Can I Buy an Orange County, CA House before I Sell Mine?
When it’s time to buy a new home because you need a bigger one or a smaller one, do you want to make sure you have a new one before you sell your old one?
Most people do! They don’t like the idea of selling their home before knowing where they are going to go next, and I don’t blame them!
There is just one problem with this plan.
Depending on the current status of the housing market, a seller might not accept your offer on your new home until you have already sold your old home.
Are you starting to see the chicken and the egg problem? You can’t buy your new home until you have sold your old home, and you don’t want to sell your old home until you have a new home to move into.
What can you do?
First talk to a real estate professional and find out what kind of a market it is. Is it a buyer’s market or a seller’s market?
Buyer’s Market
If it is a buyer’s market, the seller for your new home is more likely to take an offer subject to you selling your old home though they may be concerned because they know it may take you awhile.
In this case, you may be able to get an offer accepted by the seller that will allow you to sell your own home. To make your offer most acceptable, you should have already listed your property for sale so that you can show the seller your trying to sell.
If you’re not willing to put your home up for sale, why should they accept your offer?
Seller’s Market
This is when it becomes a little more fun (please note sarcasm) to buy your next house. In a time when there is limited inventory and many buyers, why would a seller want to take their home off the market and wait to see if you can sell your home?
This can be a very difficult proposition especially when the seller’s agent is likely telling them it would be smarter to take another offer.
So, what can you do in a seller’s market to buy your next home?
- See if you qualify to own two homes at the same time
- Perhaps your income allows you to qualify for two mortgages at the same time, and you don’t have to sell in order to buy. In this case, you may just buy the second home and then pay the first.
- There is risk to this as you may end up paying two mortgages for an unknown period of time unless you plan to keep the first home and rent it out.
- Sell your house subject to locating your new home
- This means that the buyer agrees to wait to close on their purchase until you find your new home.
- This works best when the buyer is not in a hurry to have their new home.
- This may make your potential seller more comfortable accepting your offer as your home is already in escrow.
- The downside to this is that it may make your home less desirable to some buyers.
- Sell your house and rent it back from your buyer
- This option allows you to buy your next home with no contingencies for the sale of your current home and makes you a much stronger buyer
- It is optimal for you though it requires finding a buyer who is willing to be flexible on their move in date.
- A buyer is unlikely to allow you more than a month or two, if that. So you do need to aggressively look for your next home.
- Be willing to move to an interim home between the sale of your current home and the purchase of your next
- This is the option that most seller/buyer would prefer to avoid though it is definitely an option.
- It requires the expense and hassle of moving twice though it will allow you to appeal to the most number of buyers as they don’t have to wait for anything, and it appeals to the most sellers because you have no contingencies.
What is your first step when you need/want to sell your current home and buy your next. Meet with a real estate professional to find out the status of the current market and what she recommends to help you move in to your next home. Your second step will likely be to meet with a lender unless the sale of your old home will allow you to purchase your new home in cash.
Would you like to know the status of the Orange County market and the best way to get in to your new home? Please give Christine Donovan a call at 714-319-9751.