Greg Bennett - The Home Expert

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Ahhh, the dreaded ‘Which Comes First’ question. Chicken or Egg. Multiply or Divide. Weights or Cardio. OK, that last one is completely new to me, but I digress.

All of these questions have some philosophical undertone to them. Which is to say, there is always a seemingly good argument on either side. And so too is the case when it comes to Buying a Home. Do you do it before you sell your existing home or wait until the deal is done?
Sometimes people over-think this process, cant figure it out and end up staying in their home….like forever. And others just charge ahead with one part of the equation without understanding the implications the other has on their current activities.
Now under certain circumstances, the decision can be a little easier. If you find yourself having to move for work reasons, or something similar, the decision is often a little bit easier. You know this has got to happen, and you generally may accept that there could be a period in-between where you are not a home owner. Renter? Somebody’s new roommate? Whatever. You know there may be a gap in there, so you prepare yourself for that inevitability. If you’re lucky, whomever is behind the move is helping you out with some of the implications of this type of move. ‘Should We’ can sometimes be more stressful a decision than ‘When We’ is.
But for many of us, the idea of moving is a decision you contemplate until you come to terms with it.
You may consider moving because you have outgrown your place. You may have too much space, now that the kids have grown. Maybe you figure you have enough equity that you can now find a place that you can afford mortgage free (once you’ve sold your place). These types of moves tend to be a little less urgent, so you often have ample time to think things through. Doesn’t mean you can always come up with the ideal scenario, but again, if it looks like things aren’t going to fall together in an acceptable way, you can back off a bit and re-think it.
And then there are the people who….well….just move around. It may be motivated by a desire to take advantage of a hot market they currently live in. It may be an opportunity to move into a newer, nicer home being offered at a great price. It may be someone who needs a ‘fresh canvas’ now that they have re-decorated every room in their current home.


The fact is, if you are in one place and you are trying to get to your next destination, it can be tricky. In some cases, it can completely work against you. For example, lets say you found an area that is just perfect in your mind. You HAVE to live there. But it’s a hot market. And in a hot market, there may be a few things you might not otherwise have to deal with.
First, the homes in a hot market go quickly. Under these conditions, you need to be motivated and ready to jump when the right place becomes available. Otherwise, you just end up getting frustrated when it seems like everything you like is gone before the weekend comes.
Second, the Sellers in a hot market can be a little more picky about the offers they will take. Hot market means they could be getting a lot of offers. More specifically, they want (and typically favor) offers with few conditions. If  you want to buy, but you have to sell your own home first, the Seller is less likely to have their deal hung up on your success selling your own place before you can buy theirs.  The fact is, most Sellers period are less inclined to accept ‘conditional on sale’ types of clauses, hot market or not.
You can certainly try anything & everything you want to get to where you want to be. But there are some things that can at least lessen the anxiety a bit. So if you own a home, which you plan to sell in order to ‘move on’, here are some things to consider.


Is your house ready to sell? 

This is a really key step. First and foremost, you want to get the most for your home and sell it as quick as possible. There are all kinds of headaches that come with selling your home, so the faster the better. If you spend the time up front getting everything ‘just so’, you really will be doing yourself a favour.
Now this doesn’t mean you have to invest a ton of time & money in your home. It can be as simple as a coat of paint, trimming up some landscaping that has gotten out of hand, or fixing up a couple of those small dents & dimples you’ve grown to live with. Of course, some people may choose to do some significant work on their homes. The general rule of thumb is to make sure that whatever you choose to renovate, you can get back a solid percentage of that cost when you sell. Kitchens & bathrooms often pay off. Putting down new wall to wall carpeting may not.
One really easy one (again, in theory) is clear out your junk. Now I have heard about these shows where they help hoarders…. uhhh, de-hoardify their homes. You may not be one of these types, but you should keep in mind that potential buyers want to see open space. As George Carlin once said ‘Everyone needs a place for their stuff’. If your home is full of your stuff, people wont get a good sense of where their stuff is going to go.
That doesn’t mean you have to throw everything out. But you really should think about netting it down. The guideline I try to follow:

  • Do you use it more than once a month (during certain seasons)? Leave it alone.

  • Do you use it only once or twice a year? Put it in some sort of box or container.

  • Do you rarely ever use it, but it has sentimental value? Put it in a box or container, or even consider a storage facility.

  • Do you rarely even use it, or even think about it? Kijiji or the dump. Seriously, if you move, you are going to pay someone to move it. Get rid of it.

Once you have things in boxes or containers, try to stack them as nicely as possible. A big, unruly pile of boxes isn’t going to do you any favors.
I know I’m making this sound really easy, and I know it isn’t. But you will thank yourself for it later if you at least take a shot at it.


Can you buy before you sell? 

Lets say you are of the mind that you don’t want to seriously consider a move before you’ve found your ‘Dream Home’. Now even though I’ve mentioned that Sellers tend to shy away from conditional offers, some may accept your conditions. If the home you’re looking at is not a popular design, the Seller may be happy to work with you. The area itself may not be ‘hot’ at then time, so again, the Sellers may entertain your offer.
However, you do have some other options open to you, depending on your situation.
You might be able to get some form of ‘bridge financing’. Now this depends on the lenders you choose to deal with. And there are risks that both you should be considering and the lender will be considering. In short, if you take out a loan in order to buy a new home, and you haven’t sold your existing home, can you afford to cover your living expenses plus the cost of the loan.
People have been known to get themselves into all manner of financial trouble doing this, so you should always be cautious when taking on additional debt. You may think your existing house is really nice and should move quickly, but there are all kinds of things that are out of your control, which can throw a monkey wrench into your situation. Be careful not to get ahead of yourself.

