It’s Saturday morning and the houses for sale listings are open on your screens or in the newspapers and you make your plans to buy better, whether this is your first foray into real estate, or your tenth.
But what is the right way to go about buying real estate so you stack all the odds in your favour?
We have found that if you have a property that you will need to sell to enable you to buy a new one, the wisest move is to engaging your selling agent first, so you can enter the house hunting fray with some peace of mind.
Of course, peace of mind comes in different styles, so here are some insights to help you plan your real estate strategy, from the 40+ years of experience we have at McGrath Real Estate.
Buy better: Should I sell my home before I buy a new one?
There are many different schools of thought on this question, and I explored the many sides to this topic in a previous article.
In, Should I sell my house before buying? McGrath tips for reducing stress, I argued that nothing breeds confidence like having the cash behind you when you enter buying mode in real estate.
This is because the pressure of holding various funding elements together can be enormous.
The problem for the majority of those who buy a new home before selling their old one is that they need bridging finance to cover the shortfall until the original property sells. This means that until they are able to pay out the bridging loan (on the sale of their old home), they will have to pay interest on finance for both properties. If the time the original home takes to sell drags on, this can prove to be very expensive and put family finances and relationships under a lot of pressure.
So, in an ideal world, having your current property sold is the smartest position from which to enter the real estate market.
Buy better: What if I don’t want to sell first?
Even though the pressure of having to sell with a deadline can be substantial, there are reasons some people choose to hold onto their property and make their offers on new properties subject to sale.
This might seem pleasing on the surface, but there are some hidden stresses at work.
Firstly, most vendors consider contracts that are subject to sale of other properties, too risky, and they will almost always choose offers not tied in this way.
Secondly, if you’re trying to bid on a property without having a solid grasp of how likely your property will perform when it goes on the market, you risk being too conservative in your offers (to protect yourself) or too laissez-faire (and offering more than you might reasonably expect to get for your current property).
Our advice in this situation is to at least have a property appraisal done first, and meet with a shortlist of agents you’ll consider hiring when you are ready.
If you include McGrath Real Estate in this process, you can have confidence that you will be given a down-to-earth indication of your home’s value, taking into account your area, the property features, and the current state of the market.
We know, from previous experience, that clients with one of our appraisals “in their back pocket” do feel more confident as they embark upon their house hunting because they can then make educated decisions.
Buy better: Get finances in order so you know where you stand
Of course, nothing quite breeds confidence like having finance ready to go when you’re making offers on properties.
We recommend aloanplus because our broker will listen to your circumstances rather than try to make you fit a loan that isn’t quite right.
Visit aloanplus to start a conversation about how you might get your finances in order to help you buy better in this rewarding world of real estate.