You are planning to sell your property and a new one is on the market... Now you will have to decide whether to buy and sell simultaneously, or to find the better sequence. Here are some points to help you make up your mind.
Option 1: Sell first
If you decide to first sell your property, this will avoid unnecessary hassle over not finding a buyer in the proper time frame. It also encompasses the fact of not paying the bills for two properties. The amount received from selling will and might be useful to finance the next one. However, before (or during) the acquisition process for a new real estate product, you will have to already plan a temporary place to live and stock your belongings, hoping that the intermediary period between the sale and the new purchase is as short as possible.
Usually, as from the signature of the sale agreement, going through the 10-day period whereby the buyer can change his mind, to the time required for a housing loan, you may already foresee at least a three-month waiting period. No need to hurry and better use this time span to buy your new home.
Option 2: Buy first
If you are opting for less risk management ahead, in case your selling deal is postponed, then buying your next property is the solution. If your purchase you next property first, the transition period and the house-moving process become less hectic. You can be at home again very quickly and this free partially your mind from the burden of the acquisition procedures. You will be provided with more time to manage things in case of delay as you will still have a place to stay.
However, as you will not be able to always forecast the selling price—and the time needed to settle the deal—, your future investment may be at stake. You may also have extra expenses for the maintenance of your house on sale.
Between buying and selling first, there is of course no right formula. Your prerogatives will lead your choice. Just keep in mind that planning your real estate project must include your personal and financial context as well as the state of the property market.
