The way you handle Buying and Selling at the same time all depends on what type of market we are dealing with, your plans, and your motivation. Most people search the MLS for a new home many weeks before they are ready to purchase one, usually still have a house to sell and are not 100% sure on what they want to do.
A good idea is to talk to your agent and get set up on an email that send you listings that fit your criteria right when they hit the MLS – this will keep you apprised of what’s for sale. You can email me here with your criteria and I can set you up on search no problem.
So what happens if you find that house you really want and would like to put in an offer and still have a house to sell? First, you talk to your Realtor and write the offer including your Subjects and terms of the sale, which may include a home inspection, a title search, a review of the Property Disclosure Statement, financing approval etc.
Here is the kicker: in your offer you also need to add the Subject that gives you time to sell your home called Subject to Sale of Home…easy enough? Not exactly, you see, this Subject to Sale needs to be accepted by the Seller, and depending on their situation they may simply say no and wait for an offer without the Subject.
Another kicker: the Subject to Sale needs to be accompanied by a Time Clause – the Time Clause is usually 24 or 48 hours but negotiable, and will come into effect if the Seller receives another offer that they would like to accept.
*TIP: If the Seller accepts your offer with the Subject to Sale they will continue to show the property to potential Buyers because not all of your Subjects have been removed. No firm deal means the Seller can still get another offer!
Moving on, let us say that the seller does get another offer and accepts it. The Seller will now serve you with the Time Clause and you have X amount of hours to remove all Subjects. This is where you usually have to let go of the house you thought could be yours…sometimes this is a sad and defeating situation and all that time and money you spent on removing the basic Subjects gets lost. This is where the risk comes in. During the process you still have to remove all the other Subjects that are in the contract except for the Subject to Sale which may mean alot of time and money spent. There are ways to minimize costs but those will have to be discussed with your agent as each transaction is very different.
*TIP: You’d be crazy to remove the Subject to Sale of Home if your house wasn’t actually sold! I have seen this happen once where the Buyers removed the condition before actually selling and luckily all came out well but this is a HUGE RISK…HUGE!
This was one scenario where the Buyers started looking first without being ready to sell but there are other scenarios that call for a new set of tactics and strategy. It is always best to leave it to the professionals to write contracts, time out dates, negotiate, and MAKE THINGS HAPPEN!! Remember it usually takes a good week or longer for an agent to prepare your home for sale properly and it’s all about the first impression so everything needs to be ready for that first day on the market.
My advice for those wanting to move right now is to get the selling of your home process started while you are casually looking, and try to get that home on the market before you pull the plug on a new house. Many times the process I wrote about above ends in disappointment and that is the last thing we want.