Market Conditions in 67219>Question Details

Dehager, Both Buyer and Seller in 67219

Should I start building a new home before I sell my current home?

Asked by Dehager, 67219 Sun Dec 20, 2009

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This should be an easy thing, yet sometimes becomes difficult. I agree with all the answers, there are many variables involved. Established builders will start building your home contingent on you selling your current home and then release you from your contract if you can not sell, but it can be heart breaking to see "your" new home go if you are not ready to buy. On that same note builders may require you pay up-front for extras and overages that may not be refunded unless the builder can sell the home to someone else who is willing to pay for the same extras. Of course the best situation is to go into a new build without a home to sell. If you can't pre-sell your home at least make sure you have a good agent and do not over price the home you are trying to sell. Another option may be to turn your current home into a rental, but you will need to check with your lender to see if you can still qualify this way. Good Luck :)
0 votes Thank Flag Link Wed Feb 23, 2011
Would you buy a new car without trading in your old car first?
(ok, my old car goes to the junkyard, but if it had payments...)

You want to get out of one payment before you get into another one.
If you do not you end up with 2 payments. Even if you can afford it life gets tougher to feel free in.
The one house eats much of your free income. If you only had one house payment you would feel free to go to the movies, eat out, maybe even buy a new car. But when you end up with 2 payments all of your free money is gone.

It is possible to be foreclosed on 2 houses if you end up with both and can not afford to pay for 2.

(CONCLUSION)
If you can not afford 2 houses and do not want to rent one out sell the old then buy the new. Otherwise your finances will not be as liquid as you want. They will be frozen by both payments. It can take months or years to sell a house. You do not want to risk that.
0 votes Thank Flag Link Sun Dec 20, 2009
Arre you qualified for a mortgage without having your current home sold?
That's a good place to start in answering your question.

If you need to sell first , do you have a place to stay while the new home is being constructed?

Most people would have greater peace of mind by selling the home first, then beginning construction. The only obstacle would be finding a place to live short term while the new home is being built

Good luck...
debbie Rose'Prudential NJ Properties
0 votes Thank Flag Link Sun Dec 20, 2009
Depends. Do you need to sell your home to buy the new construction? Are you carrying a mortgage on the current home? Can you afford the build without selling your current home?

What will you do if your current home sells and your new home is not complete? Building could be 4 to 6 months or more. What will you do in between the sale and completion of the new house?

Lots of things to consider. Look at all you options, needs and finances to figure out which is the best way to go.
0 votes Thank Flag Link Sun Dec 20, 2009
Are you building in a subdivision and do you have a contingency clause that says the builder can sell your home to someone else if your home doesn't sell by the time the home is complete? I do not recommend building another home until you have sold your current home for a several reasons: 1) You do not know how long it will take your current home to sell, 2) You do not know much your current home will sell for, 3) If your current home does not sell in time, you will end up selling your home for much less than you wanted or you could lose the new home 4) You could end up with two mortgage payments. Also if you are building in a subdivision, you will pay full price when you build a house. If you wait until your current home sells and you can find some new homes ready to go then you may be able to negotiate on the sales price. Even if you want to build your own home, it is better to sell yours first even if you have to move to temporary housing for a while.
0 votes Thank Flag Link Sun Dec 20, 2009
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