Buying or Selling First?

Should You Sell Your Home Before You Buy a New One?

When you’re ready to make a move, one of the biggest decisions you’ll face is whether to sell your current home before buying your next one. It’s a bit like the classic “chicken or the egg” question; there’s no one-size-fits-all answer, but there are pros and cons to consider for each approach.

The Benefits of Selling First

Selling your home before buying can make the process feel more straightforward. You’ll know exactly how much you’ve made from the sale, which can help you set a realistic budget for your new place. It also means you won’t be juggling two mortgages at once, which can take a lot of pressure off your finances.

From a negotiating standpoint, buyers without a home to sell are often seen as more appealing. Without a contingent offer, you can move faster when the right home pops up.

The main downside? You’ll need somewhere to live in between. That might mean staying with family, finding a short-term rental, or moving twice, none of which are ideal, but they can be worth it for the peace of mind that comes with selling first.

The Benefits of Buying First

On the flip side, buying your new home before selling your old one ensures you won’t have to deal with temporary housing or rushed decisions. You can take your time finding the right home and make the move just once.

However, this approach can be tricky financially. You may need to qualify for two mortgages at the same time or rely on a bridge loan to cover the gap until your current home sells. There’s also the risk that your home might take longer to sell than expected, leaving you carrying two sets of bills.

How to Decide What’s Right for You

The choice often comes down to your finances, your local housing market, and your risk tolerance.

• In a seller’s market (where homes sell quickly), buying first can be less risky since your current home is likely to sell fast.
  
  

• In a buyer’s market (where homes take longer to sell), selling first can help avoid the burden of two mortgages.
  
  

• If you need the equity from your current home to buy your next one, selling first is usually the smarter move.

In the end, the “right” answer is the one that minimizes your stress while keeping your finances healthy. Talk to your real estate agent about the current market conditions in your area and your options for timing the transition. With the right strategy, you can make your next move without losing sleep or money along the way.