Do you Buy First or Sell First? This is a question which must be answered any time you are considering a move. There are pros and cons to each strategy and the decision should be based on understanding the current market conditions around what you are buying and what you are selling.
This strategy makes sense if you are in a hot sellers market where bidding wars are common or when consistently rising home prices means you can sell your currrent home at a higher price down the road. Buyers with specific needs may also want to consider buying before selling as the home you are looking for may be difficult to find. The disadvantage of buying first is that your current home may not sell in the time period required and you may end of making payments on two homes or selling your home for less in order to stay within the time line. It may also be more difficult to come up with a sufficient down payment if you require the equity in yoru current home in order to buy your new home. When buying first, always check with your mortgage broker or bank to determine if you qualify for bridge financing, just in case you have to close on your new place before your current home sells or closes.
There are definite advantages to selling first. You have clarity of your NET equity from your home, Meaning that you know exactly how much money you have to work with and you can feel confident going forward to purchase your next home. As well, you may not feel the same hurried pressure to sell and can wait for the ideal offer and terms. The disadvantage of selling first is that you may find yourself under pressure to purchase your next home. This can sometimes be easier if you are looking at new homes or subdivisions. However, with so many people moving farther from the core of the city, the competition for homes continues to grow.
If you cannot find your perfect home in time you may have to arrange a double move and consider short term leasing etc. This can be stressful and can end up costing thousands of dollars.
The best advice: Gather all your information before you sell your home or buy your next home! Local real estate markets are always changing and it's best to get all the facts before making such a huge decision!
The Mulholland Ross Team will help navigate you through these questions and help you determine which options are best for you and your family. Our clients appreciate the time we spend with them 'up front' working through all the options and ideas. Call anytime to discuss your plans 416-230-8500