Do You Buy or Sell First?
There comes a time in your life when you outgrow your home. Your family has grown and you simply need more space to have a functional household. When this happens, homeowners tend to linger on the question, “Do I buy or sell first?”
If you are in this predicament, you are not alone. 42% of Ontarians are concerned about whether to buy their new home before selling their current home.
The first step to help you find the best answer is to get the right help. You need to find the right real estate professional for your needs. A good place to start is by asking friends and family for referrals and meet with at least three candidates. I know that is the first I turn to for recommendations.
My next step is to head online for resources. Since I live in Ontario, I found a website that can check the status of registered real estate professionals and find out what questions they should ask before deciding whom to hire. RECO regulates real estate pros in the province and protects the public interest through a fair, safe and informed marketplace. To me, that sounds like winning already.
In a recent survey sponsored by RECO, 800 Ontarians were surveyed and indicated they have bought or sold in the past two years or are considering buying or selling real estate within the next two years.
I think anytime we make a large investment in buying or selling a home, we have many reservations. 70% of young people are worried they simply just don’t know enough about buying or selling a home. While 84% worry about being able to afford it. 76% claimed that they worry about the affording the possible associated costs that come with owning a home like home repairs or renovations. 60% were worried if they could keep up with mortgage payments and 68% were concerned they’d be outbid in the process.
While I am slightly under the age margin (I’m 32) but, we are in our second home and we have considered getting into another home in future if we need to. Ontarians aged 35-54, who have already bought and sold their first homes have fewer concerns than their younger counterparts. Their biggest concerns are very different from the other groups.
For example, 57% worry about how long their home will sit on the market when they do decide to sell. 52% of them are less concerned that the real estate bubble will burst than younger people.
There really isn’t a right or wrong answer to this question. But, as with any situation, there are always pros and cons to consider! Having a good contingency plan in place is optimal, you can even learn more by reading this blog post.
TIP: Get in touch with a registered real estate pro before starting the buying and selling process.
In the case your closing dates don’t align, it can potentially leave you with two homes or no home, for a period of time. No one wants that!
If you choose to buy first, there are a lot of positives that can make the process much more pleasant. For example, not having a closing date looming on your existing home, you’ll have time to wait until the right home comes up for sale. If you do make an offer on a home and it doesn’t go through, you can always wait until for the next one!
The cons of buying first can result in not selling your house fast enough and ending up with TWO mortgages to pay. It can also affect the chance of securing a mortgage for the new home as well. So, that’s definitely something to think about.
TIP: If you do make an offer, protect yourself by making it conditional on the sale of your current home.
Keep in mind that adding this condition to your offer may make it less attractive to the seller. But, it gives you the option to back out if things don’t end up working out on all levels.
The biggest advantage of selling first besides not ending up with two mortgages is the knowledge of knowing how much the sale brought in. Helping you see how much of a budget you have to work with for your new home.
The only issue is that you will have a closing date looming over you and if you don’t have a plan you may end up rushing the buying process and settling for a home that isn’t for you or paying more than you wanted to because you feel the ticking of the clock.
TIP: Have a back-up plan, consider a short-term rental or moving in temporarily with friends/family.
By doing so, it can help you to purchase the home that is ideal for you. Without making a decision under pressure or in a rush and could end up resulting in a buyer’s remorse.
If the purchase of your new home closes first, you might need something called “bridge financing” to cover the down payment and other closing costs until the sale of your current home closes.
Ready to WIN?
Whether you are buying or selling a home, RECO wants to help you out. One lucky Whispered Inspirations reader will WIN a $200 Lowe’s Gift Certificate! This giveaway opens on February 11th, 2016 and ends on February 26th, 2016.
At the end of it all, whether you choose to buy first or sell first, it’s important to remember that a registered real estate professional is knowledgeable about market conditions. They will help you find solutions throughout the entire process. Plus, find a plan that works for you.
Also, remembering to use resources available to you and to find the right registered real estate pro. It can make all the difference! They can answer all of your questions and put your worries to rest. I’m a firm believer that finding the right agent or broker, can be so helpful. Make sure you visit RECO to find the right one for you.
Have you outgrown your home?
Will you buy or sell first?
Let me know, til then–cheers m’deres!
Nancy Polanco is a freelance journalist and editor of lifestyle blog Whispered Inspirations. A social media junkie, a travel-lover with insatiable wanderlust and an aficionado for fun gadgets, good eats, and entertainment. You can find her on Instagram and everywhere else under @WhispersInspire.