Should You Buy or Sell First?

by Lorelei Mangan 01/19/2020

Photo by Mohamed Hassan via Pixabay

You’ve decided to sell your home to upgrade or even downsize, but you don’t know whether you should start looking and buy first or wait to sell first. The best-case scenario is to do both, but that takes a lot of planning. If you are sure your credit is good enough to get the loan you want, you can find a home and you have a buyer for your home all at the same time, the process could be quite smooth. Working with an excellent real estate agent goes a long way to making this scenario go smoothly.

Buying First

If you decide to buy a new house before you sell, and then put your home on the market, or choose to put your home on the market and buy a new home, even if your home doesn’t sell quickly, you will most likely have a place to move to—and can take your time moving. This plan has two hitches, and they’re not necessarily bad:

  • Your house sells quicker than you expected. If it does and you haven’t found a home, or you did, but you haven’t closed yet, you may have to move to temporary housing until your deal closes. On the other hand, if the seller is not in any hurry, you could rent your home back until your deal closes and you get moved.

  • You will have to pay two mortgages. If your current home is not paid off, you will have to pay two mortgages. Depending on your income, you may not be able to close the loan on the new home until you sell your current home. If your debt-to-income ratio has room for two mortgages, this is not a problem.

Selling First

Selling first is probably the safest way to go about moving. Once your house sells, put most of your possessions into storage and find a short-term rental. This allows you to take your time finding your dream home and getting the financing for the new house. Since you have all the time in the world, you’ll be able to shop around for the best mortgage without feeling pressured to take something because you need to close quickly.

Making the Decision

Before you decide on whether to buy or sell first or do both at the same time, determine which is best for your situation.

  • Check your credit score. The better your credit, the lower your new interest rate will be. Lenders will be more willing to work with you.

  • Start browsing for homes for sale to see if there is anything you are interested in.

  • Know how much mortgage you will qualify for. Speak to several lenders about the different available loan programs.

  • Contact a real estate agent to discuss listing your home. Ask about the listing contract and the cost of listing. Some real estate agents give you a discount on their commission if you use them to buy and sell.

  • Know the market. If buyers are flooding the market, it may be easier to sell your home. If sellers are flooding the market, it may take longer to sell your home because there are many homes for people to choose from.

The answers to these questions will let you know if it is better to buy or sell first.

About the Author
Author

Lorelei Mangan

 

Who I am...

As a native of San Jose, I was raised in the Rose Garden neighborhood and grew up in its public schools. I started my own business in my early 20s and moved onto the real estate in 1986, where I have thrived for the last 30 years. As a Realtor®, I strive to make your sale as smooth as possible, utilizing my knowledge, intuition, and experience for the best possible outcome. I want to impress you so much that you will recommend me to your friends and family. In fact, a majority of my business comes from repeat clients and their referrals. There are a few issues I have not seen over the course of my long career. My experience gives me the confidence to negotiate tough transactions and solve any problems that may come up. From studs to sheetrock, I know construction inside and out. I will use this knowledge to help you better understand all of the disclosures and inspections relating to the property as well. I am a mother of two twenty-something daughters, so I am well versed on the schools in our valley. My older daughter, Lindsey, joined me in the business a few years ago and offers a young, technical edge to my established business. Not only do we love what we do, but we are grateful to be working with each other every day. No matter what your real estate goals are, we provide you with honest and reliable service and strive to make you a client for life.

Our Philosophy

Buying or selling a home is one of the most important decisions you will make in your life. I focus on my clients' needs, first and foremost. If you are looking to sell your home, my job is to price it accurately and effectively market your home so you will receive the highest possible price in the least amount of time. As a buyer, you will draw on my experience with all types of properties and neighborhoods. My goal is to direct you to the areas that best suit your needs and to educate you on the loan and sales process. When you find your dream home, you will have the confidence to go forward with an offer. Nothing feels better to me than to have a happy customer moving into the home they have dreamed of and will be proud of for years to come.

To My Clients

I would love to work with you in making your real estate dreams come true. Please contact me to discuss any questions or concerns you may have, or if you are looking to buy or sell a home anytime in the near future. I look forward to working with you!