Is it smart to purchase a home before selling your house? Or should you sell your house first and then buy? In Toronto, our market defies gravity, so if you sell first, you better find a new home quick or risk being priced out of the market. On the same note, if you buy first and wait too long to sell your home, you might miss the market. Read below for our top tips, whether you chose that buying first or selling first is better for you.
To buy first, you need to be confident you can sell your home too. In a market like ours, that shouldn’t be a concern, unless you have a specialty home that could take a few months to sell. Below we’ll discuss the benefits and drawbacks to buying first vs selling first.
Benefits and drawbacks to buying first
- You can take your time to find the perfect home.
- You control the timeline for your move.
- If your new home requires renovations, they can be done before your move in date. You can even include the cost of renos into your mortgage (Isn’t that a dream come true).
- But, no one can guarantee how much your current home will sell for.
Benefits and drawbacks to Selling first
- You know exactly how much money you have to spend on your purchase.
- You are guaranteed the proceeds from your sale, so you can purchase a home without bridge financing.
- But, low inventory of homes means you might not find the exact home you’re looking for.
- If the area you are buying in is appreciating quickly, you risk being priced out of the market the longer you wait.
Timing is everything though
It’s important to remember our market is very seasonal. We have a very strong spring market, but by August, a lot of buyers have purchased a home or are taking family vacations. Check out this blog about timing the market. Our advice is to try to buy and sell in a very short period of time, to avoid buying at a market high and selling in a market low. Otherwise, take a look at the calendar in our blog post mentioned above to see the hottest days to be on the market. If you’re going to purchase a home during a busy month, make sure you can sell your home during a busy month too.
What would we do?
The main benefit to buying first, is that you are shopping on your own terms. You can take your time to find the perfect home, and in a market like ours, you know your home will sell. As long as you purchase a home within your means, buying first is a good action plan. However, if you want to sell first and then purchase a home, that is still a fantastic option.
Our market is strong, and if you buy and sell with sound mind, you should have a very successful move. Regardless of whether you’re selling first or buying first.