Many home and farm buyers have a property they must sell in order to have the capital to purchase their next property. Coordinating buying and selling homes at the same time can be a bit precarious as the transactions need to align just so. If you find yourself in this position, take a breath. You are not alone and there are ways forward.
If you have the finances to purchase first and then sell your current home after you’ve moved, then lucky you! Unfortunately, many sellers need the proceeds of the sale to finance their new property and the sellers of that new property won’t be too happy to see an offer that includes a contingency for the sale a home or a farm, particularly one that is not ready to be listed. Needing to both sell and buy at the same time is stressful regardless of the type of real estate so here’s what you can do!
Come up with your game plan. Decide when you would like to move, meet with your listing agent, speak with your lender, and get an idea of what is on the market in your price range.
Get your property ready to sell. I mean all the way ready. I like to have the listing package ready to go before we start looking at properties. Why? It makes your offer more appealing because an offer contingent upon the sale of another property is usually a major strike against a buyer. If I can show the agent that we are ready to list within a week and present them photos of a well prepared home or farm, then we stand a much better chance of getting your offer accepted.
Start looking for a new property. Now that you have done the work of preparing your current home for sale, we can start looking for a new place and you can rest a bit easier knowing you don’t have to scramble to prepare your current home when we find your new one.
Get creative with terms. Discuss offer strategy with your agent. If you know that you are taking a hit with a contingent offer, there may be other terms you can offer that would be appealing to the seller. Maybe the sellers would prefer inspections where you can just walk away rather than asking for repairs or perhaps they don’t want to clean out the outbuildings and you can agree to take care of that. Making your offer feel convenient to a seller can go a long way.
A common question…
What if I know my property will take some time to sell? There are cases that might require listing before we start looking at properties. Slow markets, high price points, and large farms are some examples. If we know it might take some time to sell, then we can list first, but you may need to write in a Home of Choice Contingency if you find a buyer for your property before you find a new home. This contingency allows you to void the contract if you do not find a new property within a certain time frame. Note that for a buyer, this carries the same sort of risk a seller would assume with a contingent offer and not all buyers can accommodate a Home Of Choice.
Sarah is a Realtor specializing in residential and equestrian properties. She is based in Howard County, Maryland.
Posted by Sarah Lipkowitz on
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