Should You Sell First Or Buy First?

This is a question that goes back so far, that I'm sure there was a point where a cave man had been thinking about upgrading to a larger cave, and couldn't decide whether to sell the old cave first, and risk being homeless.... or make an offer on a new cave first, and risk owning two caves at once.

I can assure you that after 19 years in the real estate industry, I have come to the conclusion that there is really no 'secret way' to do this without any stress.  Rather, it is for us to establish how to do it with the least amount of stress and, in doing so, we'll surely make you happy.

The entire process is, in many ways, fraught with misapprehension. Many people think that they'll just go out 'house-hunting,' and that the Seller will accept an offer "contingent on the sale of their old house." I have only seen one seller accept such a contingency, so for the most part let's just discount that as not being an option. 

In a nutshell, the overall decision will come down to two important factors:

1. How easy do you feel your old home will be to market and sell?

2. How easy do you feel it will be to find a home to purchase?

Deciding which of these two items will be the hardest to achieve will answer all of your questions at once. If you're currently living in a very sought after community, and you have a gorgeous home on a beautiful lot, I can tell you first hand that selling the home won't be a problem.  That being the case, we may want to do the house hunting for the new home first.

As we begin that process, we're going to want to get a pre-approval done for your mortgage that is not contingent on the sale of the current home.  Several local lenders offer these "contingency buster" mortgage approvals in which they are basically putting aside, in their minds, the fact that if you really did close on both homes at once, you'd temporarily have a very high debt ratio.  Once this pre-approval letter is in hand, we're ready to look at homes.  Having found one, we'll make the Seller an offer, with NO HOME SALE CONTINGENCY, providing our documentation from the lender to that effect. At this point, we'll probably ask for a slightly longer closing, and then immediately get the old house on the market.  If we've done our homework right, the existing home will sell very quickly, and we'll just slide right from the old house into the new house.  This is also really useful if the type of home you're looking for is a very rare or specific home.  You may sit back for a year, pre-approval letter in hand and ready, waiting to pounce on the right home at a moments notice. 

Now.... on the other hand, let's imagine that the home you're looking for is some nice, easy to find property that comes up all the time.  Your current home, however, is one that's nice, but that may be a bit tougher... (by tough, it may mean 90 days on the market...not years!).  In this case, I'd recommend putting the old house on the market first.  We'll get a much higher sale price for it by not having to sell in Panic Mode. We can even sign an offer with a buyer that grants you a 2-week period in which you have to "find suitable housing."  If you're unable to find a home to buy, then the deal is null and void.

Simply put, each situation really needs to be handled on a case-by-case basis.  We'll sit down and run through the different options, and together come up with a plan that makes the most sense for you and your family.

For more information, please call or e-mail us today.

ADVANTAGE JANES REALTY cooperates fully with all other real estate companies and we have access to all available listings in our area.  As experienced Real Estate professionals, we will provide the dedication, honesty, and outstanding service that each client deserves. We look forward to working with you.