Should You Sell Before You Buy?
This is a question that comes up often as homeowner looks to make their next move. The real estate market in Kelowna changes from year to year. While it might make sense to sell before you buy a new home in some market conditions, it could be risky in others.
Things to consider before deciding to sell before you buy:
What type of market is it?
Seller’s market:
When the market is considered a Sellers’ market the risk is lower if you decide to sell before you buy. A Seller’s market is when the active inventory of listings is lower than the demand of homebuyers. This market condition often generates multiple offer situations, giving the seller an advantage to choose prices, terms, and dates that work for you. However, one thing to note is if you are buying and selling in the same market, you will be faced with the same challenges as a buyer when buying a new property.
Balanced Market:
A balanced market is when the number of homes for sale in Kelowna meets the demand of buyers looking to purchase a home in Kelowna. Typically average day on the market is 90 days to sell, which would give you time to find a property to buy. These market conditions will lower your risk if you decide to sell before you buy. And you would have more options
- Placing an offer on a property with the subject of selling your home
- When securing an offer, ask for longer possession dates to allow time to find a new home
Buyer’s Market:
While this market condition is great for buying a home, selling a home can become more difficult. A buyer’s market is when the inventory of homes for sale is far higher than buyer demand. Days in our market are well over average and sometimes force sellers to reduce the listing price to sell. This would be very risky to sell before you buy a new home as you risk not only owning multiple properties, you risk buying high and selling low. Your agent should always recommend selling before you buy or at minimum having a condition to selling your home.
Are you in a position to carry two properties?
Something to consider when trying to decide to sell before you buy is your ability (and comfort level) to own two properties.
There is always a risk when you decide to sell before you buy a new home. And, your decision would be based on weighing out the risk and reward. Perhaps you secure the home or property that you’ve been dreaming of, and holding two properties is worth that risk.
Charlene Volk from the Vrecko Real Estate group reviews the following questions when a client is considering taking the risk of buying before selling. It’s important to know what you are getting into.
- As it may take some time to sell your home are you willing to wait?
- Does the risk outweigh the reward?
- Have you considered the cost of holding two properties?
With all things considered, you should talk to a professional real estate agent before you decide to sell before you buy a new home. They can review what is the best choice for you and your situation.
Every professional real estate agent at Vrecko Real Estate Group has extensive experience in buying and selling real estate. Based on your specific situation, they can direct you and give you advice to make the best decision for you and your needs.
