In a perfect world, you'd list your Santa Barbara luxury real estate for sale, close the deal, then take all the time you need to find your next home while your buyers wait patiently. Unfortunately, our world isn't perfect, and in most cases, if you're selling your current home, you will likely need a new property to move into once it sells. Often it only makes sense to buy your next home simultaneously, so you have somewhere else to move straight into.
This process is the ultimate balancing act and requires careful planning and timing to avoid complications and ensure the whole process goes smoothly. Here are some expert tips to address questions arising when buying and selling your home simultaneously.
Understand your finances
The first thing you need to do when selling and buying your Santa Barbara home simultaneously is to ensure your finances are in order. To get an offer accepted in today's competitive housing market, you'll either need to buy the house in cash or be fully preapproved for a mortgage to finance the home, without any conditions from a lender that your existing home must sell first.
Since selling and buying a home depends on several external factors, which can be challenging to control, you could end up with two properties. The amount of equity in your home, the liquid cash you have or need, and the loan products you qualify for can affect your ability to buy and sell your Santa Barbara home simultaneously. Reach out to your financial planner and mortgage lender to weigh your options and see what's feasible based on your financial situation.
Understand the local market conditions
Before you search for a new home or list your current Santa Barbara luxury real estate for sale, make sure you have a solid understanding of the local housing market. That's because the state of the local real estate market often plays a critical role in correctly timing your home purchase and sale. Knowing what market you're in can help you set the right expectations before shopping for a home or listing your Santa Barbara luxury real estate for sale.
In a buyer's market, more homes are available than people looking to buy, making it much easier to find your new home but more challenging to sell your current one. However, in a seller's market — like the Santa Barbara real estate market — more buyers are available, which means you can be more selective about which offers to consider. You'll likely sell your current home more quickly than you can find a new one. Your Santa Barbara real estate agent understands the local market conditions and can help you strategize the best way to pull off a simultaneous home purchase and sale.
Work with an experienced Santa Barbara real estate agent
Navigating the complexities of selling and buying your home simultaneously will be far easier if you work with an experienced Santa Barbara real estate agent that can handle both deals, especially if you're buying and selling within the same area. Using one agent to facilitate the sale of your current property and find and purchase your new home can eliminate the stress of communication between multiple parties while ensuring everyone stays on top of deadlines and requirements.
A luxury real estate agent can help you with:
Pricing the home. Setting the right price for your Santa Barbara luxury real estate for sale is crucial — if you price it too high, your home could stay in the market longer, and if it's too low, you risk not getting as much as you can for the property. Your Santa Barbara real estate agent will run a comparative market analysis to determine a competitive pricing point that speaks to your home's value and what it offers without deterring a considerable portion of your buyer pool.
Staging. One of the most important parts of selling a luxury home is staging the property so potential buyers can picture themselves living there. Your real estate agent can guide you through staging your home. You might hire a professional stager who will offer advice on decluttering, enhance the property with appropriate furnishings, and help you highlight your home's most exclusive features.
Marketing. A top Santa Barbara real estate agent will have a marketing plan that's specific and customized for your home. They may suggest professional photography, videography, and full-color brochures; craft a narrative about the home; coordinate tours, open houses or special marketing events; and boost online and social media exposure.
- Hire a home inspector. Hiring a home inspector before listing your Santa Barbara luxury real estate for sale is crucial to getting ahead of anything that can slow down the selling process. A home inspection helps you find potential issues, so you can get repairs done well ahead of time instead of waiting for the buyer's inspector to uncover them for you. However, be careful not to commit unnecessary time and money to pricey renovations that could stall you for an unpredictable time. Your real estate agent will recommend the repairs and upgrades that are worth your time and investment.
- Look for your new home. When you sell your current home, you want to find another house quickly and get it under contract. Your real estate agent can help you scout available inventory in the neighborhoods and communities you like before listing your current Santa Barbara luxury real estate for sale.
Place an offer
When you get an offer on your current home, have your Santa Barbara real estate agent make an offer on the new house. You will need to structure your dates in the contract to allow time for unexpected delays and have as limited risk as possible. If you're confident that your Santa Barbara luxury real estate for sale will sell quickly, you can request a closing date extension of your new home past the typical 30 to 45 days to a 60-day closing.
But if that isn't possible, you can take advantage of Santa Barbara's hot market and sell your home with a rent-back agreement — most buyers will agree to a delay of 30 to 60 days. A rent-back agreement allows you to stay in the house past the closing date while you search and settle on your dream home. Buyers aren't obligated to accept your rent-back contingency, though. In essence, you're asking them for a favor. And in a competitive market, buyers are often flexible with sellers if it means their offer gets accepted.
Another option to fill the gap between selling and buying is to include a sale of a prior home contingency. For most homeowners, this is a perfect strategy — you put in an offer on a new home that states that closing depends on your current home's sale. A sale contingency will buy you time and protect you from the risk of having two houses, but it's a risky move, especially in Santa Barbara's competitive market. A seller will more likely go with an offer without any contingencies. Your Santa Barbara real estate agent will advise you on whether to include a contingency on your offer.
Get the timing right
The easiest way to move directly from your current home to the new one without looking for temporary accommodations is to use the closing date to your advantage. If possible, try to have the closing date on your new home fall on the same day as the closing on your old one — or at least within a few days.
For example, you can close on the Santa Barbara luxury real estate for sale in the morning and close on your future home in the afternoon. However, banks can take up to two to three days to transfer funds, and those transfers are usually done before 3 p.m., so don't schedule your closing on a Friday. Having this buffer in your schedule will help you close the sale of both your houses as planned.
Have a backup plan
While it's possible to sell your current home and close on your next home on the same day, things don't always go according to plan. Remember buying and selling your home simultaneously will require perfect timing on three different timelines — yours, your buyer's, and your seller's — which can be hard to achieve. If you close on your Santa Barbara luxury real estate for sale before buying another, you will need to find alternative accommodations. This could mean finding a temporary rental, staying in a hotel for a week or two, or putting your property in storage until you find your perfect home.
Work with Stephen MacFarlane to buy and sell Santa Barbara homes
Buying and selling your Santa Barbara luxury real estate for sale simultaneously may seem like a challenge. Still, with the help and coordination of an experienced Santa Barbara real estate agent, you might be able to sell your current home and close on your next home on the same day.
Stephen MacFarlane is experienced in dealing with the timelines and requirements of simultaneous buying and selling. He can guide you through the process, shortening the transition timeline and smoothing the move to your new home. Contact Stephen MacFarlane today and let us help you list your Santa Barbara luxury real estate for sale and get started looking for your dream home.
*Header photo courtesy of Shutterstock