Do you have to buy right now? 

Some people honestly feel like when they see something that they ‘just have to have’, that it will never be available again. Now of course in some situations, that can be true. I believe there is such a thing as ‘a once in a lifetime’ opportunity. And maybe I’m conservative in my views, but when it comes to real estate, the ‘once in a lifetime’ means EVERYTHING comes together. Not just the availability of a house you really like. Everything including the conditions that will make it possible to buy it without putting yourself at risk.
I mean, houses are built. And if someone has built one, chances are it has been built a number of times. Sure, custom-made homes are…well… custom. But generally, most people who can muster up a sufficient amount of patience will be able to find a number of homes that are pretty darn nice.
You may have found a number of homes that you really love, and none of them were for sale. That shouldn’t discourage you. You should keep track of them, and establish a relationship with an agent who will keep a watch out for you. Most agents, if not all, would be happy to do so.


Should you buy right now? 

Another thing to consider is the nature of your move. Are you making a fundamental change to the type of residence you are going to live in? Then consider this.
I know a gentleman who had decided to sell his 2000+ sq ft home and downsize. He was thinking something along the lines of a 2 bedroom condo. Perfect, given his needs. He had owned several homes similar to the one he was currently living in, but never a condo.
So he sold his place, and arranged for a closing that would allow him to deal with all the downsizing activities he knew he would have to do. Note: I will touch on this another time, but downsizing is probably a lot harder than you think it is. Anyway, rather than buy that 2 BR condo right away, he decided to rent a 2 BR apartment. That turned out to be the smartest move he could have made. Let me explain.
When he got the floor plan of the apartment he was considering, as most people do, he started marking out where he’d place his furniture. Everything he planned to move looked like it would fit pretty well. The location seemed convenient to everything he thought he would need. Although he’d never lived in an apartment/condo residence, when he did the pre-lease walk-through, it seemed pretty much what he expected. So he signed a one year lease, and moved in. And having invested the proceeds of his home sale, he was making enough to cover his rent and then some.
And then he moved in.
Now he expected he’d need a bit of time to adjust, so he took a few months to mull over this new scenario. It didn’t take him long to realize a few things that you simply cannot know beforehand.
First, he felt crowded. Not tripping over things and always walking sideways crowded, but just not comfortable. His kitchen simply didn’t have enough cupboard and counter space. And this was a single guy with no real flair for fancy cooking or entertaining numerous people. The location turned out to be quite dusty, due to the amount of traffic outside his windows. And although he hadn’t really given it too much weight (no pun intended), having some on-site exercise facilities would have also been nice.
But the good news was, he rented first. Sure, he would have to move again, but he wasn’t going to have to pay all the Seller costs all over again. Most importantly, he now knew (a) he would need a place at least 1100 sq ft, (b) he needed a kitchen with a certain amount of countertop and cabinet space, (c) he wanted workout facilities, and (d) he wanted the area around his new residence to be ‘less pavement, more grass’.
Well, 8 months into his lease, he went condo shopping and found the perfect place, with what he now refers to as ‘his million dollar view’.
Now this was a perfect ending to a somewhat rocky start. In some cases, renting gives a seller a perfect amount of buffer to deal with major changes. As with this particular case, if you want to move into a style of residence you’re not familiar with, you might do well to rent first. I mean, an alternative ending to this might have been he absolutely hated apartment / condo living, and ended up just buying a smaller bungalow somewhere. You never know until you try.
On the other hand, I’ve seen people decide to sell their place and rent, wait too long, and then find the cost of housing has increased so quickly that they cant get back into the market at the same level they got out at..

Renting isn’t for everyone. People who have owned most of their lives often find it a bitter pill to swallow. But it does have its advantages under certain circumstances.

Wow. Sorry, that was a lot of information. So as we’ve outlined here, there are a number of things that can and/or should factor into your decision. If you own a home and you are ready for a move, the best advice I can offer you is this:

  • If you are thinking about a move, make sure your existing home is ready to sell. You should try to avoid rushing around at the last second, trying to get your home in ‘sell-ready’ condition.

  • If you are going to buy a home before you sell your existing home, be careful not to put yourself in a risky financial position. Nobody has a crystal ball, so nobody can guarantee you will be able to sell your home exactly when you want it to sell.

  • Be patient. Odds are, you will find more than one home that you will be excited to move into.  Try not to feel disappointed if you can get a specific home because you aren’t ready. There are lots of great homes on the market just about all the time.

  • Renting may be a good option for you, particularly if you are moving into a style of home that you are unfamiliar with. Living in a condo is much different than living in a detached 2 story. Be careful not to jump too soon.

  • I know I obviously have a bias here, but having bought & sold my own homes prior to getting into real estate myself, I can tell you, there is value in securing a good agent to evaluate your unique circumstances and help you determine some strategies for you to consider. And whatever course of action you choose, there will be times when you need someone (other than your significant other) to clarify things that are happening, make sure you understand both what is and what will be happening, and sometimes remind you of what you set out to do (in case you have a severe attack of ADD, as we all have from time to time).

Looking at a move to a new place can be a lot of fun. But to insure it stays fun, make sure you are cautious about your approach. Enjoy!

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Greg Bennett - The Home Expert
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