99.9% of us start the move to a new home this way. You start imagining the new life in your new home. And having all the things your current home doesn't. But, here is the thing. Many people make so many mistakes that lead to headaches and the loss of money in the process. I wrote this article after getting a desperate call from a Seller/Buyer. This lady was about to lose her deposit because of one avoidable mistake. So, if you want to buy and sell at the same time, Great! But before you jump the gun, here are 5 mistakes you can avoid.
#1 Moving Without Planning Ahead
Owning your dream home is all that matters until things go south. You need to know exactly how buying and selling a home works. I know it's not sexy or fun. But there is no way around it if you care about improving your lifestyle. A million things can go wrong if you act without a plan. So here are a few of my recommendations:
1st Find out if you have to sell the home you live in or if you can afford two mortgage payments. For that, you need to get a mortgage pre-approval. The lender will check your debt-to-income ratio and determine if you have to sell your existing home or not.
2nd Figure out the moving expenses. Add a moving expenses budget as part of your closing costs.
3rd Plan for your temporary stay. What happens if you have to vacate your house and can't move to your new home? Moving to a rental property until your home is ready would be a great backup plan. Or make arrangements to stay with family or Friends for a little while until you can move.
#2 Not Hiring a Local Real Estate Agent
Working with a realtor is a must, especially if you want to buy and sell at the same time. A real estate agent (like me) can tell you how much you can sell the house for and how much you will make from the sale. This will give you a better idea of how much you can afford for your next home. We can help you understand the risks involved when buying and selling at the same time. We can guide you through the process and assess the hyperlocal real estate market well.
A. Not hiring an agent with dual transaction experience. I strongly advise hiring a realtor with experience in closing dual transactions. We are prepared to face any challenge that comes our way when buying and selling at the same time. We even partner with real estate attorneys to help with legal advice if needed.
#3 Avoid Rushing Into Things
If your home is already pending, and you found a new construction home you love, don't sign anything without having your realtor review it first. As real estate agents, we can inform you of the pros and cons of buying a new construction home. So, don't rush. Let us guide you and advise you when is the perfect time to buy your home once you accept an offer.
#4 Not Having a Contingency Plan
You must have a contingency plan to sell your house to buy your next home. Let's say you have an accepted offer for your home. And you went shopping, fell in love with a home, made an offer, and the seller accepted. But then the buyer for your home canceled during the inspection period. What happens then?! How can you buy without selling your house first?.... I see this too often. Before you go shopping, at least wait until after the inspection period is over. Know what risks are involved and how you can protect yourself. Especially if you are buying a new construction home. This leads me to the next avoidable mistake...
#5 Selling Your Home to a Builder Partner Company
If you must sell before you can buy. The builder may refer you to their Ibuyer partner. Buyers can make you a cash offer for your home with no contingencies, but the caveat is they will buy it at a discount. So you will be sharing the profits of your home with them. This option is not beneficial for you because of the extra fees, which are the same as a brokerage commission. Ibuyers offer you a lower-than-market-value for your home. Plus, in most cases, these companies will negotiate further after the inspection. After all, they try to get the property as cheaply as possible regardless of the condition.
If you are considering this route think of it this way. The builder is trying to sell you a house and the Ibuyer is trying to buy your home. Those are their goals. Things can get complicated if you change your mind because of high monthly payments. Or if the offer for your existing home doesn't make financial sense to you. So keep your eyes open and consult with your realtor.
Takeaway:
There you have 5 mistakes you can avoid when you buy and sell at the same time. Avoiding these mistakes will save you time, money, and unnecessary stress. So make a plan, hire a local real estate agent with experience, don't rush into things, and know the risks. Ohh... and be careful if you sell to an IBuyer.
Hire a Local REALTOR:
If you want to sell and buy your next home, fill out the form at the bottom of this article for a free consultation.
Thank you!
Thank you for visiting my blog. I hope you found a golden nugget of information. If you found this article helpful, share it with others.
My mission:
To guide, inform and inspire you to take the 1st step toward your best life. Buy or sell homes with confidence. -Jury Hernandez, Broker Associate
