Homeowners inside a seller’s market face a conundrum: on the one hand, their home is worth more than it has ever been, but on the flip side, if they decide to sell it and buy a new one, they’re going to face stiff competition, high prices as well as a market where homes are selling in record time.
Fortunately, with the proper strategy, it’s possible to take full advantage of sky-high home values and find a home that’s a better fit for you and your loved ones. Here are a couple tips on how to navigate this tricky situation.
Ways to Sell and purchase your home inside a Seller’s Market
Step 1: Begin looking for Your New Home First
In a neighborhood with high demand and a lot of motivated buyers, homes can sell within a month. You don’t want to get stuck in a position where you are making a rushed decision on a home on account of your current one is about to selling.
Step 2: Work with Nick & Cindy Davis to Plan Your following Move
Option 1: Buy BEFORE You Sell
To compete against other possible buyers, you should put the least amount of contingencies on your offer as possible. Inside a seller’s market, we don’t recommend that you place an offer on a home which is contingent on the sale of your current one, mainly because it will turn sellers off. Instead, you should check into gap financing.
Option 2: Sell First, But Work Out a Deal with the Buyer
Any time you own a home inside of a seller’s market, you have the upper hand. Buyers in many cases are prepared to offer incentives to close the deal, and they’re flexible on the timing. Which means it is possible to ask for additional time if you would like it.
Option 3: Make a Contingent Offer, But Make it Strong
For those who don’t qualify for a HELOC or bridge loan, you can make an offer on a home that’s contingent on selling your present one, however it needs to be as strong as it can be.
In hot real estate markets, it’s actually possible to find renters who will pay more than what you owe each month on your mortgage. But you’ll need to speak with a lender first to ensure renting your home is an option; if the home isn’t completely paid off and you need another mortgage to purchase your next home, it implies you’ll be taking on two loans at once.
If you’re open to moving into a rental, then you can sell your present home and save the money for when the time is right to purchase, taking the pressure off. Sometimes the hassle of moving twice in a short time period could be worth it, if you’re able to locate a rental in your price range.
The Good News
Although the market is competitive, we are here to report that there are actually fewer all-cash offers being made by foreign investors this year. And even when there are all-cash offers on the table, they haven’t necessarily been winning. We’ve been involved in deals where the seller rejects an all-cash offer and chooses a buyer based on the letter they wrote with the offer.
If you’re planning on buying or selling soon and would like to discuss your choices with Nick & Cindy Davis. We can always be reached at 813-300-7116 or simply click here and we will be in touch.