Reasons to Buy First and Then Sell
- It's a Seller's Market.
When the number of buyers are many and inventory is reduced, homes generally sell within days of hitting the market. In this instance, there is little risk in buying first and selling second. However, few sellers will accept a contingent offer. Since these sellers will not accept a sale-contingent offer, you could be stuck owning two residences until your home sells. On top of that, you will pay top dollar for your new home, especially if you end up bidding in a multiple offer situation.
- Deal is Too Good to Wait.
Sometimes, regardless of the marketplace, a home will come on the market at a price that is too good to pass up. Perhaps the sellers are getting divorced, need to pay medical bills or one of them has a gambling addiction with debts to pay; the point is the sellers are extremely motivated to sell. Before word spreads across town, you might want to be the first offer on the table.
In this instance, it makes sense to buy before you sell because the money you make walking into the deal is worth making double payments until your home sells. When the deal is that good, pull out all your negotiating tricks.
- It's Your Dream Home.
This is an emotional decision. As much as many buyers might want to be logical and analytical, people who let their hearts rule are not. Real estate is an emotional business anyway, so those who fixate on owning a certain type of home may as well buy it when they first spot it. For some, money is no object. Fortunately, these types of buyers rarely look back, but keep their sights set on the horizon, on moving forward, and they don't regret making emotional decisions. They want what they want, and they get what they want.
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At the time of writing, Elizabeth Weintraub, DRE # 00697006, is a Broker-Associate at Lyon Real Estate in Sacramento, California.