Poll - Would You Be Willing to Buy a New House Before Your Old House Sold?

In this market I would absolutely wait until my present home sold! I am an emotional buyer so it would be extremely difficult if I fell in love with a new home. I have just seen way too many homes for sale for months and months.

I would not because I can't afford TWO house payments. I would have to wait until the old one sold to buy a new one.

Most companies have a relocation agreement and the company buys the house if it doesn't sell in "x" amt of months. Do you have that? Then maybe we would IF we could cover 2 mortgages comfortably for that amount of months.

Otherwise, no, I wouldn't without a contingency agreement that you'll buy #2 for abc IF house #1 sells by xyz date.

I am of the opinion that there is no "O. perfect house"!

I've been in this situation - moving for my husband's job to a new town before our old house sold. We did buy a new house because right when we started looking we found what we thought was the perfect house. So we had two mortgages. For us, it was the worst choice possible. It took almost 18 months for our first house to sell, and paying double mortgages sucked up all of our savings. We almost had to do a short sale on our first house because we simply could not find a buyer for what our mortgage was. I love the house we bought in the new town, but looking back, buying it was a mistake for two reasons. First, we already had a mortgage and hadn't yet sold the first house. So it was a risky move. But the other reason why buying a house in a town we didn't live in was a mistake - we did not know the town well enough. We thought we did - but after living here for six months, we realized we would have chosen a slightly different part of town. I wish we had rented an apartment or house for six months or a year, to give our old house a chance to sell, and to learn more about our new town. That's the advice I'd give to you. It's a pain having to move twice, but you stand to be better off financially if you rent first... and you could be happier with where you end up.

I just did. We closed on our new house 5 days ago. i'm still trying to get my bearings straight from the move and will start fixing up the old house to sell next week. I hope to have it on the market by the mid-end of May.

The main reason we did it that way was that there was no way I could show a house with 4 kids and a dog. Plus the house needed a lot of cosmetic work (painting, carpets, floor refinish) that I was worried the kids would just mess up again if we did it before we moved.

That being said, my husband makes enough money and the old house mortgage is low enough that if we had to carry it forever, we could. But out plan is to rent it if we can't sell it in 6-8 months.

We did it in 2006 and it was a huge mistake. Everyone (as in parents, my co-workers in the finance industry, our attorney, Realtor, etc.) told us to go ahead and do it...that we could take a bridge loan or equity line out of the old house to have money to put on the new house plus a little extra to cover two mortgages, that it would sell quickly, don't worry about it, everyone does this, etc.

Well...we did have a buyer but their purchase fell through right before we closed on our new house so we proceeded with our purchase. It took 10 months and a $50K price drop plus a $15K Realtor fee to sell it. In the meantime, I had to borrow $ from my 401(k) to cover the two payments plus the equity loan for so long. We had to use our tax return, my bonus, and then borrow $25K from a relative to go into the sale of the old house with all of the money that *we* need to pay to *sell* our house. We then needed to do a re-fi under lousy circumstances to pay back the money we borrowed from a relative, setting us at a ridiculously high interest rate, which we were confident that we could re-fi out of in 6-12 months. Great idea, except the market value dropped so we had negative equity...so when we tried to negotiate a lower interest rate because my husband was laid off, we got mixed up in Home Affordable, which ruined our credit and put us many months behind on mortgage payments...then they sold our mortgage to another company for pennies on the dollar and we've been trying to work through a permanent re-fi with the new company for 18 months. In the meantime, I pay $30K a year in mortgage payments and they all go to interest and escrow, not principal. Oh yeah and somewhere along the way we had to convert that 401(k) loan to a withdrawal because we couldn't keep up with those payments so we paid a heavy tax penalty on that.

So...DO NOT do this. It's still very much a buyer's market and there are lots and lots of "perfect" houses out there. If I were you, I would put your house on the market now for the lowest price you can and try to get it sold, but plan on seeing if you can get a renter as well in case it doesn't, and plan on renting in your new location until it is sold. It's not worth the gamble.

foolish people by in a town they don't know before living there...

