Buying and selling houses can be tricky, particularly if you are selling and buying a home at the same time. Should you buy a new property first, or sell your current home before purchasing a new one? It's an age-old conundrum.
We take a look at the pros and cons in the light of the current housing market, to help you make the right decision.
How to buy a new house in the current housing market
Talk to your agent to find out whether you are facing a buyers or seller’s market. In most property markets, selling your property before buying your next is most sensible.
Once you have released the equity from your current property, you can keep your eye out for a property you love and negotiate knowing how much money you have to spend.
However, putting the above aside, the process you choose will depend entirely on your circumstances.
Can I buy another house before I sell mine?
Technically, there’s absolutely nothing to stop you buying your next property first if you can afford it. Buying a new home before selling your current one does have a couple of advantages:
● It means you don’t miss out if you fall in love with a particular property before you have sold your own.
● It gives you more time to complete the move – you can take your time moving all your possessions, as there is nobody else waiting to move into your current home.
However, these elements tend to be outweighed by the advantages of selling your current home before you buy a new one:
1. You are more likely to achieve the best possible sale price
If you sell your current property first, you have time to make it look as attractive as possible so it will gain a higher sale price. You can also take time to consider offers and negotiate with buyers until you get the results you want.
If you have already bought a new property, you might feel time-pressured, as you could be paying two mortgages at once, or have a bridging loan. This could tempt you to sell your current property for less than it is worth for a quick sale.
2. You know exactly how much money you have to spend
Selling your current property first lets you know exactly what you can afford when it comes to purchasing a new property. It prevents you from getting into financial difficulties through overestimating the value of your current property, then not achieving the sale price you wanted.
3. It can save you time as well as money
If you buy a new property before you sell yours, you will not only have to pay two mortgages and two sets of bills, you will also be responsible for the upkeep and maintenance of two properties. This can take up a considerable amount of your time when you should be settling into your new home.
4. Remember, you don't have to rush your move
Ideally, you need to find a new home as quickly as possible after selling your current one. However, it doesn’t mean you need to end up staying with relatives! You can always seek to extend the settlement period on your current property to give you more time to find a new property you love.
One of the most important things to do when buying or selling a house is to find an experienced and reputable real estate agent who will be able to make the process as smooth as possible for you.
I understand that buying and selling a property can be a tricky process, particularly when you are selling and buying a home at the same time.
If you would like more information about buying and selling houses, or want to know how to buy a house before selling yours, please contact me, and I'll be happy to help.
The real estate market is expected to continue growing in 2021, and it’s largely driven by the lasting impact the pandemic is having on our lifestyles. As many of us spend extra time at home, we’re re-evaluating what “home” means and what we may need in one going forward.
Here are 4 reasons people are reconsidering where they live and why they’re expecting to buy a home this year.
1. Record-Low Mortgage Interest Rates
In 2020, the average interest rate for a 30-year fixed mortgage hit a record low multiple times, continuing to fall further below 3%. At most major banks, the average interest rate today is 2.70% or slightly lower.
Many wonder how low these rates will go and how long they’ll last.
This sense of urgency is driving many to buy this year.
2. Working from Home
Remote work is a new normal for many businesses, and it’s lasting longer than most expected. Many in the workforce today are discovering they don’t need to live close to the office anymore and they can get more for their money by moving a little further outside of the city limits. The reality is, for some people, working remotely in their current home is challenging, especially when there may be other options available. We are getting an increase in calls from not only Auckland, but also our other biggest cities Wellington and Christchurch about making the move up north.
3. More Outdoor Space
Another new priority for homeowners is having more usable outdoor space. Being at home is driving those in some areas to seek less densely populated neighbourhoods so they have more room to stretch their legs. In addition, those living in units and townhouses are often looking for extra square meters, both inside and out.
4. Avoiding Renovations
It’s recently come to light that many homeowners would also rather buy a new home than go through the process of fixing up the one they have. Depending on what needs to be addressed, today’s high buyer demand may make it possible to skip some renovations before selling. Many of these homeowners have prioritized buying over renovating for convenience and potential cost savings.
It’s clear that homeownership needs are changing. As a result, more Kiwis are expected to move this year than last year.
If you’re trying to decide if now is the right time to sell your home to take advantage of these reasons, then contact me today to discuss your options.
It is easy to become overwhelmed when you enter the home buying market. Friends, family, colleagues, and even acquaintances will give you their opinions if you are a first time home buyer. While most of them are looking out for your best interest, they are not fully aware of what is happening in the housing market.
