan” — like the option to move in with family or friends for a few weeks or months. Homeowners sell one house and make an offer on another ̶ with the goal of having both transactions close on the same day.
It can be a challenge to stage your for-sale home and keep it clean for showings, all while touring other homes, making offers and negotiating coinciding closings. It can feel like a crazy dance, but your experienced REALTOR® will guide you through the closing process on both transactions without missing a step. Your Edina agent knows how to smooth your transition from one home to another.
Timing, price, location and inventory can all affect your
Buy first, sell later. This is an attractive option for buyers who can afford to make two mortgage payments for a short time. It allows you to buy, update or remodel a new home while still living in your current one. You put your current house on the market only after you are living in your new home. Be sure to check with your banker to ensure pre-approval of your mortgage without selling your current home.
If you want to buy first, but avoid two mortgage payments, you can try to add a buyer’s home sale contingency in the purchase agreement of your new home. This contingency states that the transaction for the new house is dependent on the sale of your current property. A seller may perceive a contingent offer as weaker than a non-contingent offer. In a sellers’ market, you may have a more difficult time getting the seller to accept a contingent deal.
Timing, price, location and inventory can all affect your home search. Your REALTOR® is a valuable resource as you evaluate the costs, benefits and other variables to find the option that best fits your needs and timeline.