You rent until you know what it is like and the best places to live and then you buy...hoping that during the time you rent...you house sells.

And what better way to get into financial trouble then to buy a second home especially if you do not have the income for it

If I had the money for it. Most people I know don't have the funds to do this.

I've never been in this situation and I'm not looking to buy or sell in the foreseeable future.

IMO, yes. If I was financially able to, I would buy before selling my current house. I would also try to negotiate with the seller a closing date much later than normal.

There are too many calculated risks imbedded within your question.

The biggest hurdle is finances. Can you afford to purchase another home while the other is being sold? And for how long? 2, 4, 6 months or longer?

If you can afford it, great, you can get the new house totally prepared the way you want it before you move in and that is a very nice way to start out in a new home.

We are doing that right now, but it is the first time ever we have a 3 month overlap and paying 2 house payments.

We will be looking to sell our current house next summer and will buy a new house wherever we move (military). With that being said, we've put aside 12 months of bills for our current house (mortgage, insurance, utilities, taxes). I am worried about owning two houses, but feel much better with our "house savings".

Not unless I could easily afford both mortgages indefinitely.....you never know how long it could take for the other house to sell in this market.

Well, I've bought three houses. And yes, the second and the third were bought before the first and second were sold.

However, I had a large down payment, and the market was hot when I listed the first and the second. Also both times I had a mortgage pre-approval that was not contingent upon selling the current house.

Now, I might do it differently unless I was willing to list REALLY low to be SURE the house would sell quickly. Or unless I had enough cash leftover after the downpayment to double up on mortgage payments if I couldn't sell/rent the current house.

:)

We've done it twice.
See if your husand's employers will cover at least the principle of the old house while you are living at the new.

Do not cut off water or electric while it is still on the market. Set the air high, like 80*.

Make sure you can afford both mortgages and utility bills.

Do you have an aggressive real estate agent? We had one who didn't care, then we fired her and got another who had our house sold in three months, after it had already been on the market for over 6 with hardly any showings. She actually had an offer for us Christmas Eve.

We did.
The 1st house is paid off - no mortgage.
We lived there 17 years but the area has built up so much we have no desire to ever move back there.
We're renting it out so that the rent pays for taxes, upkeep and a good portion of the monthly mortgage payments on our 2nd house.
My husbands job relocated, my job is portable and we're 4 hours away from the old house.
A relator friend of mine handles the property management for us.
When we can sell the 1st house to pay off the mortgage of the 2nd house, then we'll do it.
It should only be a few more years till property values bounce back to what they were in 2006 and then we'll be mortgage free once again.

Probably not. I'd hate to lose both houses --the two foreclosures on my block are the result of the owners owning two. They even had the first houses rented out!

Perhaps you could rent out your current house and then buy the new one. I have some friends that tried to sell their house literally for years and had no luck - they finally bought a new house and ended up renting their old one very quickly.

They make fairly rash financial decisions so I don't know if it's the best advice but could work if you're in a pickle

In this economy I would not. Not unless I could actually afford to have both at the same time. How long your house will take to sell and how much you actually get for it are big unknowns. Renting your old place is iffy but crunch the numbers. I know in my situation the amount of rent i'd be able to charge would be barely enough to cover mortgage taxes and insurance. That would not cover the cost of me traveling to take care of it or hiring a property management company.
I would rent to start with in your case. This will also give you a chance to get to know the area before committing to buying a house.

No. Not in this market.

We relocated from FL to OH last year and decided to rent a house in OH until our FL house sold. Besides owning the FL home, I was not comfortable buying until I actually became comfortable with the area. I never even visited the area we are living in until moving here. If I were to own, I would want to know the area, be sure the schools are good etc. I am not sure about GA but the FL market is flooded. My house did not go quickly.

My inlaws relocated around the same time as us but bought a new home in their new area. 15 months later, my FIL s still paying mortgages on both properties. It is a buyers market out there and the offers are low. Good luck.

