Should You Sell First or Buy First?
In an ideal scenario, selling your current home before purchasing your next one puts you in the strongest position. Once your home is sold, you know exactly what budget you’re working with, your financing is clearer, and you can make offers without conditions tied to selling your property. Sellers are often more receptive to these “clean” offers, which can mean better negotiating power and fewer complications.That said, many homeowners hesitate to sell before they’ve found the right next home. The fear of being rushed into a purchase or having nowhere to go is very real. Fortunately, there are ways to line up both transactions successfully, as long as you understand the market and your options.
Why Market Conditions Matter
The current real estate market plays a major role in deciding whether it’s safer to buy first or sell first. In a strong seller’s market, homes tend to sell quickly, which can reduce the risk of purchasing before selling. In a buyer’s market, however, selling can take longer, making it riskier to commit to a purchase without first securing the funds from your sale.This is where professional guidance is essential. Working closely with an experienced real estate agent and a trusted mortgage broker or financial advisor ensures everyone is aligned on timelines, affordability, and potential financing solutions.
Tips for Buying and Selling at the Same Time
If you’re planning to buy and sell simultaneously, here are some key strategies to keep everything on track:- Get your finances sorted early. Before starting the process, make sure you have a clear understanding of what you can afford. A mortgage broker can also explain options like bridge financing if your sale and purchase dates don’t line up perfectly.
- Prepare your home in advance. If you’re considering buying first with a condition to sell, having your home ready for photos, marketing, and listing will save valuable time.
- Consider selling first with a longer completion date. This approach is often the least stressful. Selling first gives you certainty around your budget, and a longer completion date allows time to find the right next home.
- Buying first comes with added risk. If you fall in love with a home and decide to purchase before selling, your offer may include a “subject-to-sale” clause. These offers can be less attractive to sellers and may include time clauses that allow another buyer to step in, even after you’ve begun preparing your home for sale.
Focus on the Price Gap
One of the most important things to keep in mind when buying and selling in the same market is the price gap between homes. If market conditions mean you accept less for your current home, you’re also likely paying less for your next one, depending on location and property type. Waiting to sell in a hot market may mean a higher sale price, but it can also result in more competition and higher purchase prices on the buying side.The Best Overall Strategy
In most cases, selling first and negotiating a longer completion date provides the most flexibility and peace of mind. It allows you to shop as a confident, ready-to-go buyer, often with more negotiating power than buyers who are subject to selling their own home.Buying and selling at the same time doesn’t have to be complicated. By understanding your options, planning ahead, and working with professionals who know how to protect your interests, you can move forward with confidence and significantly reduce the stress of the process.
