One of the biggest (and first) questions you’ll need to figure out is whether you should buy or sell first. The answer can vary (though I’m usually in the “sell first” camp) and it rests on three things: 1. what are the current market conditions in your neighborhood? 2. What personal situations are affecting your sale? 3. Are you going to be able to afford carrying two mortgages if your current home takes longer to sell?
If it’s taking homes around you several months to sell, you may want to consider selling first. If homes are selling in a matter of days, you may want to buy first and secure your next place. Talk over your options with your lender and real estate agent to see which choice works best for you.
Selling and buying homes is expensive business – there are land transfer taxes, legal fees from attorneys, real estate commissions, moving costs, costs for switching over utilities, homeowners association transfer and estoppel fees and more to consider.
Simply moving from one home to another that is incredibly similar just doesn’t make financial sense, so make sure you run all the numbers to consider the costs of living in different neighborhoods, how much space you’ll really need and other features tied to the costs of the home.
Something has changed to make your current home no longer ideal, so try to plan ahead for your needs in the next 5, 10 or 30 years that you’ll be living in your next home. Do you need to change locations to be closer to schools? Are you planning on needing extra room for aging parents or more children on the way?
Whatever the circumstances, really think about everything that you want and need out of your next home.
Now that you’ve lived in your current home for some time, it’s time to weigh the pros and cons of living there to help shape your home and community search as you prepare to move. Are you near where you work and like to hangout with friends? Do you wish there was an HOA to keep things in order? Is everything within walking distance? Close to the kid’s schools? Too far from your favorite dog parks?
Consider what’s most important to you, add it to the list and keep it close as you start looking at new homes.
Maybe you feel that there’s never enough room for everyone to spread out and have some space. Maybe you think you’ll never find such a great kitchen layout ever again. Whatever you love and love to hate about your current home, it’s time to once again write it down and keep the list handy for your upcoming home search.
Let’s be honest, have you maintained your current home in like-new condition or do you find yourself closing your eyes in the hope that the shabby paint colors and cracks in the ceiling will go away? If home maintenance falls off your to-do list more often than you’d like, maybe it’s time to consider what type of home you should be eyeing for your next move.
Hate yardwork? Maybe opt for a condo or townhome. Love home projects? Choose a single family home where you can DIY to your heart’s content. Not the best at dealing with repairs? Have a fresh start with a new construction home that will come with a warranty and a couple years of (hopefully) repair-free living.
Don’t start falling in love with homes you see on the market without thinking through your selling strategy first. Start prepping your home to sell, consider getting a pre-listing home inspection to discover any under-the-radar problems if you’ve lived in the home for several years, and get clear on your bottom line when it comes to closing costs, loan payoffs and net profit.
Check out our 30 Days to List Your Home checklist for a jumpstart on what you can start doing now.
If moving means straining yourself financially to afford the new, bigger house, the best move might be to wait to save up more money and build more equity in your current home.
Talk with your lender to find out the most up-to-date balance of your mortgage on your current home, and talk about estimating how much extra you’ll potentially be spending each month on your new mortgage