It seems like the best place to start is where many of our clients begin: How do I know if this is a good time to buy or sell a home?
Sometimes, we don’t have to ask this question since there are reasons forcing us to act. For example, you may take a new job located out-of-state forcing you to sell (and maybe buy) or you need to ditch the bachelor pad in favor of buying a new home as man and wife.
But, many times, we have choices in our timing. Currently, here in the South Bay, we are in a hot seller’s market. This makes it great if you own a home and you want to sell. Many properties are still selling with multiple offers. Price levels in many cases are above their 2007 levels.
If you are a buyer, these multiple offer situations are very competitive and stressful. Many current buyers are highly qualified; some of them are “all cash.” This creates a very challenging environment as a buyer right now. So, why would you put yourself through this difficult process if you don’t have to? In two words: interest rates. Interest rates have remained at historically low levels resulting in increased purchasing power for buyers. Additionally, rising rental costs may make it more advantageous to buy rather than rent so if you are renting, this is a great time to make it a priority to buy.
The challenge may be that you have a house to sell before you buy your new home. Now you are a buyer and a seller. Where do you start? Do you market your house first or do you wait to identify your new home first? In many cases, if you wait to find your new home first, you are likely to lose that home to a buyer that is more prepared to put in an offer without a contingency to sell their home first. In this market, being a better boy scout, or girl scout, is the way to go; be prepared. So, selling first and asking for a long escrow plus making your sale contingent on finding your new property may avoid a painful loss when you make an offer on your new home.