Selling a home and buying a home can be a complicated juggling act. Before you start it’s best to understand the different options you have and how best to navigate your choices.
1. Are you willing to own two homes at the same time? If you are then it makes sense to find the home you want to buy prior to selling your house. If not then don’t look in earnest until you have your home on the market and in contract, or even better yet closed. I had a client selling a home, he has three young children and was building a new home. He could afford to carry both homes and decided to put his home on the market 30 days before his home was done. Due to family concerns he absolutely refused to have a temporary move. He priced it low enough to sell quickly and it went into contract in two days. He may have left some money on the table but he likely came out ahead if you factor the expense of moving twice or holding costs to own two homes for a few months.
2. Are you willing to move twice? If you aren’t able or willing to carry a mortgage for two homes then it’s simple. Just don’t write an offer on another home until yours is in contract. But now you run the risk of needing temporary housing and moving twice. Each strategy has a cost and a benefit. The cost is moving twice and the impact on your family. The benefit is avoiding owning two homes at once. I had another client selling his starter home and also building but he had no interest in owning two homes at once so he sold his home early in the process and moved in an apartment with his family for several months. For him the cost benefit was simple
3. Are you willing to find a home and not be able to buy it?How frustrated will you be to find your new dream home but not be able to buy it because your home still hasn’t sold. If you are buying in a market with an ample supply of homes to chose from then the risk is low. If you are selective or looking in a market with limited options this will become very stressful. There are two ways to avoid it:
- Be prepared to own two homes at the same time.
- Don’t look in earnest until your home is in contract and be prepared to find temporary housing if you haven’t found something but have already sold your home.
The idea is to be in control of the process and to understand your options before you fall in love with something or find yourself stressed by the situation. Being in control and having a game plan will minimize your stress levels.