Moving on Up: Why Now is a Great Time for Millennials to Sell Their Homes
More than any other generation, Millennials (also known as Generation Y) have taken hold of their independence and forged the precise lifestyle they’ve envisioned. A big part of that lifestyle is where you decide to live and the home you decide to live in, and Russell Robson has been helping homeowners just like you find the perfect home to reflect who you are and where you are at this stage in your life.
Now’s the Time
If you’re a Millennial, now is the best time to sell your home and take that next big step in your life. Selling your home is one sure way to upgrade your lifestyle and really begin to create and cement a solid foundation for you and your (future) family.
But selling your home means you’ll need to buy a home as well. Finding the right balance can be tricky and without the proper guidance you can find yourself losing some of the profit you’re hoping to make from selling your home in the first place. Determining whether to sell first, buy first, or do both simultaneously can be challenging. To help you out, let’s look at the risks and benefits involved in each scenario.
Perhaps the safest of all the scenarios, selling first requires that you list and sell your home prior to purchasing a new one. This removes all the pressure of dealing with closing dates and allows you to know exactly how much you can spend on your new home. It also puts you in a mindset of not settling for too much below asking knowing that you are in no rush to move into your new home.
The downfall of this strategy is that you’ll have to live in temporary housing for an unknown amount of time. This means putting all your household items in storage and either staying with family or a close friend or renting an affordable unit, which means spending some profit from the sale of your first home. Then you’ll have to move all those items out of storage and into your new home, which can all be a bit disruptive.
There’s not as much moving and disruption involved with this option as with selling first, but it can be a heavy financial burden. As far as benefits go, you can take the time you need to move into your new home without having to use and pay for storage or use the services of a moving company more than once. On the other hand, if you don’t sell your home in a timely manner, you’ll be balancing two mortgages for an undetermined amount of time.
Buying and Selling at the Same Time
This takes almost perfectly succinct timing. It often becomes necessary to apply for a home equity line of credit, a temporary loan on the house you are selling, as a down payment for the house you are buying. This bridging allows you to own two homes at the same time to cover the period between selling your previous home and buying a new one. To avoid ending up in the first scenario (selling first) and not having a home to live in for a short period of time, it’s best to schedule the closing of your current home after the closing of the home you are purchasing.
Consider the Market
When deciding to buy the new home or sell the old home first, you need to consider the environment you are entering; namely whether it’s a buyers’ market or sellers’ market. Knowing the condition of the market allows you to better leverage your home or position it to maximize the value.
When it’s a buyers’ market, there are a lot of homes on the market and at relatively good prices. You’ll definitely have your pick of houses, so under these circumstances it’s probably best to buy a home before selling your own. Some homeowners may even allow for a contingency where closing is dependent on when you sell your previous home; but even if that’s not possible, you can just arrange for financing and begin the staging and marketing preparations necessary for your home to be sold.
In a sellers’ market, the tables are somewhat turned. Sellers are able to set higher value for their homes, which leaves less leverage for you as a buyer. But moving on to a new home means you are a seller as well, so it may still be beneficial to buy a new home and muster up enough cash to hold you over, assuming your first home will only be on the market for a short period of time.
Neither of these scenarios should be attempted without the guidance of a capable and proven real estate agent. You need to trust that your real estate agent will guide you through this process and not leave any loose ends to chance. So make sure that you choose a real estate with a proven track record, like Russell Robson.