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For those of you who bought a home contingent on selling your current home, how was the experience? Or how did you avoid this scenario? Please specify the year as I'd like to focus on recent experience. I'm considering this scenario and it makes me cringe.
Unless the house is so uniquely suited to you, I can't see a reason to do it. I did a version of a contingent sale when we moved here, but the house was under construction, so my closing was already long-dated, and I was confident that I would be able to sell my house quickly. We sold and closed on my home sale five months before we needed to close on my purchased home. In retrospect, it was quite risky, and I feel like we were quite lucky that it worked out.
While it may not be possible in your situation, when we moved from the city to Westchester we had already made a concerted effort to have the down payment for our next home already in the bank. We did not even discuss with the sellers that the purchase of their house was contingent upon the sale of ours. We also banked some extra money in the event we needed to carry two mortgages for a (limited) period.
While searching for homes, we ordered a POD to our house and moved as much stuff that we could fit into it and had it hauled away, which would then make our move easier as well as make our current home look much more spacious.
After we placed an offer on our new home, I called my agent for my current home at the time and told him we needed to list and sell quickly. We staged our house with our remaining furniture (which I recommend), took some great photos of the place for the listing, priced it right, and accepted an offer 1 week after the open house.
I think you need to really understand the market in your current area. Where I live now in Westchester, homes can sit on the market for months and months, whereas the area I was coming from tended to have inventory that moved more quickly. You need to be realistic with what you want to list your current home for and accept the fact that you potentially painting yourself into a corner if low bids start coming in and you have to accept a lower number than you had originally planned. You also have to have a lot of confidence with your broker. Also keep in mind that if your current home winds up closing before the closing on your new home, you may be forced to move things into storage which can eat up costs.
In the end, we closed on our first house 2 weeks after we closed on our current house.
Certain parts of the Westchester market move more quickly than others. To be honest in some really sought after neighborhoods having that contingency in an offer puts it half way in the trash. However it is very location dependent. What area would you like to buy in and what area would you be selling? If you are in a market where properties are moving quickly when priced right average days on market is about 40. It might be worth it to sell first and rent a place on a month by month basis until you close on a house. Again the home sale contingency is a bigger deal in some local areas compared to others, knowing which areas you are looking at would help with giving you advice. As Gadgetboy stated above, a nicely photographed and well marketed home can move quickly in certain neighborhoods.
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