For this conversation on buying home selling home first or second, we are dealing with Colorado Front Range housing market. That’s important to mention as this marketplace has been a Sellers Market for quite some while now.
Yeah, I’m going there. Which comes first? If you are ready to buy your next home, do you buy first or sell first?
Buy First Of Course
All your hard work to maintain a great credit score and income have paid off. You have the comfort of buying without all the stress of first selling.
Heck, you might never sell your old house. You can keep it as a rental property – great way to create (additional) long term financial independence.
Your purchase offer needn’t be contingent. This can make your buying power as strong or better than a cash offer (depending upon how we structure it!).
And, with the multiple offer scenario out there, if we don’t get the first one, no pressure – you are not on a timeline to move quickly.
I just helped longtime clients C & A buy a new home without having to sell. We were able to negotiate a great purchase price below list price. And C & A were able to rent their existing house immediately.
Sell First, Buy Second
Some times, its not about your income or credit score. Comfort zone can play a big roll. The stress of two mortgages can be horrid just to consider.
Maybe your down payment is simply tied up in the equity position of your current residence.
Whatever your case might happen to be, when considering buying home selling home equation, you need to sell first.
In the previous real estate sales cycle, it was feasible to buy a home, contingent upon the sale of another. These days, that is very difficult to accomplish.
So you’ll need to market your house for sale first. Once you have a contract, you can start looking for a new home. You might be able to squeeze out a contingency offer with your under contract property.
Be prepared to have to completely sell and close on that existing house before you become a home shopper.
While many home buyers will rent back to home sellers (where you are the seller), there is generally a finite amount of time you can rent back. Two months is very doable. Longer than that, the buyer’s mortgage officer may have concerns about the financing.
When selling first, you might need to make two moves and temporarily rent in another location. The two moves can be a drag. Living out of boxes and all that. Why would you need to even consider this?
Inventory Impacts Buying Home Selling Home Conversation
The lack of house choices might rear its ugly head the moment you sell. If your new dream home is not readily available, because you sold, the clock is ticking for your move. Even if you don’t find the perfect place to go.
While this might be a temporarily annoying necessity, keep in mind – when the right house does come along, you’ll be in a great position to make a contingency free fast closing offer!
Just Winging It Until Something Strikes You
This is an emotionally challenging course of action.
As houses come along, you view some here, some there. After all, you are not in a hurry. Maybe you are okay with, “if its meant to be…” The catch is, when that ideal property comes along, what happens next?
First, keep in mind that we are in this incredibly competitive marketplace. So while you might be waiting for the right house to tickle your fancy, the competition is chomping at the bit. You are bound to run into multiple offers.
And this can raise a sticky issue. Are you prepared to buy without an official contingency? Yikes. That doesn’t sound good. I mean, here you are reading my blog and I’m suggesting an offer without an official contingency.
But, in a multiple offer scenario, for the perfect home, home buyers in 2018 will be faced with dilemmas about how to win the negotiating battle. And what concessions to make in house buying negotiations.
Rather than wing the buying home selling home first conversation when you find the best house, better to discuss and plan for this moment.
It really can make a world of difference to successfully moving into your new dream home!
Which Came First? The Chicken or the Egg?
Who knows. My siblings and I still debate this. And, similarly, there is not one formula for home buyers (even ones currently leasing – do you sign another year’s long lease or an expensive month to month lease?).
Just a good idea to have the buying home selling home conversation early on in the Colorado home buying process.
Boulder Real Estate News Author Recommends
Luke Star addresses buyers remorse and how to avoid it. A good tip from the post – test drive the new commute before you purchase! Bill Gassett, blogging pro out East writes on moving tips. Best suggestion: clean your new house before you move in! Will this be your first time home buying experience? Check out this To-Do Home buying list! And also read Rochester agent opens up about simple home improvements before you sell. He’s right in suggesting fresh flowers. A touch of color at your front door, in any market, can have a big impact on curb appeal and buyers feeling good as they enter your home.