Buying a home is a big decision, and things can get even more complicated if you already have a home. First time home buyers have all the time in the world to carefully choose the home of their dreams, but if it’s your second or third time around, you are in a different position: do you sell your current home first and then buy, or do you buy first then sell your current home?
There are advantages and disadvantages for both scenarios, and it really depends on a few different factors. Selling first means you may be under pressure for finding your next home or may have to rent until you find the right home. On the other hand, if you purchase first, you then have to sell yours to finance the purchase. Either way, your Realtor will be able to guide you in the right direction and make sure all the necessary paperwork in included in the contract of sale.
An important thing you may want to keep in mind if you choose to buy a home first before selling your current one is to insert a conditional clause in your offer that makes the sale conditional upon the sale of your property. There are a few different ways to structure this, and you would want to make sure to discuss this with your Realtor and include it in the contract of sale.
Conditional Offer / First Right of Refusal
A conditional offer is a fairly traditional type of offer to include in a sales contract. The purchase of a home is typically conditional upon certain elements, such as financing or a home inspection. In this particular case, it allows the seller to continue actively selling the property, but if an offer comes in, you get the first opportunity to purchase the property. The only catch here is that it’s typically only within a certain time frame, so you would have to sell your property before that time is up.
Bottom line is that everything is negotiable, so you want to make sure you are clear on all your options and make the best decision moving into making an offer. If you are still deciding whether or not to buy first or sell first, but want to get the home hunting process started, send me an email! I love playing tour guide and know all the neighbourhoods in London and the hot spots around the city.