Bought elsewhere, must sell
Some people seem to have a natural attraction to that special situation called “a rock and a hard place”. Others are nimble market navigators who avoid difficult conditions. The later usually take the time to be informed, seek good advice from trustworthy sources and map a course for the best result.
People who buy before they have sold turn themselves into a “must-sell frustrated vendor” by choice. Anyone forced to sell rapidly is at the mercy of the market. In about 85% of the cases the result is acceptable enough for the seller. The other 15% suffer badly.
Unfortunately the confronting consequences of having to sell ASAP often only dawns on the unprepared homeowner once they have committed themselves to buy elsewhere.
Telling yourself that you will ‘just rent it out if you don’t get you price’ seems practical at first. That’s until you work out that you are paying a mortgage rate of 5% on a property that returns 3% in net rental income!
It’s a better result than a fire sale, but it is a situation better to avoid altogether. It is best to write up a plan prior to buying or selling. Work out time lines, house preparations, which selling agent you will use, solicitors, photos, financier and building inspectors. Interview agents well before you need their services.
You can buy yourself a lot of time by being prepared in advance. Once you are committed to a contract to buy, the clock runs down quickly.
Most homeowners who buy before they sell, do so for two reasons: they have excess confidence that their home will sell quickly and well, and they fear they will be unable to find another suitable replacement home.
The answers to the following questions may help you decide what to do:
Would you rather rent because you sold your home for a high price? or would you prefer to sell your home for a bargain price just because you bought elsewhere and were forced into a quick sale.
Like all markets, the property market is prone to be unpredictable. Generally it is much easier and safer to find a home to buy quickly than it is to find a buyer at your desired price. We recommend that you aim to become a cash-ready buyer rather than a desperate buyer.
What seller wouldn’t talk to a cash buyer willing to pay a fair price?
It might also assist your situation to have a long settlement date in your sales agreement. This will give you some ‘breathing space’ to find another home.
We have a new edition of the popular book “Get the Highest Price for Your Property” available with our complements. Please call us anytime on 835-4321.
