Figure out whether buying or selling first is right for you.
Making a move in real estate can feel daunting. And for those who already own property, the question of whether to buy or sell first isn’t always a simple one. It depends on lots of different factors, including market conditions, your financial situation, your personal circumstances, and your timeline for making a move.
So, let’s take a look at each of these factors so you can make a decision that suits where you are in life.
Listen to the market
One of the most important factors to consider when making this decision is the current market conditions.
In a seller’s market, where there is high demand for homes and low inventory, it may be beneficial to sell your current home first. This will allow you to take advantage of the high demand and potentially get a good price for your home.
On the other hand, in a buyer’s market, where there is low demand for homes and high inventory, it may be more advantageous to buy first. This would allow you to take advantage of lower interest rates, and potentially get a good deal on your next home.
Think about your finances
A consideration that hits a little closer to home is your personal financial situation.
If you have enough savings or equity in your current home, you may be able to afford to buy and sell simultaneously. To do so you’d need a ‘bridging loan’, which allows you to purchase a new home before selling your current home.
However, if you do not have enough savings or equity, it may be more beneficial to sell your current home first. That way you’ll be able to use the proceeds as a down payment for your next home.
Look at your situation
Selling and buying property isn’t just a practical decision; it’s also a personal one. When deciding which step to take first, it’s important to consider your long-term goals and what type of property you’re looking for, as well as your personal situation and needs.
For example, if you’re looking to upgrade to a bigger home, or move to a different area with better schools or job opportunities, it may be beneficial to buy first. On the other hand, if you’re downsizing or looking to move to a less expensive area, it may be more beneficial to sell first.
Consider your timeline
Your timeline for making a move is also an important consideration when deciding whether to buy or sell first. It’s important to recognise how quickly you need or want to move, and be able to plan accordingly.
If you need to move quickly, it may be best to sell your home first, as the buying process can take longer. This way you can use the proceeds from the sale to purchase a new home without the added pressure of a tight deadline.
On the other hand, if you have more time, you can wait for the right opportunity to buy or sell – whether it’s finding the perfect new home or waiting for a better market condition to sell your current one.
Make the move that’s right for you
At the end of the day, the choice of whether to buy or sell a property first is both practical and personal. This kind of decision isn’t a ‘one size fits all’ situation. The right move will depend on your unique situation.
You’ll need to balance market conditions, your financial situation, your short-term needs and long-term goals, and your moving timeline. But by taking the time to understand your options and carefully weigh the pros and cons, you can make the decision that’s best for you and your family.