It is important for you to be prepared and have your own questions ready. No matter what other opinions you are getting, you are the one buying the home and your comfort level will help make your final decision. Here are three important questions to ask before you purchase a home.
1. Why am I Buying a Home?
Regardless of the finances, it is important to think about what made you want to buy a home in the first place. Usually the reasons don’t have to do with money. Instead, home buyers are focused on how the house will impact their family in the future. A study done by the Joint Center for House Studies at Harvard found there are four reasons people buy a home. Those reasons include schools for your children, a safe environment, more room for your family to grow, and control of your own space.
These factors are the most common reasons people look to buy a new home. When you ask yourself why you are looking to purchase a home, do any of those factors come up? Spend time with your spouse or family members who are involved in this decision and determine why you want a home in the first place. Creating this list will help when searching for a home and can help your real estate agent find the best home for your needs.
2. What is the Trend with Home Values?
Our current economy and housing market is strong. That means home values are increasing.
If you are looking to purchase a home but want to stay within a budget, it may be in your best interest to move quickly. It is forecasted for these trends to continue in an upward motion, causing home values to continue to increase over the next 12 to 18 months.
3. What About Current Mortgage Rates?
The ticket price is not the only thing you should be concerned with when purchasing a home. Mortgage rates are always changing and can have a huge impact on your monthly payments. Current trends show mortgage rates are at an historically low level. But, what happens in a year or two from now if they rise? This is something to consider if you are debating the right time to purchase a home, since the rates may be higher down the road.
You and your family are the only ones who can determine the right time to purchase your home. It is important to decide exactly why you want a new home for your family and decide on a budget that will be comfortable moving forward. This budget may affect the amount of time you have to search for a home, since home prices in Whangarei are still increasing.
Even in today’s sellers’ market, setting the right price for your house is one of the most valuable things you can do. Existing home prices nationwide are forecasted to increase by a further 9 - 12% in 2021. This means experts anticipate home values will continue climbing this next year.
How to Price Your House
When it comes to setting the right price for your house, the goal is to increase visibility and drive more buyers your way. Instead of trying to win the negotiation with one buyer, you should price your house so that demand is maximized, and more buyers want to take a look. A fantastic method to achieve this is by running an Auction campaign for your house sale.
As a seller in today’s market, you might be thinking about pricing your house on the high end - while so many of today’s buyers are searching harder than ever just to find a home to purchase. But here’s the thing – a high price tag does not mean you’re going to cash in big on the sale. It’s actually more likely to deter buyers. This is due in large part to the price filtering settings on all of the online property sites. If you price your home outside where buyers are looking, then a significantly lower amount of them will initially see your house for sale, and even less will come to physically inspect it.
Right now, even when there are so few houses for sale, your house is more likely to sit on the market longer or require a price drop that can send buyers running if it isn’t priced in the right range from the very beginning.
When you price it competitively from the start, you won’t be negotiating with one buyer. Instead, you’ll likely have multiple buyers competing for the house, potentially increasing the final sale price. Or, even better, several bidders turning up to bid on Auction day.
The key is to make sure your house is priced to sell immediately. This way, it will be seen by the greatest number of buyers. More than one of them may be interested, and it will be more likely to sell at a competitive price.
Thinking about selling? Reach out to me to talk about your correct price point for your home, get a great marketing plan for your property, and have some fun doing it!
My mission is to help you maximize your exposure and achieve the very best sale price in the current marketplace.
The real estate market is expected to do very well in 2021, with mortgage rates that are hovering at historic lows and forecasted by experts to remain favorable throughout the year. One challenge to the housing industry, however, is the lack of homes available for sale today. Whangarei, like the rest of New Zealand, has an inventory of homes for sale currently at an all-time low - about half of what we’d normally see. That is continuing to put pressure on the market.
What Does This Mean for You?
If You’re a Seller:
Realize that, in some ways, you’re in the driver’s seat. When there’s a shortage of an item at the same time there’s a strong demand for it, the seller is in a good position to negotiate the best possible terms. Whether it’s the price, moving date, possible repairs, or anything else, you’ll be able to request more from a potential purchaser at a time like this – especially if you have multiple interested buyers. Don’t be unreasonable, but understand you probably have the upper hand.
We are seeing fantastic results at our Auctions, because the demand from buyers combined with my great marketing plan for homes is setting them apart from the limited amount of other properties for sale at the same time.
