Should I sell my house first before I buy or vice versa?

Dated: 06/05/2019

Views: 7

There's no easy answer, purchasing or selling comes first. Whatever comes first on the other hand of the equation will put extra stress. But there's an order for you to make sense. The first step is to look carefully at your finances, your readiness to move twice, and the market circumstances you buy and sell.

SELL YOUR HOUSE FIRST

Pros: 

You're going to have money for a down payment

No risk of juggling two mortgages at once

No pressure to reduce the selling price rapidly

Cons:

You may need to relocate twice

Removes your investment from the property market

Presses you to rapidly discover a fresh home

If you're like most of us, there's no money to make a down payment on your new house and enough earnings to make two indefinite mortgage payments. So it may seem like first selling is the intelligent decision, if not just. But first selling leads to one big issue: where are you going to live in the moment between selling and purchasing?

GAP HOUSING

If you sell your home before you buy a new one, you will almost certainly have a gap of time between having to be out of the old house and when you can take possession of your new one, whether it's days or months. Would you like to move twice, first to a rental or with friends or family that are highly hospitable? Can you discover a month-to-month lease rental?

Selling your home, renting an apartment and giving yourself some time to take a breath and look around may seem less stressful. But first, look at the market for housing. Time is cash in a growing industry. You're out of that market once you've sold your house and the longer you're waiting to get back in, the more without you it will rise. It's no fun to look at the importance of the home you sold soar along with the prices of prospective fresh homes while sitting out a six-month lease. You may be able to afford to sit out for a while if you're in a slow market, or "buyers ' market." But don't wait too long or you may be turned around by the market.

If you could sell your house but stay in it until you buy a new one, wouldn't it be lovely? With the correct selling agreement, you can. It's called a provision for rent-back. Essentially, you negotiate an agreement to become a tenant until you can purchase and move into a fresh house when you sell your house. You're going to pay at least enough to cover your mortgage deposit, but you can remain put until your new home is prepared, which can be invaluable. Naturally, there's a hitch. If you sell with a requirement for rent-back, you will probably receive fewer deals. You will also have a comparatively brief window of time to discover a fresh home as customers will likely not want to wait for months to enter their new home.

CONTINGENCY OFFER

From your point of view, the most attractive choice is to create a "contingent" offer on your new home. What this means is that when and when you sell your present home, you enter into an agreement to purchase the fresh home. But nothing is as simple in life like that, so there is a downside, of course. A contingent offer is likely not to be regarded too seriously in the industry of a seller. 

Sellers are already stressed to sell their own home, now you are asking them to stress that you are also selling yours. Also, if not all of your bargaining space, a contingent offer eats up most. So the asking price will be the floor, not the ceiling of your offer unless the building is severely overpriced. 

Talk to your agent about whether, given local market circumstances, a contingent offer makes sense.

Darryl Baskin

eXp Realty Northeast Oklahoma

101 Park Avenue, Suite 1300

Oklahoma City, OK 

918-732-9732

No cost, No obligation assessment: askinforbaskin.com

Pamela Wright

The Baskin Real Estate Specialists

CELLPHONE

918-370-2801

EMAIL

pamela.wright@exprealty.com

WEBSITE

thewrightone.exprealty.com

Sabrina Shaw

The Baskin Real Estate Specialists

101 Park Avenue, Suite 1300

Oklahoma City, OK 

918-732-9732

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