Only if we could afford both house payments. We actually did this 12 years ago. We owned a house in a neighborhood we wanted to move out of, and we found a farmhouse on some acreage that was for sale cheap. It was such a deal that we really didn't want to pass it up. We could afford both payments, so we jumped on it. We had two house payments for 7 months . . . not fun. It was the right thing in the long run, though. We haven't seen a deal on property like ours since then, and we love our farm! We never would have done it if we couldn't have afforded the two house payments. Once our house sold, it was like getting a huge raise!

I wouldnt unless I knew I could afford all the different scenarios.
I'd rent a cheap little studio apartment to give yourself time to find the right house to buy if you have to leave your current place and move to a new town.
Since it's mandatory for his job, would his employer set you up in an apartment temporarily till you found a new home? Have you asked?

We did.

The housing market in Chicago is sh*t, and has been for years.
We've rented our old condo to make up the mortgage payments.
We list it each year in an attempt to sell it, but it's just not going anywhere.

We needed a bigger space for family, so we had a time limit to get out of the old place. Luckily, we are able to afford the new down payment and old mortgage payments while everything was in transition.

Been there, done that. Since you're in a position where it's mandatory, it sounds unavoidable. Be prepared to rent your house out until you are able to sell, best option is an official rent-to-own agreement. Might want to use a rental co. since you won't be nearby. In our case, we bought a house down the road & on & off rented it out until we sold it 4 years later. Very financially draining. Hope you have better luck!

I have in the past because we knew we were going to rent our first home, and at the time both my husband and I were working and we had no children. This last time, I was not working and we have 3 kids, so trying to afford 2 mortgage payments was just going to be too tough for us.

If I were in your situation and moving to a new town... I would NOT buy a new house until I settled in and found a neighborhood I loved in the new town. It sucks to rent for any period of time but when moving to a new town, I think it is wise so you can find what fits you best as far as schools, neighborhoods, etc.

That said, when we started building our first home, our home sold 2 months before the new one was finished and we ended up with things in storage and in a tiny apartment for about 8 weeks.

When we built the 2nd house, we did not have a contract on the one for sale but before our house was ready for us to move in, we did have a contract and were able to stay in the older home until the new one was completed. It worked out perfectly.

You just never know how the market will be. Good luck on your move?

Not a snowball's chance in hell would I do this. When we were transferred from Houston to Kentucky, we rented an apartment for 6 months. We wanted to be sure we would be happy with the area. We bought and lived in that house for 12 years. Sold it, and built a new one. Yes, we had to move into an apartment but I would rather do that then pay for two mortgages. I am not a gambler and in this market to me it is financial suicide and I'm not willing to do that. When we were transferred back to Houston, I had three days to pick a house. I knew the area I wanted to be in so we went ahead (after selling our home in Kentucky). We were lucky, that house sold in 12 days. I ALWAYS sell before I buy!

We currently own two houses but not because of buying and selling, marriage has that effect as well. The second house has no mortgage so all we pay for is minimum utilities, taxes and insurance.

Two years that freaking thing hasn't sold and we are asking wayyyy below market. Thing is it is as is so you have to find someone who wants to flip a house, no one wants to flip a house.

The other thing is we had people all over wanting to buy it until we were willing to sell. They just disappeared or took our situation to think we would just give it away.

So looking at this I wouldn't, there are just too many variables beyond your control. The only way I would even consider it would be a situation like ours where you can afford both homes without much stress.

No, I wouldn't.. What if the other house doesn't sell for months, or with market years? I wouldn't take the chance.

We just moved a year ago and would not put ourselves in that stressful position. Our worst case scenario was to live in an apartment or duplex until we found something else. Luckily, we priced our home right and staged it well that it sold in three weeks. There were so many homes on the market including brand new homes that we didn't have to build, so that made the process much easier as well. Good luck to you!
HTH,
A.