If You’re a Buyer:
Be patient during your home search. It may take time to find a home you love. Once you do, however, be ready to move forward quickly. Get pre-approved for a mortgage, be prepared to make a competitive offer from the start, and know that a shortage in inventory could mean you’ll enter a bidding war. Calculate just how far you’re willing to go to secure a home and lean on us as your expert guides along the way.
The housing market will remain strong throughout 2021. Know what that means for you, whether you’re buying, selling, or doing both. If you are thinking of selling or buying, contact me today!
It’s exciting to put a house on the market and to think about making new memories in new spaces. However, despite the anticipation of what’s to come, we can still have deep sentimental attachments to the home we’re leaving behind. Growing emotions can help or hinder a sale depending on how we manage them.
When it comes to the bottom line, homeowners need to know what it takes to avoid costly mistakes when it’s time to move. Being mindful and prepared for the process can help you stay on the right track when selling your house this year.
1. Price Your Home Right
When inventory is low, like it is in the current market, it’s common to think buyers will pay whatever we ask when setting a listing price. Believe it or not, that’s not always true. Don’t forget that if buyer’s are financing their borrowing, then the banks will look to determine the fair value for your house. The bank will not lend more than what they deem the house is worth.
We will help you set the true value of your home.
2. Keep Your Emotions in Check
Today, homeowners are living in their houses for a longer period of time. Since 1985, the average tenure, or the time a homeowner has owned their home, has increased from 5 to 10 years.
This is several years longer than what used to be the historical norm. The side effect, however, is when you stay in one place for so long, you may get even more emotionally attached to your space. If it’s the first home you bought or the house where your children grew up, it very likely means something extra special to you. Every room has memories, and it’s hard to detach from the sentimental value.
For some homeowners, that makes it even harder to negotiate and separate the emotional value of the house from the fair market price. That’s why you need us to help you with the negotiations along the way.
3. Stage Your Home Properly
We’re generally quite proud of our décor and how we’ve customised our houses to make them our own unique homes, but not all buyers will feel the same way about your design.
That’s why it’s so important to make sure you stage your house with the buyer in mind.
Buyers want to envision themselves in the space so it truly feels like it could be their own. They need to see themselves inside with their furniture and keepsakes – not your pictures and decorations. Stage and declutter so they can visualize their own dreams as they walk around. We can help you with tips to get your home ready to stage and sell.
Today’s sellers’ market might be your best chance to make a move.
If you’re considering selling your house, I’m available to start talking through a plan with you. Let's talk.
It may seem hard to imagine that the home you’re in today – whether it’s your starter home or just one you’ve fallen in love with along the way – might not be your forever home.
Many needs have changed in 2020, and it’s okay to admit if your house no longer fits your lifestyle.
If you’re now working remotely, trying to exercise at home, or simply just spending more time in your own four walls, you may be bursting at the seams in your current house.
Prices have appreciated 13% year-over-year in the Whangarei region.
At the same time, our overall inventory (houses for sale) has dropped from one year ago.
These two statistics are directly related to one another. As inventory has decreased and demand has increased, prices have been driven up.
This is great news if you own a home and you’re thinking about selling. The equity in your house has likely risen as prices have increased. Even better is the fact that there’s a large pool of buyers out there searching for their next property, and your home may be high on their wish list.
If you think you’ve outgrown your current home, reach out to me to discuss local market conditions and determine if now is the best time for you to sell.
Experts say national house prices could rise by as much as 13 to 16 per cent in the next few months.
That number seems crazy, but in the past 12 months the Whangarei area median house price grew by 13% year-on-year.
Will we see the same again this year? It’s a great time to sell then, but what about to buy?
Read on for my take on it...
Economists at Westpac, ASB, BNZ and Kiwibank say low interest rates and high demand will continue to have an impact in the new year.
The economists' predictions vary, but they agree that 2021's housing market will build on records set last year.
These predictions come despite the Reserve Bank's scheduled introduction of tougher lending rules for investors in March.
Westpac chief economist Dominick Stephens said house price inflation had a way to run yet and he's picking big growth this year.
"We are forecasting a peak of 16 per cent annual house price inflation in June 2021, and a full-year increase over 2021 of 12.2 per cent," he said.
"House prices are being driven higher by low interest rates, and interest rates are set to stay low or fall further over the coming year. Meanwhile, other factors such as net migration and the economy are going to improve. So our models point to ongoing rapid house price increases."
This prediction is on par with ASB senior economist Mike Jones and BNZ's Stephen Toplis, who forecast double-digit growth by the end of the year.
Kiwibank's chief economist Jarod Kerr was the most conservative among the major banks, tipping more modest 5 to 6 per cent growth later next year when lending restrictions bite.
