How To Buy And Sell A House At The Same Time
Buying a house is exciting and one of the most significant real estate investments that you can make in life. However, it can be stressful too. Especially if you are looking to sell your current house at the same time.
The key is to make sure that both transactions go smoothly without any surprises for either party involved. This blog post will cover how you can buy and sell a house simultaneously with little hassle from start to finish.
Evaluate the Real Estate Market
Timing is an essential factor when it comes to buying and selling a house at the same time. If you consider this option, make sure that there is demand for your property in the market before taking any steps forward.
Knowing what kind of market you're in will determine the best time to buy and sell a house and help you avoid any pitfalls that come with buying or selling at an inopportune moment.
Evaluating the market also helps protect your financial situation from overextending due to having two mortgages for one property. Overextending can happen if you don't have enough equity built up in your current home before signing on the dotted line of a new purchase loan for another house in addition to it.
Find a Qualified Real Estate Agent
Buying and selling a house at the same time can be overwhelming to many people. It helps if you have a real estate agent that can guide you through the process and answer any questions that may come up along the way.
Finding a good agent will help you get a better experience in your transactions. A good agent will offer advice on what's going on in the market, provide insight into how lenders are handling things, lay down expectations for closing dates, or even negotiate with other parties involved. Hence, everyone comes out happy at the end of it all.
Determine Which Property You Will Focus on First
You decide to sell your current house first before buying a new place or buy the new house and then sell yours later. Each of the options has its advantages and disadvantages.
It's essential to be informed first before deciding which choice is best for you. It's also important to be prepared with a backup plan if either transaction falls through due to unforeseen circumstances at the last minute.
Sell Your Current House First
From a real estate market standpoint, it makes sense to sell the house before buying another property.
You can do this by listing your home first and look for another place after selling it.
Selling your home first will also ensure that you aren't losing money every month due to paying two mortgages at once while buying a new house through the purchase loan route. In addition, it can help keep things afloat financially in case your current home doesn't sell as quickly as expected or if other unforeseen issues arise along the way.
Pros :
- You'll know how much is the budget for the new house before going ahead with the purchase.
- There won't be a second mortgage which can affect your ability to get a loan for another house.
- It also provides time for buyers and sellers to work out any issues before they become a problem which ensures there won't be surprises along the way.
Cons :
- Renting a temporary storage room and double moving can be expensive.
- It can take longer to sell your house if it's not in a good location.
- You need a temporary living situation, whether with your parents, family members, or friends.
Buy A New House First
If you choose to buy a new house before selling, you can do it by offering the seller a sale contingency, where the offer is only good if your current home sells within a specific timeframe.
On the other hand, you can purchase it using your savings if you're financially stable. If you cannot buy it in cash, you can ask your financial institution for a mortgage to help buy the new house.
You can rent the old house first for individuals who don't need the money from their first home to make a down-payment. Renting can help you cover the mortgage costs while you're still unable to sell it.
Pros :
- You won't need temporary living arrangements since you can move right away.
- You'll only be moving once, which will save you time and money.
- You can avoid impulsive decisions that you might regret later on regarding the new property.
Cons :
- The sale of the house may fall through if your current home isn't able to be sold in a quick amount of time or for an acceptable price.
- You need to make sure that you have enough money saved up before agreeing to purchase anything. Not having enough could lead to problems with financing and drain your savings quickly when trying to sell it afterward.
- If you decide to do it, renting out your first home can be challenging since being a landlord has its difficulties, and it's hard to sell a house with temporary tenants in it.
Final Thoughts
Buying and selling a house at the same time is tedious, and there are a lot of factors to consider. However, being prepared and knowing all the information can help you pull it off without a hitch and lead you to become a happy seller and buyer.
