Nobody would call buying your first home easy per se, but when it comes to trading up, there are a lot more factors in play for you to consider and watch out for. Don’t list your home for sale until you have all of these confidently squared away.
Right off the bat, the most terrifying thing is potentially being stuck owning two homes, or not owning a home after your sell the home you are currently living in, so the first thing to do is make sure you’re selling at the right time to transfer from one house to another. This gap period can be confusing to balance for some people, and a lot have to resort to inconvenient alternatives.
The Top Six Ways To Lose
1. Your Emotional Attachment and Idealization of a Home
We know this is an exciting and life-changing opportunity for you, but you have to stay realistic, and wary of your current standing. It sounds obvious from the outside, but people develop a strong emotional attachment to homes which can prevent them from forming a clear bridge between what they can actually afford, and what their dream home is. Human error plays a huge role here in hyping up expectations, and leads people to do things like fall in love with a home before realizing that the cost is way out of their league and/or budget. To avoid this, separate yourself from the equation and utilize our realtors to handle the house hunting efforts to match you with realistic homes that are both available, and in your price range.
2. Not Earning That Trade Up Value
The most important part of trading up is realizing how your home can improve, and setting about to make sure those renovations and touch ups happen. This is how you optimize your asking price, and lock down a great deal that can help you shift to a better property. It doesn’t have to be anything massive, as even the smallest changes will result in tangible price changes when it comes time to appraise the house. The important thing to note here is that you should really have this done and finalized before throwing your home on the market and listing it for sale.
3. Clinging To Your Home
It’s natural to be protective of your property, but you have to throw your offer on the table before you can start looking for a new home in earnest. Once you accept an offer to buy a home, you’re at the mercy of any lowball price to avoid the scenario we mentioned earlier about being stuck with two homes. Don’t make yourself race against that move in date, and just work on locking down a sale first, so you hold all the cards and can operate at a pace comfortable to you. Real estate already isn’t easy, and you don’t want to stress yourself out and sell yourself short by trapping yourself in any desperation deals.
4. Not Utilizing A Preapproved Mortgage
This is one of the most frustrating things we see with eager home buyers who want to hit the ground running. Obtaining preapproval doesn’t cost you anything, and can put you at a huge advantage for later negotiations revolving around your budget. Too many people end up having to guestimate their spending limit, resulting in a missed opportunity, or a financial ditch. You also look much more legitimate to a potential seller when you demonstrate your ability to lock down this kind of loan. Make sure you know how much you can spend, and to show the seller you’re serious and have the backing of a serious financial institution to provide safeguards that the deal will go through.
5. Not Getting A Realtor Guarantee On Their Trade Up
We know earlier we advised to sell first, but for some people this doesn’t work, or they struggle to find something to buy afterwards even without the obstacle of selling. Some real estate agents offer to take the full responsibility on for you by guaranteeing to sell the current home while you shop around for the next one. In cases where the home hasn’t been sold yet, some agents can actually buy the house from you for later sale, clearing the house from your conscience, and letting you handle your business.
6. Forming A Disorganized Cluster of Simultaneous Operations
It’s important to remember how many different things you need to happen before you can trade up, and how many people you will actually have to go through to get there. Before anything can get too serious, you have to send in the home and pest inspectors, the loan officers, the estate lawyers, the appraisers, the mortgage experts, etc. This is twice as important since these people will have to facilitate a sale, and a purchase, so the usual leeway absolutely doesn’t apply, and you WILL need to coordinate and work according to their schedules before moving ahead.
In the end working with a professional and having a solid game plan can help you achieve a successful trade up. Whether it is a growing family, a relocation, or just a desire for a bigger home trading up is something that must be thought through to make sure that you get the best value for the home you are selling as well as the home you are buying.