Unless you’ve been living under a rock for the past 12 months you’re well aware the U.S. is experiencing an extremely strong seller’s market. That is great for sellers, except for the fact that the majority of those sellers are also buyers. The truth is that the process of selling and buying can be a bit tricky. That’s why you need to be prepared, have a solid game plan, and have a good team to help you before you get started.
The traditional method
This is still the best way to go if you don’t want to take out extra loans or have to carry two mortgages. However, in a tough market like this one, you have to be a little more creative and flexible if you want to get this done. First, make sure you find the right real estate agent in your area who knows the market extremely well. This agent will be able to position your home on the market properly to get it sold in the shortest amount of time. Before you even go out looking at any houses you’re interested in buying, you will want to have your current home under contract. As most know, in this market, offers with sale contingencies are less likely to be accepted. But if you have the home under contract already and are maybe even through the due diligence period with your buyer, a seller will be more inclined to consider your offer.
Another option that falls in this same traditional category is new construction. Some new construction builders will give longer sale contingencies to buyers, especially if the home isn’t built yet. In some cases, these contingencies can be as long as 60 days. Keep this option open as well.
The following methods are far more convenient for sellers, but that convenience comes with a price. Some people in this position may obtain a bridge loan or HELOC to get the job done without having to sell and buy at the same time. Both of these options will cost more than the traditional method and use some of the equity you’ve built in your current home. However, they may be necessary in order to compete in a strong seller’s market. On the buy-side you’ll be bidding against many other buyers who will not be adding sale contingencies in their offers. The best thing you can do in these selling and buying situations is to be prepared well in advance of putting your home on the market. Make sure you know what all of your options are. Talk to several lenders and financial advisors to get a game plan together that works best for you and puts you in the most advantageous position when it comes time to make an offer on your next home. Selling and buying can be tricky. But with the right team and plan of action, you’re sure to succeed.