Thursday, December 3, 2020 / by Breanna Thornton
Do I Need to Sell my Current Home Before Buying a New One?
What’s the smartest first step? To buy a new home or sell your current home? This is a great question to ask before starting the moving process. There are a lot of steps that go into making a move, so learning more about your finances and local market is the best way to set yourself up for success. This article reviews some general pros and cons to both options.
Thinking of Selling First?
It makes sense to a lot of people to sell first, since you have that security of being able to move on without having to pay for 2 homes. However, it may not always be the best option.
Image from rismedia.com
1 Avoid rushed sale
By choosing to sell your home first, you are able to take your time with the process and wait for an offer you are satisfied with. You are not rushed to sell your current property in order to move into the next one.
2 Sale Profit
By selling your home, you are able to use equity from the sale to go towards the next purchase of a home. Since you know the amount you receive from the sale, looking for homes within your budget could be easier.
3 Only One Mortgage
If you are out of a contract on your sold home, you will not have the stress of paying off a mortgage on that home as well as your new one. This could give you more options financially.
1 Temporary Housing
One of the drawbacks of selling first is there is potential for a waiting gap. If you have to be out of your old house long before you buy a new one, you will have the stress of finding temporary housing until you can make the move.
2 Moving Twice
The most inconvenient aspect of this sequence is the fact that you will have to pack up your stuff twice in order to move. Costs for storage could rack up, and it could be hard to manage all of your belongings.
Thinking of Buying First?
This option could be the way to go if you have more financial freedom, since you would be able to manage multiple properties. This option could also be risky, but it really just depends on the market you are in.
Image from compassselfstorage.com
1 Avoid rushed purchase
Just as selling first allows you more time to get an offer you want, buying first gives you the freedom to find a home that is perfect for you. You have the gift of time on your side.
2 Control Moving Timeline
In the position of a buyer, you are able to give yourself plenty of time to pack up and move instead of trying to rush out of your old house. The timeline can become more convenient for you.
3 Move Once!
Instead of needing to find a place to rent for a couple months in between homes, you can comfortably relocate from one house to the other since you secured a place to stay.
1 Possible Financial Strain
Since you would be moving into a new house, you could take on two mortgages. This can be financially stressful if you aren’t sure that your house will sell.
2 Rushed Home Sale
If you are in a big hurry to sell your house, you risk settling for an offer that is not exactly what you want.
A lot of these decisions will be based on whether your area is in a buyers or sellers market. Right now, there is a very high demand for homes, so it’s a lot easier to sell a home for more than asking price than to buy a home for a low price. This constitutes a sellers market. At the end of the day, there are many factors that play into the smartest course of action for you. If you have any questions about what’s best for you, contact us! We are happy to help you have a great experience buying and selling a home.
facts from zillow.com