Planning to move and wondering whether to sell your current home before buying your next? It’s a common dilemma, and the best approach depends on your unique situation. That’s where an experienced real estate agent comes in. They can assess your local market, current trends, and individual needs to help you make an informed decision.
However, in many cases today, selling your current home first often puts you in a stronger position. Here’s a sneak peek at why that order typically works best:
The Advantages of Selling First
When you sell your home before buying another, you unlock several key benefits:
- Access Your Home Equity: Selling your current home allows you to access the equity you’ve built up. Given the appreciation in home prices over the past few years, this could be a significant amount. For example, data from Cotality (formerly CoreLogic) shows the average homeowner is sitting on $302,000 in equity today. This substantial sum can then be used for the down payment on your next house, or even enable you to buy your next home with cash, making your next move much easier financially.
- Avoid Juggling Two Mortgages: Buying a new home before selling your current one can lead to holding two mortgages simultaneously, even if only for a few months. This can quickly become expensive, especially if unexpected repairs or delays arise. Selling first eliminates this financial stress and allows you to move forward without the burden of double payments. As Ramsey Solutions puts it, “It’s best to sell your old home before buying a new one to avoid unnecessary risks and possible headaches.”
- Stronger Negotiating Position: When you make an offer on a new home after selling your current one, your offer is typically cleaner and more appealing to sellers. You won’t need to include a contingency that your offer is dependent on the sale of your existing home, which can make your offer stand out in competitive markets. Your agent can leverage this to position your offer as strongly as possible, increasing your chances of securing the home you desire.
One Thing to Consider
While selling first offers significant advantages, there’s a potential trade-off to keep in mind:
- Temporary Housing: After your house sells, you might need a short-term rental or a temporary place to stay with family until you can move into your next home. Your agent can help you navigate this by negotiating options like post-closing occupancy (where you rent the home from the buyer for a set period) or flexible closing dates to ensure a smoother transition.
Ready to Make Your Move?
In many situations, selling your home first provides not only clarity but also valuable options. It empowers you to buy your next home with more confidence, greater financial power, and less pressure.
If you’re considering a move but are unsure where to begin, let’s connect. We can discuss your potential home equity, timing considerations, and local market conditions to help you determine the best path forward.