To buy or sell a house first? That’s the question and depending on who you talk to you will likely get a different response and that’s because there are many factors to consider. If you live in Markham, Unionville, Stouffville or anywhere else in the GTA, the underlying principles will always be the same.
One of the more important factors to consider is the current market. In a hot seller’s market, you shouldn’t have any trouble selling your home if it’s presented and priced appropriately but finding and buying the right home might be a tougher task. Typically, in these conditions, many homeowners prefer to buy first because they’re scared of not finding the right home in time, but that also opens up some added risks.
First, you must consider the possibility of potentially owning 2 homes at the same time and dealing with all the associated costs if your home does not sell quickly. Many sellers assume that their house will sell itself in a hot market but conditions can change very quickly and often without notice. That’s something you should be prepared for. Also, if you commit to buying a house first, you may feel a little more pressure to price your house more aggressively, either right away or down the road if your house doesn’t sell quickly.
Your current financial situation will also play a vital role. Maybe money is not a major issue for you and owning multiple homes is feasible and an acceptable risk. Either way, if you’ll be needing a mortgage, you should check with your lender to discuss different scenarios and find out if they’ll back you.
The obvious benefit to buying your home first is that you can really take your time and make sure you find the perfect house. If your home buying criteria is very specific and you know that potential homes don’t come up very often, then buying first might be your only option. It’s a good idea to talk with your agent and review the frequency of past sales that match your home buying preferences.
If you decide to sell first, you’ll have the added benefit of knowing exactly how much money you have to spend on your next home and you won’t feel the same kind of pressure to sell quickly. You also won’t feel the added pressure to reduce your price if a quick sale doesn’t happen. In a balanced or buyer’s market, selling first is typically a smart choice but of course, there are plenty of other variables to consider.
Some homeowners might be afraid of being homeless should they sell first and not find something in time, but in reality, that rarely ever happens. A typical closing date on the sale of any home is between 60-90 days from the purchase date. For most, that is more than enough time to find a new home, but be honest with yourself, if you know you’ll be super picky, you’ll need to factor that into your decision.
You see, there is no right or wrong answers when it comes to buying or selling first, but there are many pros and cons to consider and it’s important that you understand them before making that decision. You should always discuss your options with your real estate agent and lender and make a smart decision based on your personal situation.