What should you do? This is a huge decision that could cost you thousands of dollars if not lose you the house you really want. Having a house to sell in order to buy your new house is a dangerous dilemma to leave yourself in. This is a question that I get often, this is a question I need to give advice on in order to save my client thousands of dollars.
Selling your house before you find a house you would like to buy has some huge advantages, especially in a good buyers market, but you are definitely taking some risk when it comes to arranging possession dates.
The main advantage to selling your house before buying your next home is that when you make your offer it is alot cleaner, there will not be a condition of selling your house and this will make the seller to be more receptive to your offer price.
What do I do if I sell my house but cannot find another house before I have to give possession on my house? The simplest answer is, plan to stay with parents, in-laws or friends, this is a worst case scenario but it is possible to happen. As your agent I will do everything in my power to ensure this doesn’t happen but you do need to know there is always this chance.
Buying your new house before you sell your house also has some good advantages to it as well. If you are in a Sellers market and the inventory of homes to choose from is not that strong this may be your best bet to get the house you want.
There are a couple major negatives to putting an offer in on a house before you have sold your house. The first and most significant consideration is that you will have to include a condition that your house sells before you offer is finalized, this is usually followed by the inclusion of a 48hr clause from the seller. A 48 hr clause will allow the seller to continue to market their home to potential buyers and if they receive another acceptable offer can give you 48hours to remove all your conditions or you will have to release your offer on the house. This can be very stressful if you have found the house you love but cannot sell your house in time to finalize the purchase.
The second negative to putting an offer in on a house before your house is sold is that you will usually pay more for the house in the end. What do I mean? Well the seller will probably ask for more money on the counter offer because they are limiting the ability to market their house while you have a conditional offer on it, than when you go to sell your house you are more willing to accept less money just to get the deal done so that you can move into your new house. I have seen a scenario where a buyer has payed an extra $2000 on their offer and when it came time to sell their house they accepted an offer $3000 lower than they had intended to when they first listed their home. In the end these buyers moved into the house they wanted but it cost them an extra $5000 to do so.
There is no right or wrong answer to this question, every situation is different and every buyers motivation is individual to them.
If you have any questions about the current market or if you should look at selling your house before you start shopping for you new house. Please feel free to give me a call and we can sit down to talk about your situation.
Royal LePage – Martin Liberty Realty
Cell: (204) 573-1060