I get asked all the time….Is it better to sell my home first and then buy, or buy first and then sell. There is no right decision as there are advantages and disadvantages to both scenarios. With thoughtful planning from the beginning, home owners can minimize their risks and complete both the buying and selling successfully.
Some people think that selling first makes the most sense, and in some cases this may be true. Although it is a good feeling to have your house sold, if you can’t find a new home to buy in a short amount of time, that could leave the owner in a bind. Selling first makes the most sense in a buyer’s market when there are a lot of properties available for sale, and not as many buyers competing for those particular properties. In this case buying should be easier since there is a larger inventory of houses to choose from. However, this can backfire if your dream home does not turn up right away. You may be forced to move twice or left unsatisfied with a panic purchase unless you get lucky and find what you are looking for.
If home owners buy before they sell, they are more likely to end up with their dream house since they have taken the time needed to find the right property. This strategy makes the most sense in a seller’s market where listings sell off very quickly and there isn’t much inventory to choose from. Caution must be highly noted from buying first. Home owners can find themselves forced to sell at a discounted price. This scenario can be avoided with a clause in the sale agreement making the purchase conditional on selling first, but many sellers refuse to accept this clause.
My advice to home owners is to combine the buying and selling process together. This strategy will get the best possible results in any given market. Firstly get the property listed for sale. In this situation, the home owner has not purchased another property therefore there is no time crunch and they are able to be more aggressive in choosing their selling price. If they are aggressive with their listing price, there is a better chance they could sell for a larger profit and use the funds towards their next purchase. Once the house is listed for sale, home owners can be more selective on searching for their new home and there are no pressing deadlines. This will well position the home owner to maximize their chances of success in both transactions.