But if you’re thinking of selling, which route should you take: sell first or buy first? The Ontario Real Estate Association (OREA) recommends you look at the pros and cons of both options, and hedge your bets.
Going this route, you’ll know how much money you have to spend on your new home and be able to make firm offers on homes you are serious about buying.
However, you may have to rent or make other arrangements until you find your next home. (In some short-term situations, the new homeowners will allow you to rent back your old home, provided you cover their costs.)
It’s also important to understand the rules around the portability of your mortgage. This option lets you transfer the interest rate and all the existing terms of your current mortgage to your new home (subject to a credit review and property appraisal).
“To sellers, I advise including a condition that says they will sell their home only if they find a new home within a certain timeframe,” OREA president Ron Abraham says in a release.
This option can be a bit risky. If you buy before you sell, you may have to finance both homes and carry extra debt until you sell the old home. You may also feel pressured to sell your current home at a reduced price in order to align the closing dates.
But you’ll only have to move once and can avoid putting furniture in storage.
This strategy can often work in a “hot” market, where you’re better able to compete with multiple offers and get the home you want, but keep in mind that the Ottawa market is flat at the moment.
If you’re thinking of going this route, Abraham also recommends conditions in the offer.
“In the event that they do not sell their current home, they won’t be obligated to buy the home they have an offer on.”
For more information, check out howrealtorshelp.ca.