First time buyers are at a great advantage when it comes to buying a home, since they only have to plan for the buying process. If you don't have a home to sell, you can be nimble and quick on the draw. But what if you do have a home to sell before you can buy a new one? What are the best steps to buying and selling in short order?
First thing’s first: you have to find a good Realtor who truly understands the local San Francisco real estate market. A skilled real estate agent will know if the real estate market is hot, cold or in-between, which neighborhoods will fit your budget, and how to get you the best return on investment for the house you are selling.
For example, in a "softer" market, buyers have the advantage since there is a larger supply of houses for sale leading inevitably to (slightly) more reasonable prices. This is San Francisco, after all! Even our down markets can have limited inventory and multiple offers on property. But when the market is hot, like the current San Francisco real estate market, then selling your home may be the easier part of the process.
Once you’ve found an experienced real estate agent who understands your positioning in the real estate market, you will determine which of the following courses of action will work the best for you and your budget.
If you’re in a position to buy a new home before you sell your current home, you’ll have the advantage of being able to take your time with the buying process. You can write a clean offer on the home you want and you only have to move once. In the current San Francisco real estate market, this method is pretty ideal, if you have the cash to spend on a new down payment.
The disadvantages include having to juggle two mortgages and possibly obtaining a bridge loan which can be priced higher than the typical home loan. Another disadvantage is that although we can guesstimate how long it will take to sell your current home, there is no guarantee, and it could take longer than anticipated.
The other option, if you want to buy before selling without having two mortgages, is to make the purchase of your new home contingent on the sale of your current home. Unfortunately, few San Francisco sellers are interested in these types of clauses, but if it worked, it would be a great way to go.
In today's San Francisco real estate market, you can expect to sell your home relatively quickly and, depending on when you purchased, with an excellent return on your investment. If you choose to sell your home before buying a new one, there are some major advantages. One, you will know exactly how much money you have to spend and two, you will avoid the sting of double mortgage payments. And, if you opt not to move out, you only have to move once. Often, we can negotiate a "rent-back" on your behalf which means that you can stay in the property for 30-60 days after the close of escrow. Wouldn't that be nice?! Contracts like these need to be negotiated carefully; our team has experience with rent-back agreements, so we'll help you through the process.
So why would you choose to move out in order to sell the home? Vacant, professionally staged homes will almost always sell quicker and for way more money. You could end up with an extra ten, twenty, hundred thousand dollars in your pocket if you choose to move out and fluff the home for market!
If moving out is not possible, don't worry, there is plenty you can do to prepare your home for market. Many professional home stagers will do what is called "partial staging" where they help you decide which furniture and personal belongings should go into storage and then supplement the home with their collection to create as close to a fully staged look as is possible. Keep in mind that it will feel like you are living in a hotel room and the property must be kept in pristine condition and be available for regular showings. Have pets and kids? The more people, things, and pets you have, the more challenging, but not impossible, partial staging can be. Our Keller Williams San Francisco SFhotlist Team will guide you in making the best choices on whether or not to move and how to stage on your own or with a professional's help. We'll create a strategic plan for your personal situation.
Let's say that after weighing the pros and cons (and after consulting with us), you decide it makes the most sense for your convenience, sanity, and overall return on investment, to move out. Where do you go? Most of our clients choose to go into a rental so they can patiently shop for their next home. There are short-term and long-term options. Sometimes, we hear of good leads through our network. There's also VRBO and AirBnB. And for some, there's mom's house across the bay!
Our team will take a multilateral approach to your real estate needs. Our listing specialist, Danielle Lazier, will work with you on the sale side while our team of buyer specialists will focus on your next purchase. We want you to be educated up-front about both sides of the move so you feel armed and ready for success.
Are you looking to buy or sell your home in San Francisco? The SFhotlist Team, along with Keller Williams San Francisco, has the experience required to negotiate any type of real estate contract and get you the best return on your investment. Don’t hesitate to reach out--let’s talk!
-DL
