We all know that this housing market can be challenging, especially for buyers. Although the market in Northern California has gradually started moving back towards a bit more balance, it still is a seller’s market in many communities. No one knows the challenges of being a buyer more than someone who’s trying to sell a home at the same time as they work to buy another.
But there are ways to walk this financial tightrope, as noted in a recent article on Yahoo Finance. Financial planners and real estate veterans offered a few good tips if you find yourself trying to buy while selling:
- Use your social network for temporary housing. People who need short-term housing after selling their home (and before landing the next one) are often able to turn to relatives or friends who may have a second home, a vacant rental unit, or even room in their home. It’s not ideal, but could be the bridge you need until you move into your next home.
- A bridge loan or home equity line of credit. Speaking of bridging, some financial advisors recommend a bridge loan, which allows homeowners to tap into the equity in their current home. Similarly, a home equity line of credit could help in this situation. With short-term financing, you may be able to buy your next home before selling your current one and you can pay off the bridge loan once your home sells.
- Contingent offers. Some buyers who find themselves trying to sell a home at the same time will put in a contingent offer with the purchase dependent on the sale of their current home. But that can make your offer less attractive, and in a seller’s market like this one sellers may pass on your offer in favor of one without such a contingency.
- Go with the market trend. It’s important to understand whether it’s easier to sell a home or buy one, and then do the hard part first. In a seller’s market, for example, that means finding that next home before selling your existing one. In the buyer’s market, the reverse is true.
- Work with an experienced REALTOR®. Never is it more important to have the help of a strong real estate professional than when you find yourself in the tricky buy-sell situation. A REALTOR® who has experience in these situations and can help you navigate through the process is worth their weight in gold.
It’s definitely not an easy task to buy a home while trying to sell another, but it can be done. By being flexible, doing some careful planning, and working with an experienced real estate professional, you may find yourself in that next home before you know it.