May 10, 2016
Buying and selling this spring? While there’s no one-size-fits-all answer to the “buy first or sell first” predicament, there are pros and cons to each approach that everyone facing this decision should understand.
- You can search without pressure for the right property rather than making compromises you’re uncomfortable with because you need someplace to live
- You can move straight from your current home into your new one, saving you the cost and stress of interim living arrangement
- You could have two mortgages to qualify for and to pay, an even riskier scenario in a buyer’s market than it is in a seller’s market.
- You might feel pressured, out of desperation to sell, to accept a lower offer than you would if you hadn’t already bought your next home.
- You won’t be able to take the equity from your current home’s sale into account when budgeting for your new home.
- You won’t have to worry about paying for two homes at the same time.
- You won’t feel under deadline to wait for the best possible offer on your home.
- You’ll know the exact proceeds from your current home’s sale, allowing you to better determine an appropriate price range for your next property – and you’ll be able to use those proceeds for the purchase.
- Unless you can seamlessly dovetail your closings, you may have to arrange short-term accommodations (e.g., renting, staying with family) and move twice, or arrange interim financing for your down payment.
- You might feel the need to rush your home purchase, and that pressure could lead to rash decisions like overpaying or making regrettable compromises on features.