The scenario of buying and selling your home at the same time has been coming up more recently now that the housing market in Sudbury has entered a more balanced state. In a very competitive market, you can still buy a new home and sell your existing one at the same time but it is definitely more challenging. The key to doing this successfully without having to find temporary housing is having enough time to work with.
The pieces to this puzzle are simple but the order of events is often concerning. You are going to buy a home and you are going to sell your current home. Which do you do first? Do you need to sell first so you can then have the money available to go and buy? Or can you buy first and sell later? What happens if you sell and can’t find another home? What if I buy a home and haven’t sold my current one?
If you have another home that you can move into while you sell your house and find another one (like your parent’s or kid’s or friend that is willing to put you up) then you can tackle this in whatever order you wish. Most people don’t have that luxury and need some better security when buying and selling homes.
Everybody’s situation is going to be different and the order you choose will make sense to your family. The best way to tackle this situation is to find the home you want to buy first. While you are searching for your new home, get your current home prepped and ready for sale. De-clutter, paint, stage and do all of those little repairs you have been putting off. When you find the home you want to buy, your agent will guide you through making an offer conditional on the firm sale of your home. This means that you will not be forced to buy the new home if your current home does not sell. This condition generally is set up with a timeline to get your home sold so that the seller of the other home doesn’t have to wait indefinitely for you to sell your place. That is why it is a good plan to get your home ready such that when you put in your offer, you can quickly get your current home on the market.
When you add in a condition to a purchase offer on the sale of your home, the seller usually is allowed to continue showing the home to other potential buyers. The seller wants to sell their home as quickly as possible and for the most money possible. The seller can accept your conditional offer but if another offer comes in that they want to work with, they may choose to do so. Again, depending on how your offer is structured, the seller typically has to give you notice and an opportunity to remove the home sale condition from your offer. If you remove the condition, then your offer stands and you are now committed to buying that house even if your house doesn’t sell. Risky business! If you don’t waive the condition, then your deal will become null and void and they will work with the new buyer.
Ideally, you will want to set up the sale of your home to finalize on the same day or a day or two earlier than the closing of the home you are wanting to buy. This helps to make sure the lawyers have enough time to transfer the funds for the home transactions. You can line it all up for the same day but make sure your lawyer is aware that is happening so they prioritize the transactions. Another option is to ask your lender for bridge financing. If they agree, that will allow you to hold both properties for a short period of time as the sales finalize.
Still not quite clear on how buying and selling your homes will play out? Feel free to connect with me and I will happily walk you through the scenarios and answer your questions.