Mia Lennon
Phone
(406) 641-0051
Email
[email protected]
Buying and selling a home at the same time can be a challenging juggling act that often comes with a tremendous amount of stress. The thought of coordinating two complex transactions, dealing with financing, negotiations, and timelines can leave anyone feeling overwhelmed and downright confused.
However, with careful planning and some knowledge under your belt, it is possible to navigate a Big Sky Montana real estate transaction with less stress. Consider this your comprehensive guide with valuable tips that will help manage the process of buying and selling simultaneously easier.
Consider the options
The first step to a stress-free experience is to understand the options that are available when buying and selling simultaneously in Big Sky. You can buy first and sell later, sell first and purchase later, or purchase and sell in the same transaction (concurrent closing).
Which combination is best for you will depend on timing, finances, future plans, and personal preference. It’s important to note that there is no right or wrong decision, as each comes with its own pros and cons.
Pros of buying first and selling later:
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You'll have a guaranteed place to move into
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Less pressure to make quick decisions
However, you may risk a market change in the selling price.
Pros of selling first and buying later:
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You know how much equity you can put toward a new home
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You can roll equity into a new purchase with ease
The con with this option often comes down to timing. What if you sell first but can't close on a new property until later?
Pros of concurrent closings:
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The purchase and sale happen within days of each other
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You may be able to use back-to-back escrow, where proceeds from the sale go directly toward the new purchase
Concurrent closings are the best-case scenario for many buyers and sellers, but they can go wrong, sometimes at the last minute.
Create a backup plan
If it still feels confusing, don't worry. No matter which combination of buying and selling a home at the same time you choose, there are still more options available.
The first option is a rent-back agreement. Technically it’s called a use and occupancy agreement (U&O) and is negotiated between the buyer and the seller. With this option, you can sell first and buy later. When a buyer agrees to this option, they agree to purchase the home while you rent it back for a certain amount of time. The U&O will give you more time to find another home while still providing the funds from the sale.
Another option for selling before purchasing a new home is to find temporary housing. While this will mean double moving costs, it can be one of the least stressful options. Knowing you are planning to move into a rental provides more time to find a new home, so you aren't rushed to accept or place an offer.
Contingency, or settlement contingency, sales is the third option when buying and selling at the same time. This is best utilized when you must sell your home before closing on a new property. Settlement and sale contingencies help buyers avoid having two mortgages at the same time. They can be negotiated to make the closing of your existing home contingent upon your relocation.
Another choice to consider is to rent out your old home while it is still listed for sale. With this arrangement, you'll still be on the hook for two mortgages, but the rental income can help offset the costs until you can sell the old place.
Prepare for listing
The search for a new home can be so exciting it's easy to overlook the process of preparing your home for listing. The top priorities are:
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Minor repairs and updates
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Cleaning and decluttering
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Fresh interior and exterior paint
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Refreshed landscaping
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Professional staging and photographing
As a general rule, prospective buyers want to see neutral interiors, stainless steel appliances, storage space, outdoor living accommodations, and smart home technology features in 2023. The overall goal is to showcase your home's best features with proper staging techniques, lighting, and simple yet elegant touches.
If you aren't planning to sell for a while still, you can complete a few necessary tasks anyway. While it isn't required, paying for an inspection can pay off in the long run because it will save you from unexpected, last-minute repairs. Whatever is right for your situation, the preparation for listing is critical, as it will affect the way prospective buyers perceive your home.
Find the perfect agent
So much of the stress that comes with buying and selling is alleviated when you find the right agent. A great agent will be sensitive to your unique lifestyle and needs. They'll consider your desires, negotiate, and advocate for what is best for you.
When looking for a real estate agent, start by conducting an online search. Scour through the online reviews and testimonials. Look for professional, experienced, tech-savvy agents who can deliver a comprehensive marketing approach. Then reach out to schedule a consultation. You can get to know the agent at the consultation and speak in-depth about your goals.
Once you've chosen an agent, they can help you understand the local real estate market. So far in 2023, the Big Sky Montana real estate market has remained a buyer's market, but a great local agent will have a better grasp on trends and changes than anything else can.
The right real estate agent can also assist with preparing your finances. Of course, you'll need to set aside funds for unexpected closing costs, inspections, unexpected repairs, and more, but what else? The options for financing include 401 (K) and investment loans, traditional mortgages, home equity, and bridge loans. This will all depend on a host of other factors, including whether you choose to buy first and sell later or sell first and buy later, but trying to figure this out without a great agent can pile on the stress.
When you're ready to consult with the right agent, reach out to Mia Lennon for all your Big Sky real estate needs and more.