When buying a new property, one of the first questions people often have is whether they should sell their old property first. There are advantages and disadvantages to following either method of home buying. So, within this article, we’ll review these factors and give you a full birds-eye view of the process so that you can figure out which method is right for you and your family.
Reasons to Sell First Before You Buy
Many industry experts will tell you that it is far better sell your property first before you purchase a new one. There are many reasons that selling before you buy is considered the right approach.
- When you sell first, you will have the luxury of being able to take your time during negotiations and could therefore purchase new property for a cheaper price.
- You will be able to immediately put in serious offers on homes, which will give you an advantage in the marketplace over those that haven’t sold their properties.
- Selling before you buy takes a lot of the mental pressure off you and your family, as you are able to relax and focus more intently on the home purchase process.
Remember though that in order to maximize the benefits of selling a property before buying a new one; you must give yourself a long enough sale closing period in which to negotiate prices on new property without having to worry about locating temporary housing.
Why You May Wish To Buy Your New Home First…
Those who are interested in a specific property that has great market potential and lots of interested buyers may not be able to wait to purchase the home. Therefore this could be one of the reasons that you enter into the homebuyer’s market before selling your property. Here are a few more circumstances in which you may find yourself having to purchase your new property before you sell your current home:
- For those with families, it’s important to have the security of knowing that you have a new property to move into the moment you decide to sell.
- If the local real estate market within your area is experiencing a dip in values, you may wish to take advantage of the low prices and enter into the homebuyers market while there are great deals to be achieved. Being a proactive buyer, can therefore help save you money on your purchase.
While these are a few of the circumstances in which it might be best to enter the market quickly before you sell your property, it’s important to understand the risks of taking on this sort of challenge. If you experience any difficulty selling your property for the price you might have expected, you could end up with two mortgages to pay. And most people simply cannot afford this level of financial risk.
The Middle Ground…
There is alternative to both of these options however. Many homeowners make the completion of their property purchase contingent on them selling current their property first. Usually though, these sorts of conditional offers allow for others to continue bidding on your chosen new property while you wait for your current home to sell. Therefore you do run the risk that another buyer will swoop in and outbid you.
It’s important to go over all your options before making the decision to buy or sell. Some people find themselves running into problems because they haven’t considered all the possibilities. So always ensure that you’re well aware of the potential outcomes of any decision that you make regarding your transition from one property to another. The preceding advice should help to act as a guide as you go through the process.
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