How Do You Sell and Buy a Home at the Same Time?

Buying a home can be stressful. Selling a home can be stressful. Doing both at the same time? That takes a little more planning!

For many homeowners, especially those who need the equity from their current home to purchase their next one, selling and buying at the same time creates what we often call a “domino effect.”

Your sale may need to close before your purchase can close. And sometimes the buyer purchasing your home also has a home to sell. Suddenly, several transactions are connected, and each one needs to stay on track for the next one to work.

The good news is that people successfully sell and buy homes at the same time every day. The key is understanding your options and having a plan before you start making offers.

Why Coordinating a Sale and Purchase Can Be Tricky

Even when everything is going well, back-to-back real estate closings have some logistical challenges.

A closing could be delayed. Funding or recording could take longer than anticipated. Possession dates may need to line up. When several transactions depend on one another, a delay in one can affect everyone else down the line.

That’s why we like to talk through the entire process with our clients early. There isn't one strategy that works for everyone.

So, what are your options?

Option 1: Sell Your Current Home First

One of the simplest ways to eliminate a home-sale contingency is to sell your current home before purchasing the next one.

Once your sale closes, you have access to the proceeds from your home and can begin shopping without needing your current property to sell.

That can make your offer on the next home cleaner and potentially more competitive.

The downside is pretty obvious: Where do you live between homes?

You might need to arrange temporary housing, rent for a short period, stay with family or friends, or move your belongings into storage. It can also mean moving twice.

Before assuming you absolutely must sell first, it's worth talking with your lender and Realtor about your financial situation and the other options available to you.

Option 2: List Your Home and Get It Under Contract First

For many homeowners, this can provide a good balance between selling first and buying first.

You list your current home, accept an offer and then begin seriously shopping for your next property.

When you make an offer, it may still include a home-sale contingency, but there's an important difference: your home is already under contract.

That can give the seller of the home you're purchasing more confidence than an offer from someone who hasn't even listed their property yet.

There are still tradeoffs. You may be limited by the homes available during the period in which you need to purchase, and some sellers - particularly in a multiple-offer situation - may prefer an offer without a contingency.

This strategy can work especially well when the buyer purchasing your current home has some flexibility with their closing or possession date.

Option 3: Find Your Next Home First

Another option is to find the home you want and get it under contract before selling your current home.

Your offer may need to be contingent upon successfully selling your existing property.

The big advantage is that you're not choosing your next home simply because it happens to be available after your current home sells. You have an opportunity to find a home you actually want before starting the clock on your sale.

It may also allow you to coordinate the transactions so you only have to move once.

However, not every seller will accept a home-sale contingency, particularly when competing offers are on the table.

If this is the strategy you want to use, preparation becomes extremely important. Your current home should be ready to hit the market quickly once you find “the one.”

Option 4: Consider a Bridge Loan

Depending on your financial situation, a bridge loan may be another option.

A bridge loan is designed to help finance the gap between purchasing your next home and selling your current one. This may allow you to purchase first and then sell your existing home afterward.

That can remove some of the timing pressure and potentially allow you to make an offer on your next home without a home-sale contingency.

However, bridge loans aren't right for everyone. There can be higher interest costs, additional payments and financial risk if your current home doesn't sell as quickly - or for as much - as anticipated.

Talk with a qualified lender before considering this strategy. You want to understand the costs, qualification requirements and potential risks before making a decision.

So, Which Option Is Right for You?

There really isn't one answer that works for every homeowner.

Your price range, equity, financing, local housing inventory, current market conditions, and where you're buying and selling can all influence which strategy makes the most sense.

That's why we recommend starting the conversation before you put your home on the market or begin making offers.

At The Brown Team at Sage Door Realty, we can help you look at the entire picture - selling your current home, finding your next one, coordinating timelines and working with your lender to develop a strategy that fits your situation.

Selling and buying at the same time can feel complicated, but with the right preparation and communication, it is absolutely doable.

Thinking About Selling and Buying in the Kansas City Area?

If you're considering selling your current home and buying another in Blue Springs, Lee's Summit, Independence, Grain Valley or the greater Kansas City, Missouri area, we'd be happy to sit down with you and talk through your options.

There doesn't have to be any pressure to list or buy immediately. Sometimes the best first step is simply understanding what your move would look like before you make it.

Steve Brown
The Brown Team | Sage Door Realty