4 Minute Read
With homes in many markets being snatched up left and right, it’s easy to let your emotions take over when you find that perfect home. But what if your current home still hasn’t sold? Should you double down and buy the new one anyway?
Dave says not so fast. Here’s why.
Proceed at Your Own Risk
You might think paying two mortgages for a couple of months isn’t a big deal. But what if your home takes six months, or even a year, to sell? That’s a quick way to drain your emergency fund for something that isn’t a real emergency in the first place. With two homes on your hands and no savings in the bank, it’s just a matter of time before Murphy enters the scene. Whatever can go wrong will, turning your dream home into a total nightmare.
Still need convincing? In a seller’s market, submitting an offer with too many contingencies can easily knock you out of the running—and an unsold home is just about as big as a contingency gets. An existing mortgage can also make it difficult to get the financing you need to purchase your new home if you can’t pay cash up front, Dave’s favorite home-buying plan.
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There Is One Exception
If you’ve reached Baby Step 7 and are living and giving like no one else, by all means, pay cash for that new home and worry about selling your other one later. Not sure if you’re there yet? Ask yourself these questions:
—Are you debt-free?
—Do you have 3-6 months of expenses in your emergency fund?
—Is 15% of your take-home pay going toward retirement?
—If you have kids, are you contributing toward their college fund?
—Is your current home paid off?
—Do you have enough cash to put 100% down on the new house?
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If you can’t say yes to all of the above, then hold your home-buying horses. No home is worth putting your financial security at risk.
Simple Steps for Getting It Sold
So what do you do if you find your dream home before the right buyer calls dibs on yours? Put all your energy toward getting your home sold as quickly as possible. Here are a few tips to get you started.
—Set the Stage for Success: Your home is the star of the show, so it’s time to make it glitter and gleam! Wash the windows, clear out the clutter, and dress it up with a fresh coat of paint—whatever it takes to make your home’s shining features stand out. Don’t forget to pack up all your personal effects so buyers can picture themselves taking center stage in your home.
—Price It Right: Buyers will pass on a home that’s priced too high, without even taking an up-close look. So what’s the secret to perfect pricing? Start by taking the emotion out of the equation. No matter how much you think your home is worth or what you owe on your mortgage, it’s the market that matters. A real estate agent can run a comparative market analysis to show you how much homes in your area are selling for.
—Get Expert Help: You shouldn’t have to put your dream home on hold just because your agent takes a part-time approach to real estate. Partner with a high-octane pro who has a track record for getting results and will be honest about what it takes to attract buyers. Don’t be afraid to ask important questions, like whether the agent specializes in your area of town and how many properties they’ve sold in the past year. A stellar agent closes at least 40 transactions per year.
With a little patience, a lot of hard work and an experienced real estate agent as your guide, you’ll be placing that “sold” sign in your yard in no time. Hopefully, you’re off to a great start with an agent who’s already helping you move the needle. But if you’d like to see the top agents Dave recommends in your area, we can introduce you today.