This may be one of the most aggressive seller’s markets that I have seen in my 25-year career, fueled by the fact that there are too few properties to purchase, prices are high, rates are low and demand is rabid. So what is stopping you from selling your house today and moving on to the next one?
Every day I am bombarded with notices of first time buyer programs, classes and products. But as an industry we appear to be ignoring our first time sellers.
There is a first time for everything, but unlike your first taste of sushi, or first time skiing, a high cost transaction can be very intimidating for a first timer, especially in an aggressive market such as this one. Don’t hesitate; instead educate yourself about the process so that you can approach selling your house with confidence.
Start with the lender: You need to investigate what you can afford once you sell your current home, or if it is possible for you to purchase without having your home sold. A qualified mortgage advisor will walk you through the steps and options. Many people discover that they can qualify to make a step up in housing without having their current home sold, which gives them a lot more flexibility because they can buy before they sell. Learn what your buying power is, so that you can determine if your needs and wants will be met in the price range.
Meet with your Realtor: Once you understand your buying power meet with a Realtor for the selling side and the buying side to determine a pricing strategy for selling and a timing strategy for buying. Learn what your buying power will get you, study communities where you are likely to purchase. I don’t recommend looking at specific properties if you do not have all your ducks lined up. If you happen to find your dream house and you are not ready to buy you will be disappointed and frustrated, so look through MLS and drive through the cities and towns that interest you in the meantime.
Come up with a plan that buys you time! Once you know what you’re buying power is and you have a good idea of what your house is likely to sell for, do what your listing agent tells you: clean up, spruce up and stage your house for sale. Work with your agent to determine a timeline for the sale. First time buyers do not have to sell in order to buy, so you can make the rules. You can list your house with a timing strategy, and have a statement directly in the multiple listing service that states "closings on or before" and specify a date that is four to five months out. Remember, inventory is tight, so if a buyer falls in love with your house they will work with your timeframe. For example, the buyer can lock in their rate for 90 to 120 days and if that is not enough time for you, you can close on the sale of your home and rent it back from your buyer for up to 30 days, giving you months to find and buy the next house of your dreams! There are many ways to work this out; you simply need to create the right selling/buying strategy for your situation with your professional team.
Take a serious look at renting: Many sellers are enjoying the freedom of renting for a time. Yes, it can be disruptive to move and then to perhaps move again. However, renting can be a great way to explore a new neighborhood or style of living to see if you will enjoy it before engaging the purchase process. I have had sellers who have opted to live with parents or other family members, or who have rented summer houses and put their stuff in storage while they look to buy.
There are whispers in some of our communities of a new real estate price bubble forming; perhaps it makes real sense to sell today taking advantage of these new price highs before the market swings in another direction.
Get educated, and don’t let the fact that you are a first time seller prevent you from participating in the incredibly competitive real estate market. With the right team you can get to your next dream home!