Should You Buy a New Home Before Selling Your Existing Property?
Should you Buy a New Home before selling your existing property?
You may already own an existing home, and wandering whether you should sell your home first before buying a new one or the reverse. Depending on your local market, as well as your financial and timeline circumstances, there is no definitive answer.
In the current Toronto Real Estate climate, we are in a strong seller's market. Inventory for new homes is at an all time low. For sellers it's a great time to sell. However, if you are looking for a new home, it may take longer than you anticipate to find the right property that fits your needs.
If you shop for a home first, your house hunting experience can be more relaxed without having to worry about the closing date looming for your existing home. However, once you make a purchase, the clock starts ticking towards the closing date for the new home. For existing home owners who need the equity of their existing home to buy their next one, you may end up feeling pressured when accepting an offer when selling your existing home that can impact your consideration on price and terms. You may also find yourself owning two homes at once for the transitioning period, two mortgages, and carrying costs to maintain both homes.
The benefit to selling first is knowing how much money you will have to work with, which will also help you determine the hard numbers for how much you want to spend for the next home. However, when the clock starts ticking on the closing of your current home, you may feel pressured to shop for a place that compromises the price and your needs. Not finding a new home before your existing home closes, you can end up not having a place to live, or have to spend extra on renting accommodation until you find a permanent home.
In an ideal world, the closing dates would align, but it is important to understand the risks and have a contingency plan in place if you find yourself in a "two home, or no home scenario".
I have worked with many move-up sellers who need to buy and sell simultaneously in a fast moving market. It is important to sit down with an experience real estate professional to tailor real estate solution for you based on your needs and circumstances. If you are ready to have an open conversation about your next home search, feel free to contact me for a consultation appointment.
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