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Sell First: Some people believe that selling first makes the most sense, and in some cases this may be true. It can also leave the home owner in a bind if they can't find a new home to buy in the short amount of time it takes for their sale to close. Selling first makes the most sense in a buyer's market where there are lots of properties available for sale, and not many buyers competing for those properties. In this case when selling a home is more difficult, it makes sense to leave more time to complete that transaction, and buying should be easier since there is a large inventory of homes to choose from. However, this can backfire if the right house doesn't turn up at the right time. The home owner can be left unsatisfied in their new house, and there is an element of luck to finding the right property in this scenario. Selling first can be even more difficult as homeowners climb the property ladder. They have more experience and more money to spend. They become more picky and specific about what they want in their next house, and it gets increasingly difficult to find the perfect home, especially if it has to be done in a limited amount of time.
It is best to ell first in a buyers market. This allows you to ensure that you get the money you need to buy up and, typically, in buyers markets there is lots of inventory on the market for you to choose from.
In this scenario many buyers will have a plan b strategy. This may include a storage facility for their possessions and a short term rental set up in case the perfect home doesn't materialize in time. Not for everyone but this does allow for a better position for buyers.
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Buy First: If home owners buy before they sell, they are more likely to end up in their dream home, since they can take as much time as they need to find the right property. This strategy makes the most sense in a seller's market where listings sell very quickly and there isn't much inventory to choose from. The problems that can arise from buying first are very serious. Home owners can find themselves backed into a corner, forced to sell at a deeply discounted price, potentially losing thousands of dollars. This can be avoided with a clause in the sale agreement making the purchase conditional on selling first, but many sellers refuse to accept this clause and if they do they will add a 48 hour clause. This clause will allow the sellers to demand you remove your Subject to sale clause should he receive a new offer. This is a heartbreaking situation for some buyers and can lead to tears in some cases as buyers watch their dream home slip away.
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