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SELL FIRST |
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Pros: |
Cons: |
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You know exactly how much money you
have from the sale of your first home and can comfortably
choose your next home's price range and negotiate accordingly.
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With cash in hand you can immediately
make firm offers on any property that meets your needs.
If a property pops up that is perfect or extremely well
priced you can be the first in the door with an offer.
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You have more negotiating power.
When Sellers turn down or counter an offer that is conditional
upon the sale of a home, they usually believe that the
Buyer will come back with a more serious offer if and
when the Buyers' home has finally sold. Sellers give
much more consideration to unconditional offers since
they usually realize the Buyer does have other options
and may move on and pursue a different property if their
final offer is rejected.
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If more than one property interests
you, you can shop around, negotiate, and finally settle
on the best deal. |
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If the right home is not currently
on the market when you finally sell, and nothing comes
up before your closing date, you may have to find alternative
accommodation until something appropriate comes along.
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Questions
you should ask yourself |
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Do you have reasonable options available
if your closing dates do not line up and you cannot
move into your new home the same day you move out of
your current home?
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How would you and your family react
to the stress of having to rent for an unknown period
of time? |
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BUY FIRST |
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Pros: |
Cons: |
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If you are only interested in moving
if a very specific property comes up, buying first ensures
you do not miss out on the perfect opportunity.
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If a unique or underpriced property
comes on the market and you do not think it will last
long, snapping up the deal ensures someone else does
not buy it out from under you.
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If your current home does not sell
quickly enough you may end up having to finance both
homes and carry the extra debt until you do sell.
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You do not know what the final selling
price of your current home will be. If your budget is
tight, this could affect your financial decisions. While
you can get appraisals and market evaluations of your
current home's value, nothing is for sure until you
actually get an offer. |
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Questions you should ask
yourself |
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How would you react to the stress
of owning two homes at once?
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Would you have the financial reserves
to do this?
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How would you feel if you were eventually
forced to sell your current home at a "fire sale" price? |
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CONDITIONAL OFFERS |
| A third option involves making
your offer to purchase conditional upon your being able
to sell your current home within a specified time period.
Conditional offers usually include a clause that allows
the Seller to continue to market his or her property while
you try to sell your home. If the Seller receives another
bona fide offer, they can accept it and ask you either to
remove your condition and firm up or to step aside. While
conditional offers do not provide all of the advantages
of the first two options, they do offer a reasonable compromise
for those uncomfortable with the drawbacks associated with
either selling or buying first. |
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Pros: |
Cons: |
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You do not have to sell your current
home until you have found and negotiated an acceptable
price on your next home. |
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You have less negotiating power.
Sellers sometimes turn down or counter an offer that
is conditional upon the sale of a home. There is a general
impression that Sellers give less consideration to conditional
offers than they do to firm ones. Some Sellers feel
that the Buyer will come back with a more serious offer
if and when their current home has finally sold. You
may end up having to pay a bit more for the house in
order to get your conditional offer accepted and be
first in line.
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Another purchaser may make an offer
and bump your offer before you have sold your current
home, putting you back at square one.
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You cannot withdraw your conditional
offer until the time set out in the condition has passed.
This could be frustrating if a better deal comes along
and you wish to pursue it. |
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Great Beginnings start
