2022/06/02 | Team Hani Al Olabi
Did You Know?
One of the most common and challenging questions that sellers have to face is "What Should I Do First: Buy or Sell?"
Ultimately, there's no right or wrong answer as it depends on each individual. You need to consider factors like the market we're currently in, your finances, risk tolerance, and worst-case scenarios. Let's delve in to help assess and determine the best fit for you.
3 Types of Markets
Before we discuss the pros and cons of buying and selling first, we need to go over the 3 types of markets because they will have a huge impact on the decision.
1. Seller's Market
In a seller's market, demand is high and supply is low. In this market, prices are higher, multiple offers situations promote no conditions, and properties sell quickly.
2. Buyer's Market
In a buyer's market, the reverse is true. Demand is low and supply is high. In this market, conditions in offers are more common, properties stay on the market longer, and prices are more negotiable.
3. Neutral Market
In a neutral market, demand is equal to supply. Unique properties are likely to sell higher with no conditions, however, prices are stable.
Selling in a Seller's Market
Sellers in a seller's market know that their property will sell in a matter of days with multiple offers, so they are tempted to buy first. With limited inventory, they know they might miss out on numerous offer presentations for properties that they love, so they prefer to secure something in their hand before selling their home.
Selling in a Buyer or Neutral Market
Sellers in a buyer's or neutral market will prefer to sell first. Knowing that their property will stay on the market longer before it sells and that they might have to reduce the price, they choose not to take the risk of buying first. If the seller doesn't get the price they want, they are under no obligation or rush to lower the price of their home to create a quick sale.
What Happens When You Buy First?
Buying first will give sellers more time to browse the inventory of homes, increasing the likelihood of finding their perfect dream home. Although you can search at your own pace, if you do decide to purchase a home in any market, it will ultimately put pressure on the sale process. The seller's decision to sell is now based on a must-sale situation. Even in a highly competitive seller's market, they might not get the price they had in mind.
What Happens When You Sell First?
Selling first is always the safe way to go since the motivation for selling is to get the best outcome possible, especially if the market changes rapidly from a seller's market to a buyer's market.
Selling first will also give you precisely how much money you have in your pocket to work with on the purchasing side. If maximizing the sale of your current home is your #1 priority, strongly consider selling first.
If you have any questions about whether you should buy or sell first or real estate in general, don't hesitate to contact us as we will be happy to help! You can reach me directly at 647-298-7500 or by scheduling a meeting with me.Check Out Our Animated Video!