Buy Or Sell First?

Know Your Local Housing Market

An article by Jamie Wiebe, Realtor.com®

Before you start seriously searching for a new home—or put your current home on the market—make sure you have a solid understanding of the housing market in your area (and the area where you’re planning to buy). Is the market weighted toward buyers or sellers?

Should you buy first, then sell—or vice versa? Both have their risks and rewards. Selling first makes getting a mortgage easier, but it also means you’ll need to find a temporary place to live. Buying first means moving will be easier, but it also skews your debt-to-income ratio, making it harder to qualify for a new mortgage—not to mention the difficulty of juggling two monthly house payments.

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Current market condition is applicable to many home owners who are planning on trading up or down as their homes no longer fit their needs. If a home seller is not planning to keep 2 mortgages, he/she would want use the equity from the sale of their home to buy a home that is more suitable.

evaluation1.pngFor a home owner who can qualify for a mortgage and wishing to keep his/her existing home as a rental property, the process works differently. Before starting the house hunting process, the home owner should get confirmation from their mortgage lender that financing is available for the home owner to buy another home.

All Canadian banks and mortgage lenders have their rules when dealing with home owners carrying 2 mortgages. If a home owner has substantial equity on his/her home, and the family income plus the rental income can adequately cover the mortgage payments for the 2 homes, financing a second home purchase may not be a problem. Find homes for sale on the MLS® System.

Whatever your situation, you are welcome to contact James at 604-721-4817 for a discussion to plan your move and act accordingly.

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