What Do You Do When You Can’t Find a New Home?
Being in-between homes is more common than you think — we have a plan if it happens to you.
At first, it sounds like a problem any seller would love: Your home sells after only days on the market. After all, the fear of a property lingering on the market, enduring possible price cuts, or low ball offers is what keeps many from selling in the first place. While a quick sale is a reason to celebrate, the challenge comes when it happens before you can find a new home.
While it's not guaranteed to happen to you, this is an increasingly common situation in our current market, which remains hot due to the continued limited inventory that started in April 2020. Though inventory may increase in the spring selling season, there’s a couple of conundrums. One, the home you are selling now has more competition. Two, for every home listed, another home has to be bought... so you have more buying competition as well. Until inventory outpaces demand, securing your next home might likely take a little longer than anticipated.
Still, the upsides of a speedy home sale outweigh the inconvenience of possibly being in-between homes: Less drama, achieving your asking price (or more), and being able to consider multiple offers to find the best buyer for your house. We can help you plan ahead by following these strategies before you list.
Ask about a "suitable housing" contingency.
This contingency is a clause in your contract that essentially states that you won’t finalize your home's sale until you find a new home. Ordinarily, buyers find such clauses to be off-putting because it creates a lot of uncertainty in their own timelines. However, when demand is very strong like it is now, there may be a buyer out there who has a more flexible timeline for their move. (For instance, a family in the market for a home but doesn’t want to move until the new school year starts). We'll discuss it together to see if a clause would make sense for you.
Consider a bridge loan.
One of the reasons sellers panic about being in-between homes is dipping into their savings to cover their temporary living expenses. A way to counteract this possibility is to purchase your next home before selling your current home. A bridge loan is a short-term loan that can cover you in this instance. (It can also add to your home purchasing power by removing your home sale contingency.) The downside is that these loans often have higher interest rates and quicker repayment periods. Do the math and read the fine print to see if this makes sense for your situation. We're happy to recommend lenders who can discuss this option with you.
Look for “vacation” rentals.
We may not be located next to a beach, but that doesn't mean we don't have plenty of vacation rentals around town. Thanks, Airbnb! Finding short term leases can be difficult with the state of today's rental market, but that's precisely where Airbnb hosts excel. Plus, an added benefit of going this route is that the home will likely be furnished so you can leave all of your stuff in storage until you are ready to move into your new home.
Hire an agent with connections.
When it comes to securing a new home in a limited inventory market, sometimes, it comes down to having an agent who knows how to leverage their connections. As your real estate agents, The Parrett Group is prepared to tap into our database of potential sellers in the areas that you're considering buying. Some of our sellers even empower us to tell only our clients about their upcoming listings while they get ready for the market. That means you could have access to homes that aren't even on the market yet! If we can help find potential homes to showcase to you so that we're not only helping you sell your home but ensure that you can buy a home as well, we will.
When you’re putting your home up for sale, it’s easy to let anxiety take the wheel. The fear of selling your home before lining up your next home is one of those worries that commonly come up when the market is hot. However, it’s also one with a few easy solutions — and depending on your unique situation, we may have even more creative ideas for you. You never know if such a scenario may be a blessing in disguise, too. Just think, next year at this time, you may be sitting pretty in an affordable vacation rental in a fun destination, taking your time to find your dream home.