Home Selling and Buying Together
Are you thinking of home selling and buying at the same time. You know, selling your current house now while interest rates are so wonderfully low before they head up even more than they've already gone?
Then you can buy a new home and maybe even pay the same price for a bigger house? Or perhaps it's downsizing you're after? Maybe even one of the lovely senior retirement homes that abound in Roseville for boomers and seniors?Then you might actually be paying less per month! BUT you've heard the market is tight and homes are hard to find! What to do?
Home Selling and Buying Issues
It's true! The market IS tight. I talked to a gentleman in Trader Joe's on Douglas today in Roseville and he said he's seeing homes popping up with for sale signs all over the place. I am, too. The only problem is, I'm also seeing them go pending right away as well (pending is one of our real estate words that means the house has received an offer, they're going through escrow, but it's not final til it's closed).
As I explained to him, “Yup, there ARE a lot of homes going up for sale each day. But there are even more new buyers looking each day. And many of them go pending right away but not all real estate agents put a “pending” sign up. Zillow is infamous for not being up-to-date. So only real estate agents who have access to the MLS along with our home selling and buying clients who are getting our MLS “drip” emails realize how fast that is happening.”
The concern of many home sellers is that they will sell their home and not be able to find a new one to move into. That could happen. But, depending on the price range and the amount of equity you have in your current home, you hopefully will be able to find something that is just right for your needs. The timing may be tricky, of course. But that can be true for many worthwhile things.
Real Estate Options
Here are some “thinking outside the box” home selling options that might work for you:
- Right now, escrows are fast-tracking at about 30 days or faster. Some buyers love that, others really need more time. Put your house on the market and start looking for your new home. Offer any buyers a longer escrow – thus giving you extra time to find your home as well. And while you're househunting, do the opposite. Come in hard and fast with a GREAT offer right off the bat. Get the new house you want ahead of other buyers to give you a nice cushion between the two sales.
- Check out all the brand new homes being built in our area. Be sure to take your own REALTOR with with you. The sales representatives in the office are great but their primary concern is for their builder. You want to be sure you have someone there with YOUR interests top of mind. And yes! I'd love to help you with that! The nice thing about new homes is that you can often pick out your new home lot that may be planned for a few months out, which should give you ample time to sell your current home. Most builders are good at working with you on that. You just have to watch the timing on the two closings. 🙂
- Use this as a time to REALLY get serious about weeding out big time! Sell, give away, and throw away ruthlessly. Then put most of what's left in a storage unit and be open to moving into an apartment for 2-6 months. Your house will most likely sell even faster as it will look so spiffy. Once escrow closes, if you haven't found or closed on your lovely new home, move into the apartment on a short-term lease. Yes, it's a bit of a headache. But it's also a great way to weed out AND to lose weight. (Moving is HARD work. 😉 ) BE CAREFUL about the apartment you choose – most will charge more per month for the 6 month lease than the 12. Even more if you take a 2-4 month lease. And one Roseville apartment manger I talked to a year or so ago charged almost DOUBLE! So do call around.
- Sell your home contingent on finding and getting into escrow on your next home. We're seeing this more and more. This can be very frustrating to buyers, though, as it makes it hard for them to plan. They have to pay cash up front for inspections in the first 17 or so days and that's money down the drain if you cancel due to not finding something quickly enough. Even if they're willing to consider it, most will realize they might miss something good, if they go into escrow with you and then you cancel. Thus, you will generally have a smaller pool of buyers and probably a lower quality of buyers, as well. You may still be able to sell but your profit might not be quite as high, thus lowering your purchasing power for your next home.
- BUY your home contingent on selling your house. THEN put your house on the market. To be honest, in this seller's market that's probably not going to go over very well with sellers. BUT if you found a great home to buy that might be a bit overpriced and has been sitting on the market for an overlong period of time, you might try offering full price contingent on selling your house AND contingent on the new house appraising for the price your are offering OR they are to accept the appraisal price. THAT might get your offer accepted and give you the breathing room you need.
- If you can afford it, or if a bridge loan or other type of short-term loan is an option, buy first, then sell. THAT gives you the sweet option of moving out before putting your home on the market and not having to deal with all the headaches of showing your house on a moment's notice. Plus you'll know exactly how much you will have to spend on your next home – whether you are moving up or downsizing. I have to admit, that was MY favorite way to go on the times I was able to do so.
- Start house hunting to buy your new house with the plan to rent your current house for the first year. If your current home is in nice condition, you can probably rent it fairly quickly. Thus you have more time and flexibility to find and buy your home. And at the end of the one year lease, you can then fix up the house after it is vacated and put it on the market to sell. On the plus side, you should talk to the IRS as well as your tax person or accountant as rentals may offer great tax deductions. And you have (at this moment – and still CHECK WITH YOUR ACCOUNTANT TO VERIFY) a period of 3 out of 5(?) years that you can rent without losing your capital gains cushion. That's a big help! Of course, there are some downsides to this as well. The tenants may not leave it in as great of shape, thus requiring time and/or money to fix it up or a lower asking price when you are ready to sell the house. It might not rent right away or the tenants might leave unexpectedly early. Fairly rare, but it can happen.
Home Selling and Buying Made Easier for YOU
As you can tell, there are a lot of home selling and buying options. Only you know what you are comfortable doing. And there is no perfect solution. But I'd love to help you sort through what's available and help you through all the issues as you sell your home and buy a new-to-you or even brand new construction home for your sweet season of life. My goal is to make the job easier for you! Give me a buzz at 916-768-0127 or email me at [email protected] I look forward to helping you with your real estate needs. 🙂