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Selling First VS. Buying First

Roy Singh
by Roy Singh
Owner/Mortgage Broker
May 10, 2016
Making A Desicion For Web Edited
Selling First or Buying First?

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.

Buying First

Pros:
  • 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
Cons:
  • 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.

Selling First

Pros:
  • 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.
Cons:
  • 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.