By: The Rick Wearing & Sandra Parrott Team
When you’re thinking of selling your home, cottage or condo and buying another, you’ll likely face the inevitable question: should you list and sell your property first or buy your new property first?
Let’s take a look at both options:
If you attempt to buy a property before listing your own property, you might run into a couple of challenges:
Sellers may not take you seriously as a potential buyer. After all, you haven’t put your own property up for sale yet. As far as they’re concerned, you might merely be testing the market.
Your property might not sell as quickly as you think it would. In fact, in our experience this is quite often the case. Many Sellers anticipate that their property will sell more quickly than it typically takes to do so. We can give you an idea based on market driven statistics exactly how long it should take to sell your property. A few other variables come into play such as: the property you are selling is priced at fair market value, it is in good condition & “shows well” and there are no external adverse factors that will affect the sale, such as being a residential home situated in a more commercial area, or beside a landfill!
If there is an early closing date on the property you are purchasing, you might end up owning two properties …. which may mean paying mortgages, realty taxes, utilities and ongoing upkeep on both properties, at least until your property sells.
If, on the other hand, you list your property before buying a new home:
Sellers will know you’re serious. That puts you in a competitive position in the event of multiple offers on the home you wish to buy.
Your offer would not need to be conditional on selling your home and you might be able to negotiate a more favorable purchase price and other terms due to selling your property first and not having your offer conditional on selling your home.
Also, if your current home sells quickly, you’ll have peace-of-mind knowing exactly how much you can afford for a new home based on a solid knowledge of the sale price you have received for your own home. You’ll be able to shop with confidence for your new home and put together a solid financing plan in advance, if in fact you do require financing.
Of course, like the first option, there is a slight chance that if the closing dates don’t match up, you’ll end up owning two properties for a period of time. However, solutions such as bridge financing are available to help if this scenario did occur.
In the end, there is no perfect answer. There are a number of variables to consider such as:
- the state of the local market
- current economic factors and variables in the province and the country, even in the rest of the world
- your personal financial position and wherewithal
- your ability to deal with and handle the stress of possibly owning and carrying two properties at the same
- the list price of the property you are selling
- the condition of the property you are selling
- are there any locational factors or conditions which will affect the sale of your property
During our length of time in business and our extensive experience in dealing with matters such as these, we have gained a lot of insight into what might be best path of action for you based on the many other situations we have seen in the past. We would be happy to discuss your situation with you and advise you accordingly which will ultimately help you decide which the best move is for you.
For a private, personal consultation about real estate matters of interest to you, please do not hesitate to contact us today.
Call 705-788-3535 or email [email protected]