Finding a house you think is perfect for you and your family can be hard enough. Selling a home, on the other hand, comes with a whole different set of difficulties. When you have to juggle selling and buying at the same time, it is not sufficient to say that the problem increases significantly. You need to budget everything, time the sale and purchase well, account for expenses, and more! So, how to best approach this daunting task? Well, we have put together our tips for buying and selling at the same time to help you out!
Draw up a Budget
The very first and perhaps most important part is making sure you have a firm grip on your budget. You need to know how much money you have immediate access to, how much you could get through loans, and how much you believe your house could sell for. When you know the answers to all these questions, only then can you start looking for a home! Even with a sale lined up already, if you fail to properly budget, you run the risk of running into a situation where you have already sold your house yet cannot raise enough money for a down payment in time. You do not want to end up homeless and waste a ton of money on hotel rooms because of bad planning!
Take Into Account Additional Expenses
Remember an important fact: it is not enough to take only the obvious expenses into account. If you do, come time to move into your new house, you might not be able to afford a moving company. Now, it is true that when looking for long-distance movers, it is possible to find a solution that is cheap and reliable. But why run the risk of looking at the very last moment? Other potential expenses are unanticipated repairs and issues with your newly purchased home. While a house inspection should reveal them and allow you to avoid them well in advance, mistakes still happen. Therefore, it is recommended to hope for the best and plan for the worst.
Hire a Reliable Realtor
If you are unsure of the intricacies of the buying and selling process, it is better to hire a real estate agent. They are an irreplaceable professional who knows the local real estate market like the back of their hand. So, even if you are, in fact, quite confident in your knowledge on the subject, you should still consider hiring one. Not only will they be able to help you time the sale and purchase of your home impeccably, but their connections and inside knowledge will likely allow you to find a ton more properties within your price range than you would have been able to on your own.
Make Sure It Is the Best House for You
It is nice knowing you’ve found the right house for you and your family. However, the aesthetics, location, etc., are not the only things you should consider. What is far, far more important is the state of the house – its furniture, appliances, and fixtures. A house inspection is a must! We have already mentioned its importance and ability to reveal the flaws of a property. You do not want to move in and discover frayed wiring, plumbing issues, or, God forbid, foundation problems. Each one of these would cost you increasingly large amounts of money to fix. To the point where you could have afforded to purchase a much costlier house from the get-go! Fixer-uppers are not all fun and games, and you should carefully think over whether you can afford to tangle with one.
Take Out a Loan or Mortgage
If you require it, the first and basic step is making sure to get your mortgage pre-approved. This will make your life tons of times easier. With the addition of having to sell a house, however, you can do a couple more things. You can sign a contingency contract with your seller or apply for a bridge loan at your bank. A contingency contract means that you will go through with purchasing the house as long as your old one sells. Some sellers are okay with waiting, and if your price is competitive, they will likely agree since it means a larger down payment will be possible. On the other hand, a bridge loan is exactly what it sounds like. You borrow money from a bank short-term with the assumption you will pay it back as soon as your old house sells.
Decide What You Will Do First
You need to decide whether you will try to sell or buy first. And inform your realtor of the decision! If you want to sell first, you will need to either rent a hotel room or strike an agreement with the new owners of your old home to let you stay for a couple of days until you have your new place. If you buy first, things will be easier housing-wise but much trickier when it comes to budgeting. Once you have made a decision you are happy with, stick with it. If you falter and change your mind, you could affect a whole lot of other things, like your bridge loan becoming a useless expense or having to scramble to find a place to stay.
Have a Backup Plan
No matter what you decide, always make sure to have a backup plan! Circumstances change quickly, and sometimes we have to take advantage of an opportunity or lose it. So, always have your papers ready and perhaps even get your bridge loan pre-approved if you need to buy a property in a hurry. And always, always plan for alternate accommodations if you can’t move into a new house immediately.
Final Words
This concludes our tips for buying and selling at the same time! We hope you have found them informative, simple, and valuable. And that you now have a better idea of what to do. Just remember to take your time, plan carefully, and always budget with the future in mind!
About Gerardo Zavala, Realtor
There is a true passion for connecting people with real estate that makes me fall in love with my career over and over again. While my title says, REALTOR® I think I am much more than that. For example, I am present and actively listening to my client’s needs, on the spot when things are urgent, and by your side to say “congratulations.” Most of my clients will say that I am a connection away from support no matter the situation, day, or time. In my opinion, customer service, educating the client on progress and next steps, and overall satisfaction are my top priorities. How can I help you?