No way, why cause needless stress on myself

No - rent instead if you must, but don't own two houses at the same time.

Sorry,
Dawn

NO.
I had a friend who did that (because she found the perfect new house) and she still hasn't sold her old house 1 yr later! She was forced to rent it out which she didnt' want to do, plus just the strees of still being liable for it.

Nope. Not a chance. That is, unless I won the megamillions lotto and didn't need to EVER sell the current home. Otherwise, this falls into one of those categories that another poster was asking about earlier today. You know... those people with "bad luck". Um.... make wise choices and you are less likely to have bad luck.

Nope, but in our case it wouldn't be financial viable or, at this point, necessary.

It depends on the housing market where you live. We live in GA and had ours on the market for over a year and it didn't sell. The house next door to mine has been on the market for 3 and still hasn't been sold. My neighbor has reduced the price as low as she could go and not have a loss. Still no takers.

If you can afford to pay the mortagae on two houses then go for it. If you can't swing it, I would wait. If you rent your place out and the tenents don't pay on time or don't pay at all, you have to be able to handle that. If the destroy the place you may have to spend a lot of money getting it ready to new renters. I have friends that were hit hard in this area, so I convinced my hubby to get stay put. We didn't need to sell our house because we were relocating or any thing like that. We just wanted a different house.

I see this happening every day. The only other choice is for hubby to rent a hotel room in the new job town indefinitely and the family live in the house. It took one family almost a year to sell their house in Shawnee and dad lived in a town nearly in Kansas and drove home on the weekends.

Another family is doing this right now, he is already living in Texas working his new job, different company, and she is painting and cleaning in preparation to put the house on the market sometime this month. She would not move until school was out so the kids could finish their year out. They are moving in June or July regardless of the status of this house.

If a person moves due to a transfer within their same company they often get their house bought by the company if it doesn't sell within a time period. This is to help the family get established and on their feet. I think that is a nice way for a company to treat their employees they are inconveniencing.

I think that another option is to just rent it out and go start your new life in the new city. Hopefully the house will sell for near the asking price. I think that you do need to be careful about the "demands" you put on your Realtor. If she has no wiggle room in the price you are not going to sell the house.

I don't know anyone who has sold their house in the past 5 years who got even 50% of what it was worth 10 years ago. Expect to sit on it for some time or take a loss.

We have bought before selling, however, we were moving only about 25 miles away. In addition, the house we were selling was at the low end of the market, so i knew it would sell fast even in a depressed market (2009). I just priced it right and we had 4 offers within a month. Now if I was moving into a whole new town, there is no way I would buy there outright. I would definitely rent first for a year to get a feel of the town, schools, neighbrohoods etc. If I was totally down with my old town I would sell, however, I think if I could make back the mortgage/taxes/insurance/upkeep in rent, I would strongly considering renting. If it cost too much money to keep the old. i would sell.

You should really consider renting it. Seriously with the amount of foreclosures happening really good, decent families need houses to live in. If your on the north side (roswell area) I could give you the real estate agent who helped us rent ours. It cost one month of rent to have her do it. We only live an hour an a half away so we didn't need a property manager but one of those would have cost %10 of rent a month and then you do nothing. The manager will directly deposit the $ minus their fee and then they deal with all the hassles that come with renters. Although in the 3+ years we have rented ours to the same women and her kids we have only needed to call a handy man one time to go over there and fix something (Andy on call is awesome).
If you rent you can wait to sell until the market comes back a little. We don't make any profit from the rental but got several thousand dollars in deductions on our taxes from it. If you do go this route, make sure you hire someone to do your taxes for you, they always find more deductions than you can think of. We use H&R, they will guarantee their work (ie you get audited they have to send a representative and they will cover up to ??? I think 50,000$ (might be a slight fee but knowing I won't have to pay if they screw up worth the cost). By the time were ready to sell (5-6 years) we shouldn't lose any money on it.
I know the prospect of renting seems hard. But it really isn't. Good
Luck!