Pros and Cons of Buying a House before Selling Your Old One
So, you found your perfect house. Great! It’s everything you always wanted in a home…. fabulous location in a good neighborhood, finished basement, beautiful yard, the right school for your kids ….. it’s the house of your dreams!
The only problem is you already own a house. With a mortgage. You hadn’t planned on moving so your home is not ready to be listed on the market. What should you do?
I think it mainly comes down to finances. Can you afford to pay two mortgages? What if your old house doesn’t sell for 8 months? Can you still afford both mortgage payments? The market is unpredictable. You may have a great house in a good location but keep in mind, there are no guarantees. Just because the house next door sold within a week, does not mean that your home will.
Are There Advantages to Buying a House Before Selling the Old One?
Absolutely! If you can afford to pay for both houses, buying a home before selling the old one may not be a bad idea. The obvious advantage is that you get to buy your dream home. It didn’t slip away while you were busy fixing up the old house to sell.
Also, you can take your time getting the old house ready for the market. Or, you can stay in the old place while you are redecorating the new one. Pretty convenient, really.
Assess your risk
The house you found may be the one you’ve always dreamed of owning but it can quickly turn into a nightmare. Before jumping into the frying pan, make a very careful risk assessment of your finances. And just because a lender is willing to let you borrow the money, does not mean that you can realistically afford it! Remember all the foreclosures a few years ago? Exactly.
What About A Contingency Offer?
A Contingency Offer is when you submit an offer on a home contingent on the sale of your house. In other words, if your house does not sell, you can get out of buying the other one. Sounds great, right? The problem with it is that many home sellers won’t entertain contingency offers. They don’t want to put the sale of their house on hold while waiting for yours to sell. Understandable.
Bottom line…whether or not you should buy a new house before selling your old one is really up to you but honestly, is probably not a great idea for most people. Do your homework and don’t make this huge decision lightly or quickly.
Should you buy a house now? I would be happy to sit down and discuss your options with you.
Call me anytime,
Bruce Moore, Realtor
ABR – Specialist in working with Home buyers.
E-Pro – Specialist in using the latest Technology to help buyers find and buy their dream home.
IRES – International Real Estate Specialist
(Image courtesy of Gualberto107 / FreeDigitalPhotos.net)