Selling your old home and buying a new one at the same time is a balancing act. That said, it can be done.
Buying a new home before you sell your old one is, honestly, the trickier of the two methods. While it is not impossible, it does require a bit more financial finagling. Sometimes, though, you find your dream home early on in your search. If that happens to you, consider some options.
You can make your offer based on the contingency of your home selling. This contingency allows you time to find a buyer for your old house before you move forward with settling on your new home. If you cannot find a buyer in time, you have the option to try to extend the contract or to back out of the deal.
Are you able to afford both properties? Holding two properties at the same time will undoubtedly be a stretch financially. However, if you can afford to do so, it is also the safest option. This option allows you to submit offers on new homes without having to worry about using a home sale contingency or taking out a new loan.
What if you sell before you buy? Selling your old home before you buy a new one is a more financially secure option. This way, you will know exactly how much money you have to spend on a new property. However, this method is not without its inconveniences, as well. For instance, you may have to deal with the stress of moving twice within a short period of time.
What if none of these options work for you and you need to coordinate the closing of both properties on the same day? If you are like most people, you have accumulated many years of stuff in your home and moving out the same day the buyers move in is nearly impossible. Consult with your REALTOR® and ask about pre-occupancy and post-occupancy; these terms define themselves.
Is it possible that the home you are buying is vacant? If so, then you can ask to move in early, this is known as pre-occupancy. This can alleviate the hassle of moving twice. If the seller is agreeing to pre-occupancy, you may have to pay a “rental fee” for the days you occupy. You are also responsible for insurance and utilities for the property. Post occupancy means that you remain in your property for a period until you can move into your new home. You may also end up paying a fee to the new buyer for staying the extended time. This allows you more time to move and prepare your home for the buyer.
Moving is not the only thing you need to consider when vacating your home. You need to get all utilities switched out of your name, schedule your insurance to be cancelled after you close, and clean your home so it is ready for the new buyer. It can be stressful but that is why we recommend using a REALTOR®. They can guide you from the beginning to the end.
Have a great week and remember to do good things!
Stephanie Lemley, 2021 MBOR President