When it’s time to list your home the best advice I can give is to map out an action plan, especially if you are going to also be buying a home. Selling a home is a stressful affair and if you work on a plan you will start to take control of the process. By taking control you will minimize your stress .
I have a seller relocating and his plan was to pick the right time to list his home. Should they list early and risk being homeless or wait till they are ready to move and risk owning this home while paying for housing in their new city. After careful consideration and looking at market conditions they put their house on the market early and it sold to the first buyer. Now they are working to implement their plan, whereby the wife is moving in with her parents and he is rooming with a friend here for a few months until his job allows him to relocate. Their plan minimized their exposure to financial risk.
I have another client looking to sell their starter home and move to something larger. Do they put their home on the market before finding a home to move into? Where do they live if they need temporary housing? Or do they look for a home before theirs sold and could they afford to own two homes at the same time?
My client can afford two mortgage payments. Their current mortgage is under $1,300 a month so if they own two homes at the same time they will likely have 2 or 3 months of mortgage payments. The real cost to them will be around $4,000 for buying a home then selling their home. Plus they would be more likely to value price your home to minimize the holding period. The way to avoid this is to sell their home and then start looking to buy. But there are cost involved with this strategy. They have to hire a mover to store their household goods plus find a short term rental. Corporate housing is around $3,000 a month. A cheap hotel can easily be $1500 to $2000 a month. Short term rentals may be hard to find and will likely be $1500 plus a month. Plus add storage to the equation.
Cost of owning two homes at once;
- Easily $4,000 holding costs
- Likely sell for a lower price since seller will be more negotiable and will be move inclined to value price the home
- Depending on the home you are selling it may look nicer and more staged if sold while you occupy it
Cost of selling your current home and potentially being homeless
- Temporary housing or short term rental
- Storage fees
- Headache of living somewhere temporary
Each situation is different. Take control and work with your agent to develop a good plan that works best for your situation.