While all of that is based on solid data, it is just speculation, here is what we do know…
Housing is based on the simple formula of supply and demand. So for now, and continuing on from the last few months especially - there is far greater demand for houses than what is available, and that is pushing the prices up.
If everybody had a house they wanted to live in, and a couple of investment properties, then the demand would be far less, resulting in lower or at least stable house prices.
The big issue after our COVID restrictions appears to be the number of Kiwis wanting to return home, along with people looking to move out of the larger cities - Auckland in particular, and move to the smaller towns and provinces. Whangarei is high on buyers list as we are located only 2 hours from Auckland, the climate is good, and the beaches and outdoor activities are truly world class - all of it not being too crowded, for now...
On all of the properties that I sold in the past 6 months, I had calls with people from Auckland that were firming up their future plans. A lot of them are now retiring 5-10 years early, cashing up and looking to make a permanent move to places where they have enjoyed holidaying or have family already living.
The other big issue that I talk to a lot of people is - “we know that we will get a great price if we sell, but then we are buying in the same hot market, why would we do that?”
While this is totally correct, the thing to look at is the historically low interest rates.
So, it is actually a very good time to sell your current house, and upgrade to a home that better suits your needs. The overall ‘cost’ of borrowing money has never been cheaper.
It may be that you now need a dedicated home office, bigger garage for cars along with a home gym setup, or, just more space for the family to be a family if we have any more restrictions around movement in our future.
I had friends in Auckland that had to endure Level 4 lockdown in a small central city apartment, while we were able to do it in a house big enough for all of us to have our own space, as well as room for the kids to jump on the trampoline, and ride their bikes up and down the driveway.
To put it out there, I agree with the ‘experts’ that we will see house prices continue to rise for the first part of this year. To grow another 13 - 16% after we’ve just had a year of 13% growth seems a bit much, but the thing is, none of us know how much demand buyers that want to secure properties will put on the market.
I’m here to talk more around your property selling plans, and help you take advantage of the current situation anytime you’d like to. Get in touch here, or just call me on 021 606460.
If you’re one of the many homeowners thinking about taking your house off the market for the summer holidays, hang on.
You definitely don’t want to miss the great selling opportunity you have right now.
Here’s why this is the optimal time to make sure your house is available for holiday buyers.
The inventory of houses for sale has dropped to an astonishing all-time low. It now sits at a 2.5-month supply at the current sales pace. Historically, a 6-month supply is necessary for a ‘normal’ or ‘neutral’ market, in which there are enough homes available for active buyers.
When the supply of houses for sale is as low as it is today, it’s much harder for buyers to find homes to purchase. This means competition among purchasers rises, and, more bidding wars take place - if your property is going to Auction - , making it essential for buyers to submit very attractive offers no matter which method of sale you decide on.
As this happens, prices rise, and sellers are in the best position to negotiate deals that meet their ideal terms. So, if your neighbours decide to remove their listings this summer season, your house may quickly rise to the top of a buyer’s wish list if you stay on or launch to the market now.
Today, there are many buyers who are ready, willing, and able to purchase. Record-low mortgage rates and a year filled with unique changes have prompted buyers to think differently about where they live and to take action. The supply of homes for sale is not keeping up with this high demand, making now the optimal time to sell your house.
Home prices are appreciating in today’s sellers’ market. Making your home available over the next few weeks will give you the most exposure to buyers who will be actively competing against each other to purchase it.
Thinking about selling this summer holiday season? Reach out to me today for a free consultation.
Housing is thriving! As the economy recovers from this year’s health crisis, the housing market is playing a leading role in the turnaround. It’s safe to say that what we call “home” is taking on a new meaning, causing many of us to consider buying or selling sooner rather than later.
Today’s high buyer demand combined with low housing inventory means we’re seeing home prices continue to rise at an above-average pace. This demand is being driven by those who want to take advantage of historically low mortgage rates.
These factors are driving a positive impact on the economy as a whole.
As new home builds continue at a fast pace, the construction sector is continuing to look strong for the next 12 plus months.
There’s no doubt the growing economy is being fueled in part by the soaring housing market. Experts forecast this housing growth to carry into 2021, continuing to make a big impact on the economy next year as well.
The Kiwi dream of homeownership has continued to thrive in the midst of this year’s economic downturn, and “home” has taken on a new meaning for many of us during this time.
Best of all, the housing market is making a significant impact as the economy recovers.
Thinking of buying or selling? Contact me today!
Helpful and interesting info from Paul, and Harcourts to help you with your property journey.