Which is the right way? Buy AND THEN sell? OR Sell AND THEN buy?

Which is the right decision for you? Here is a great article to help you decide.

Real Estate News-Diedre Woollard

How to Sell Your Home and Buy Another at the Same Time

Being a move-up buyer can be tough in today’s market. Although deals are closing rapidly, there’s no guarantee that your new dream home will close at the same time as your old dream home. Selling and buying at the same time is a delicate dance, but it is doable. There are a few ways to pursue this plan:

1. Sell first, then buy. This is perhaps the safest plan, but it calls for multiple moves. In this scenario, you list your home and complete the transaction before purchasing another home. When you sell your home, you put the bulk of your belongings in storage and live in a temporary rental or, if possible, enter into a rent-back deal with your home’s new owner. The advantage of this method is that you know exactly how much you can spend on a new home, and you don’t have to worry about temporary financing. Also, without another home waiting in the wings, you’ll be less tempted to drop the price or to take the first offer that is below the asking price. The disadvantage is that it is a disruptive experience, and you could be displaced for a while if you are home-shopping for a long time.

2. Buy first, then sell. This strategy minimizes disruption. You can move into your new place at your leisure and then take time to prepare your home for sale. The major disadvantage is that, depending on how fast your old home sells, you could be shouldering the burden of two mortgages for some time. You are also responsible for maintenance and security on the vacant home. This scenario works best if your first home is already paid off.

A variation of this plan is to buy a new home with the plan to rent out the old one for a year. This buys you some time with money coming in, but being a landlord comes with its own stresses and responsibilities. You may also need to repair or renovate the home after it has served as a rental.

3. Buy and sell simultaneously. To execute this plan, you need to prepare for all contingencies and to know that if your timing is off, you will face one of the two scenarios listed above. The trickiest bit can be timing the financial burden. One option is bridge financing. This enables you to own two homes for a short amount of time. To do this, you need to either borrow money from family or obtain a short-term loan from a bank or other lending institution to span the time period between when you close on your new home and sell your old one. In essence, you are getting a short-term home-equity loan, also known as a HELOC, a Home Equity Line of Credit, on your present house and using it as a down payment on your new house. You then repay the loan when you sell your first home. It is not easy to qualify for a conventional bridge loan, since you have to demonstrate that you have enough money to pay for both mortgages for an indefinite period of time.

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Homes Are Selling Fast in Arlington

For most people selling their house the second most important thing, after netting the highest offer price, is selling the house fast.

Research done by realtor Brian Block shows that most homes under contract in Arlington and Alexandria have been on the market for less than 60 days.  In some price ranges, it’s as low as 36 days on average.

The only price ranges to average more than 60 days are $700-800 thousand and homes listed at over $1 million.

Of the 1,223 active listings in the MLS in the Arlington and Alexandria only 441 have been listed for more than 60 days, accounting for just 36%.

Virginia Housing Trends
Northern Virginia Real Estate