So You Are Thinking of Moving Up

By
Real Estate Agent with GreatWest Realty DRE# 00827565

 

 

You were single when you purchased your first home.  It was small, but comfortable.  And because you were leading the life of a young professional, and because you had an active social life, it was your perfect "Man Cave." 

A couple years went by, and you met HER.  She became your Mrs. - You two remained in your small, but cozy home. Although the color of the new drapes and furnishing changed the décor of your bachelor pad, into a more domesticated scene, life seemed blissful. 

The months and years continued on, and before you knew it, a baby son, Jonathan, was born.  The little house still worked, although you gave up the room designated as your office, so it could become the nursery.  

In no time at all, baby Samantha came along.  It was then, you realized your family, was in need of a larger home, with more bedrooms and a yard big enough for the kids to play.  Your lifestyle had changed from when you were single, getting off work and spending time in the city with your peers.  Your peers now, were also married, had families and were moving to the suburbs.  They were acquiring homes with patios and barbeques in the backyard.

You realize that over the past seven years since you bought your first home, that it is time to move onward and upward in the housing world.

Here are some points to consider first, and mistakes to avoid:

Before the housing crisis came along, that we are currently experiencing, trade-up homebuyers often would put their existing house on the market, and then begin their search right away.  Some did it the other way around.  They found the house of their dreams, and then immediately listed their existing home.  Their agent would write contracts for the new home, contingent on the old house selling.  The contingency carried a "kick out" clause that allowed other buyers to step in if they couldn't sell their house within 72 hours.  In today's market, these types of offers are occurring much less frequently.

Another method used in the past was via a "bridge" loan.  Up until a few years ago, I did a lot of sales using this method.  A lender would loan an amount on the existing house, in order to close on the new house.  The danger was the client would be required to make payments on two houses until the first home sold.  Fortunately, most clients understood the importance of pricing the home well, they were selling.  They also did a good job getting it in great shape for marketing.  This facilitated our getting their first homes quickly SOLD. 

A pitfall can come when a client wants to use "fictitious pricing" on the property they are hoping to sell.  This usually happens when they wrap their heads around the idea they need to get a certain cash amount from their existing home, in order to reach their objective of getting themselves through the door of their new house.  Overpricing your existing property will likely cause it to languish on the market longer, costing you more in the long run.

Still other clients decided to keep the first house as a rental.  This often works, if they have enough cash and/or financial strength to qualify for the new home as well.

Do not waste time looking for homes above your price range.  Get pre-approved for a loan, so you do not spin wheels looking at properties for which you cannot afford or qualify. Find a good real estate professional that you find knowledgeable and compatible to search for you.  You will be surprised at how much time will be saved.  Often buyers feel they can search on their own via the Internet.  They would also be surprised to know status of many listings on the Internet, aren't current or correct.  There can be pricing differences, and homes may have already gone to "pending" or "sold" status.  

When  you connect with an experienced real estate professional, and speak with a qualified lender who can provide you with options for financing and pre-approval, you will likely be far more successful in obtaining a comfortable trade up in homes.

Good Luck to YOU!

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
Home Buying
Location:
California Sacramento County Sacramento
Groups:
The Lounge at Active Rain
Posts to Localism
Dedicated Bloggers
REALTOR LIFE
Diary of a Realtor
Tags:
sacramento real estate news
sacramento home buying
sacramento home selling

Spam prevention
Show All Comments
Rainmaker
1,218,042
Mary Yonkers
Alan Kells School of Real Estate/Howard Hanna Real Estate - Erie, PA
Erie/PA Real Estate Instructor

Myrl--well written step by step manual for life-long buyer/seller/buyer/seller cycle.

For me I plan to stay put until I need condo or assisted living.  Just kidding Hubby won't move until it's down under. 

LOL  Mary

Jan 19, 2011 12:22 PM #1
Rainmaker
2,536,283
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Mary - Thank you for your kind words.  I moved into my present house in 1983.  It was supposed to be an interim house.  But life happens while you're busy making other plans:-)  Over the years, I have grown to love this place, have fixed it to my liking. . .They will have to carry me out of here in a box:-)

Jan 19, 2011 01:08 PM #2
Ambassador
1,541,335
William Johnson
Retired - La Jolla, CA
Retired Real Estate Professional

Hi Myrl, When I found my current home, I hadn't listed the one I was living in. I did a bridge loan because I didn't want to lose it. It was so easy. Not any more. The paperowork and grief is almost not worth the effort to do one of those today.

As for carrying you out in a box, they don't that anymore either. Nope. Probably in a bag, LMAO. Just don't make it any time soon, like in the next umpteen years. Who will read my blogs and look at my photos ? No, I mean to say, who will actually read my blogs and critique and encourage my photography efforts? hehehe

Jan 19, 2011 02:12 PM #3
Rainmaker
251,098
Debi Boucher
Real Estate Showcase Photography - Woodland Park, CO
"Realtor Showcase" - Real Estate Photography/Virtual Tours

It's amazing how much has changed in a short coupla years! Well written post, Myrl :)

Jan 19, 2011 03:51 PM #4
Ambassador
1,470,825
Toni Weidman
Sailwinds Realty - Trinity, FL
20+ Years Selling Homes in New Port Richey, FL

I think the most important line, Myrl, is "get pre-approved for a loan". I still can't believe how many people want to go out looking when they don't know how much house they can afford.

Jan 19, 2011 10:44 PM #5
Rainmaker
2,536,283
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

William - Oh yes, the good ole days when bridge loans were easier. 

William you are beloved by so many within the ActiveRain community, including me.  I am certain that should I get carried out in a box, there will be the remainder of the AR flock that will continue to sing your praises, while encouraging your talents:-)

Jan 19, 2011 11:53 PM #6
Rainmaker
2,536,283
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Debi - When I consider where we were in 2005, and where we are now, it seems almost unbelievable.  I've seen all type of real estate cycles these past three decades, but this one takes the cake.

Jan 19, 2011 11:55 PM #7
Rainmaker
2,536,283
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Toni - The all important "pre-approval" letter is more vital now, than ever before. 

Jan 19, 2011 11:56 PM #8
Rainmaker
330,307
Rosalinda Morgan
Brookville, NY
"The Rose Lady"

Myrl - Well written post.  We should've listed our house in NY first before we bought our next house in SC.  But we fell in love with my next house and I don't want to lose it.  

Jan 20, 2011 04:00 PM #9
Rainmaker
309,035
John Mayer
Oikos Realty, Cape Canaveral, Cocoa Beach Florida - Cocoa Beach, FL
Your Beach Area Expert

Myrl - Great post! That pre-approval letter has to be in place before I go off on a wild goose chase. I'm happy where I am and like you, won't be moving any time soon.

Jan 21, 2011 05:39 PM #10
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
2,536,283

Myrl Jeffcoat

Greater Sacramento Real Estate Agent
Ask me a question
*
*
*
*
Spam prevention