A lot of strategizing is needed if you are looking to buy your current house and sell your new home at the same time. The timing of it all has to be perfect. We know that in your dream scenario you would sell your house for the highest price, buy your new home at the cheapest price and have it all go smoothly! Here is some advice on how to buy and sell your home at the same time.
Sell Your Home First
Many real estate professionals recommend that you sell your home first because it causes the least risk. This situation allows you to know (once your home is sold) how much money you have to buy your new home. If you can’t find a house fast enough after closing on your old house, consider living with a relative, rent a hotel room (and putting your furniture in storage) or even rent a new home temporarily. Unfortunately, your temporary living situations means that you would have to “move” twice, but we hope that you find a new home fast!
Buy Your New Home First
If you are financially able to do it, buy your new home first. Because paying for two houses at once could cause financial strain, this is the riskier option – but it does have its upsides! For one, you wouldn’t have to worry about needing a space to live in while finding a new home to purchase.
Additionally, some might choose to buy first because they have found their dream home for a great price and don’t want to pass the opportunity up. The risks that you might run if you buy first is that your current home won’t sell quick enough. This might require doing some bride financing which can be very costly. If your home isn’t selling fast enough you might feel the pressure to sell it and end up selling it for a lower price than you wanted or anticipated.
Ideally, from a logistical perspective, closing on the property should occur a few days before closing on your current house, minimising the hassles and risks involved in moving from one house to another.
Bridge financing can be used to ease the process of buying then selling. It basically allows you to own two homes at once. Bridge loans are similar to personal loans and have higher interest rates. This is because they are expected to help you finance owning two homes, which ideally should be for a short period of time. When the time between buying and selling lasts longer than expected is when bridge financing gets expensive.
Obviously there is no right or wrong way of going about selling and buying your home. It all depends on your specific situation. One of the most important things to look into is your finances. There are many ways that it all can go down and its important to be prepared!