
Deciding whether to sell your current home before buying your next one is a common dilemma for homeowners. Both approaches have their advantages and challenges. Therefore, understanding your options is crucial to making the right choice. Below, we break down the pros and cons of each approach to help you decide.
Selling First: Pros and Cons
Pros of Selling First:
- Know Your Budget
By selling first, you’ll have a clear understanding of your financial position. As a result, this reduces uncertainty and ensures you don’t overextend your budget. - No Risk of Carrying Two Mortgages
Selling first eliminates the financial stress of paying for two properties simultaneously. In contrast, buying first might create financial pressure if your current home doesn’t sell quickly. - Stronger Negotiation Position
As a buyer, you’ll likely have more leverage because your funds will already be in hand. Therefore, sellers are more likely to accept your offer.
Cons of Selling First:
- Temporary Living Arrangements
If you can’t find your next home quickly, you may need to rent or stay with family. Consequently, this can add unexpected costs and disruptions. - Pressure to Buy Quickly
Selling first creates a sense of urgency to find your next property. As a result, you might feel pressured to compromise on your ideal home.
Buying First: Pros and Cons
Pros of Buying First:
- You’re Not Rushed
Buying first gives you the freedom to find the perfect home. For instance, you can take your time exploring options without the pressure of needing to move out quickly. - Smooth Transition
By buying first, you can avoid the hassle of temporary living arrangements. This means you can move seamlessly from one home to the next.
Cons of Buying First:
- Financial Risk
If your current home takes longer to sell, you may end up carrying two mortgages. Therefore, it’s important to be financially prepared for this scenario. (need to speak to someone about finances? head to Rita Sauvage for the best finance guidance for when buying or selling you can email here at hello.rita@kellyandcofinance.com.au or call her on 0409 852 252 Kelly & Co ) - Market Uncertainty
In a fluctuating market, you might not get the price you expect for your current home. As a result, this could affect your budget for the new property. - Contingent Offers Are Less Attractive
Sellers may view your offer as less appealing if it’s contingent on selling your current home. Consequently, you may face more competition from other buyers.
Factors to Consider When Deciding
- Current Market Conditions
Is it a buyer’s or seller’s market? For example, in a seller’s market, your home may sell quickly, making it safer to buy first. However, in a buyer’s market, selling first might be the better choice. - Your Financial Position
Can you afford two mortgages temporarily? If not, selling first might be the safer option. - Your Risk Tolerance
Are you comfortable with uncertainty, or do you prefer a secure process? For instance, selling first offers more predictability. - Settlement Timing
Flexible settlement terms, such as a rent-back agreement, can help bridge the gap. Therefore, negotiating these terms may help you achieve a smoother transition.
What’s the Best Option for You?
There’s no one-size-fits-all answer, but the good news is that you don’t have to make this decision alone. At Shawn & Kym Real Estate, we work closely with homeowners to tailor a strategy that fits their needs. Whether you choose to sell first or buy first, our expertise ensures you’ll have the guidance you need.
Ready to Decide? Let’s Chat!
If you’re thinking of selling, buying, or both, we’re here to help. Contact us today for a free property appraisal and personalized advice to make your real estate journey stress-free and successful.
Call us on 0411 532 333 or email shawn@shawnandkym.com.au
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