Which Comes 1st - The Buying or the Selling (Classic Chicken and Egg Debate)

As professional Realtors® we are often presented with the classic chicken and egg debate:  “Do we buy the house to move to first and then sell our home?” OR “Do we sell the house we live in not knowing where we will go after it sells?”  We start the dialogue with people who present the dilemma by asking:  “Can you can qualify and afford to own two homes at the same time?”  If the client can’t do that financially, then the question has already been answered.  They will have to sell and then figure out where to go, and that may entail living in temporary housing or renting while determining the next move.

If one can qualify and afford to own two homes at the same time, then the next question is:  “Do they want to?”  Many people cannot tolerate the risk associated with that scenario.   So once again, the question has already been answered, put the home on the market and get it under contract, then go out and purchase a home requesting coinciding settlements in the offer.

Coinciding settlements is where the money that is coming from the sale of the current residence will be applied to the purchase of the next residence.  In Virginia, where we practice real estate, it is a Wet Settlement Act state.  This law requires that the Deed be recorded at the court house before funds can be disbursed to pay off liens and proceeds sent to the owner (if there are any).  Bottom line in Virginia, the owner does not leave after settlement of real property with the funds and thus cannot utilize them to purchase the next home until they become available, thus the necessity of the coinciding settlements clause.

The question on the other side of the coin is:  “Can you tolerate not knowing where you will go if you do sell first?”  This is the scenario that Karen Briscoe and her husband found themselves in over 5 years ago.  As many empty nesters do, they frequently would look at each other and say, “What will we need with all this space once our youngest leaves for college?”  The yard that was so much part of our family life started to feel like the weekend noose – requiring more work than anyone had time and/or desire to attend to.  They had very specific requirements of where they wanted to move next and satisfying those were the priority, which included:  an end unit town home, an elevator or the ability to economically retrofit one (for elderly parents), walking distance to downtown McLean, less than 10 years old and at a price they could afford!

When the Briscoes found a property that met all of those criteria, it happened to be the Friday before Thanksgiving, which whirled them unexpectedly into the entire selling and buying process.  So the chicken came before the egg in that scenario.  Visiting with a professional Realtor® and an experienced lender can assist with making these decisions.

Karen Briscoe and Lizzy Conroy are active and experienced Realtors® in the Northern Virginia, suburban Maryland and Washington DC market place and would be delighted to assist whether for home buying or selling.  Please contact via the means most convenient for you:  www.HBCRealtyGroup.com, 703-734-0192, Homes@HBCRealtyGroup.com.