Should you buy a new home before selling yours?
If you already own a home and you’re looking to move, the biggest dilemma involves timing. Do you buy your new dream home first and hope to sell your old home fast, or do you sell first and hope that a great property comes up on the market quickly?
“The decision to buy or sell first is all about which risk you prefer to take,” says Joe Richer, Registrar of the Real Estate Council of Ontario. “There is no wrong option, but each has benefits and consequences.”
Here are the pros and cons for each approach.
- Buying first – the pros: With no closing date on your current home, you can take your time shopping for the next place. Bids will also be less stressful, knowing that you have time to wait for the next opportunity if this one doesn’t work out.
- Buying first – the cons: If you can’t sell your home fast enough, you could end up paying two mortgages, not to mention all the other costs of home ownership. For this option, carefully decide if you can afford two homes at once for a period of time.
- Selling first – the pros: With your home sold, you will know how much money you brought in, which will help determine the budget for your new home.
- Selling first – the cons: Selling first puts you in a race against time. You may end up rushing the house hunting process and settling for a home that doesn’t meet all your criteria. You may also spend more because you feel pressured to close a deal.
A registered real estate professional can help you make an informed decision that will best suit your situation. For more information, visit www.reco.on.ca.