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How to buy a home when you need to sell yours first

Main Idaho Real Estate Insights

Buying a home in a sellers market when you have a home to sell requires a strategy.

Top 3 Scenarios to Buying a Home when you Need to Sell Your First

Let's get right to the point. The seller is going to take the best offer. The one that best meets their needs and motivation will be the offer they accept.  If you have a home to sell, your offer will seem less appealing, possibly. You have to prove to the seller that your home is going to sell in the time within your offer and contract. Does that make sense?  What the seller does not want is to take your offer and fins our later that your home did not sell and ergo their home will not closing as expected. This will kill their time line as they will now have to try to sell their home again.

The Best Scenario is your home is already sold!

Optimally, the seller would love to know that; although you need to sell, your home is already under contract. Your agent can include this in the offer which will include supporting documents that the buyer is solid. The buyer of your home is approved for a home loan, has a large down payment and there are not concerns to think your home will not close on time.

Your Home is listed for sale on the MLS now

The next best thing is that your home is for sale now. Your agent needs to show that it is priced to sell and can provide buyer activity so that the seller can see it is going to get an offer very soon. If it has an extended days on market, this will not look appealing to the seller.

Your home is ready to be listed for Sale

The least appealing offer is one that has a contingency that you need to sell first but are not prepared to have your home listed for sale immediately? If you have found the perfect home but your home is not cleaned, repaired, de-cluttered and ready to photograph and show, you are going to have a harder time convincing the seller to accpet your contingent offer when it would be two weeks away from being listed at best.

Unforunately for you, the seller would be better to advise you to come back in two weeks, if the home is still available, when your house is officially listed for sale.

NOT Making a Contingent Offer

The easiest offer is cash. These offers do not reuire the time it takes for contingencies to clear for example, appraisals. There are also no hurdles to be cleared like another house needing to sell for the buyer to have enough funds to buy the initial house. Most people need a loan and most people will be selling a house in order to buy a new one, so what can you do? Make your offer as cash oriented as possible.

  1. Sell your house prior to making an offer and make the contract so it does not close for 10 weeks minumum. This should give you 4 weeks to find a home with plenty of time to close on the home you would like to buy. The seller of the home you want still needs to fit into this timeline, but this blog is about best situations. Your agent needs to have the skills to negotiate so you do not go homeless.
  2. Have a large down payment as part of the offer. This let's someone know you are serious, cash talks! Your agent can still put clauses into the contract to protect you and your cash downpayment.
  3. Sell your home to an investor. These people will buy the home on your timeline at an agreed price. This puts you in a cash buying position. You can sell sooner and make a completely cash offer or make is contingent on your home selling but explain to the seller you have a cash buyer, which basically means you have cash.

It is still a sellers market so being creative and thinking outside the box is what you may need to do to win a home. That may sound funny, but 'winning a home' is how it feels when you are competing with multiple offers house after house. Remember this blog post if you are not working with an agent who is aggressive enough.

Trey Langford

Posted by tlangford at 4/7/2019 8:22:00 PM

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