Home Sale Contingencies.. Do You Buy First Or Sell First?
We all know our local Denver Metro area Real Estate Market is HOT! It moves quickly and is a fierce competition, which begs the question: can you make a purchase contingent on selling your current home? The easy answer is yes BUT in order to do so you must have a STRONG game plan with back-up options and decide which of the following routes you prefer to take:
Do you want to list your current home first, get it under contract, and THEN put in an offer on a new home? Or...
Do you want to put in an offer on a new home contingent on putting current home on the market and accepting an offer?
There are pros and cons to each of them so let's evaluate them individually so you can decide which route you would personally prefer!
Listing Current Home First, Accepting Offer, and THEN Searching For a New Home:
Pros: The biggest upside to this option is that you already know your current home will sell because it's under contract AND your offer position on your future purchase looks much better (less risky) to the seller of your new purchase since it takes the risk out of wondering if your home will sit on the market for a long time, which would hold up their sale. Also, since it's under contract, you know where the transaction sits financially, which can help determine the amount you can purchase for your new home. You also have the time to get your home fully prepared to put on the market.
Cons: With this method, it's difficult to be super choosy because you will want to find a new home fairly quickly, within 2-3 weeks.
Who it is best for: This timeline of events is best for people who know 100% they want or need to move and want to do it rather quickly.
Submit Offer, Get Under Contract, and THEN List Current Home:
Pros: You can take your time in looking for your next home and be a little more picky in what you would like to submit an offer on. It's not quite as much of a rush to find a new home.
Cons: With this method, you risk getting beat out in multiple offer situations because the seller will have to wait for you to list your home, accept an offer, etc. and it becomes more tricky relying on additional factors/people and the added timing. It's also more of a rush to get the current home on the market making that timeframe more stressful.
Who it is best for: This works better for people who are looking for a very specific type of home requiring a more lengthy home search as well as who currently live in a very marketable home that will definitely sell quickly.
There are many additional factors that go into deciding which route will be the best for you besides the ones listed above such as:
Will your home sell quickly?
How do you plan to price your home?
And of course, are you going to hire a phenomenal competitive agent who will work tirelessly for you in order to get you to the finish line for both selling and buying?
It's not easy to buy and sell at the same time but it can absolutely be done, just ask my clients who I have helped through both transactions!
If you would like to chat with me about which option would be best for you and your individual scenario, please don't hesitate to reach out to me! I love helping make real estate moves a fun, stress-free, and enjoyable experience!