Alberta families who have outgrown their homes may be in the market for a bigger, more spacious residence. The question is whether to buy a new home first or sell the current one beforehand. The answer depends on the people involved as both options have pros and cons. Regardless of the course of action, this residential real estate dilemma needs a backup plan.
When the homeowner hunts for a new house before putting the current one on the market, there is typically no rush. Also, if an offer on a particular home is not accepted, there will likely be time to look for something else without a deadline looming. However, one of the cons of buying first is a delay in finding a purchaser for one's current home. The purchase may close sooner than expected, leaving the homeowner with two current mortgages to pay, along with additional fees related to the purchase.
On the other hand, selling first will avoid the problem of having to pay two mortgages. Also, knowing the price at which the sale closed will give the purchaser a better idea of the price range that is affordable for the new house. A significant disadvantage is the fact that the person who bought the house will have an occupation date that the seller will be expected to honor. Rushing the purchase process may lead to a transaction that is not ideal or more expensive than anticipated.
With the combined support and guidance of a real estate agent and an experienced residential real estate lawyer, the buying of one home and the selling of another might be perfectly synchronised. A realtor will work to ensure the real estate arrangements and procedures go smoothly. In turn, an attorney will scrutinise documents before signatures are made, and can arrange a purchase offer on condition of the sale of the current home and more. With the right guidance, an Alberta family may even be able to arrange bridge financing if there are two mortgages to pay for a period of time.
Source: reco.on.ca, "To buy first or sell first?", Accessed on Feb. 25, 2017