How to Buy a New Home When You Need to Sell Your Current One

Buying a new home is exciting, but when you need to sell your current home first, it can feel like a high-stakes juggling act. With the right approach and strategy, though, you can make a smooth transition between homes. Here’s how to navigate the process.

1. Evaluate Your Finances

Before you start, take a close look at your financial situation. Determine how much equity you have in your current home and how that could impact your next purchase. Your real estate agent and lender can help you estimate how much you could expect to walk away with after selling, which is essential to plan your budget for the new home.

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2. Decide on a Strategy: Sell First or Buy First?

There are pros and cons to each approach. Selling first might be less stressful financially, as you won’t have two mortgages, but it also means you may need to find temporary housing. Buying first can help you secure your ideal new home, but you might face pressure to sell quickly. Here’s a breakdown:

• Sell First: Selling first gives you a clear idea of your buying power. With no mortgage on your current home, lenders will see you as less risky. You may need temporary housing if you can’t close on a new home right away, but you’ll likely have less pressure overall.

• Buy First: Buying first can be ideal if you’re in a competitive market where homes sell fast. With this approach, however, you may need a contingency plan in case your current home takes longer to sell.

3. Consider a Home Sale Contingency 

A home sale contingency allows you to place an offer on a new home with the understanding that you’ll only proceed if your current home sells. While some sellers may be hesitant to accept this type of offer, it’s a reasonable option in a slower market where sellers may be more willing to negotiate. While not required, it is recommended that your current home be either active on the market, or better yet, under contract.  This gives sellers more confidence in accepting your offer.  

4. Prepare Your Home for Sale in Advance

If you’re planning to buy and sell simultaneously, the goal is to have your current home ready to list the moment you find your new one. Start by working with a real estate agent to:

• Complete any necessary repairs or updates

• Stage your home to appeal to buyers

• Price it competitively based on current market conditions in your area

Having your home ready to go live on the market will help you move faster when you find a new property.

5. Stay Organized and Flexible

Flexibility is essential. Real estate transactions are unpredictable, so be ready to adjust your timeline or expectations if necessary. Your real estate agent can help keep everything on track by coordinating between buyers, sellers, and lenders to meet closing deadlines and manage potential roadblocks.

6. Work with an Experienced Real Estate Agent

A real estate agent who understands the intricacies of buying and selling simultaneously will be invaluable. They’ll help you:

• Time your transactions

• Craft attractive offers

• Negotiate contingencies and rent-back agreements

• Market your home effectively

In the world of real estate, experience counts. An agent who knows your local market well will make the process smoother and help ensure you get the best possible results.

Final Thoughts

Transitioning from one home to another doesn’t have to be overwhelming. With good planning, the right strategy, and an experienced real estate agent by your side, you can make the move seamless and stress-free. Remember, buying and selling together may come with added complexity, but it also opens up exciting new possibilities. With patience and preparation, you’ll soon be unpacking in your new home—ready to enjoy the next chapter of your life.