I’m always asked is it a good idea to sell or buy a property first. There are many strategies that go into both scenarios. It really depends on what type of market you are in. If you are in a sellers market, I suggest buying a house first because it will be easy to sell your house and harder to find a house to live in. The same goes for the opposite. It also depends on what your asking price is relative to what is on the market and what has just sold. Are you above? Are you below? If you are above the market and don’t sell your house quickly, can you afford to keep two mortgages until you find the right buyer that will pay your high price?
If you buy a property and you need the money from your current home, you might have to reduce your price significantly in order to find a buyer fast, if you do not price your house accordingly. Strategies of buying and selling Real Estate are crucial when you plan to list or buy a house.
Buying a house first: You find a house you love. You put in an offer and buy it. Now you must unload your house. Let’s say that you gave yourself 90 days. In most scenarios this is more than enough time to sell your house. If you are in a buyers market than you need to be aggressive with your pricing. You might have to lower your price below the comparables to find a buyer. In a sellers market you could speculate a bit longer but you don’t want to get into a situation where you are holding on to two mortgages. It can be very costly and you might not be able to budget for both mortgages. Each scenario is different and each individual situation is as well.
Selling a house first: Its a sellers market and you want to sell your house. It goes within a few days and you get top dollar. Now you must find a house. The problem in this scenario is that there is no inventory and now you have nowhere to live if you cannot find a house before closing. Also when you do find a house, you might have to pay a higher price because of the market. At this point if you don’t find something you might have to settle for something that is not 100% what you wanted or rent something for a few months or move in with the dreaded in-laws… OUCH! Watch out!
So there is no real answer to this question, it really depends on the situation. Its a great discussion and there are many ways you can look at both sides of the equation. You should prepare for each situation and all outcomes, especially if you are going against the grain. Talk to me your agent on what is going on in the market IN YOUR NEIGHBOURHOOD, and plan a strategy.