Sometimes, a super quick sale isn’t what you want.
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During our first few years of marriage, my husband and I lived in what we called our starter home. In reality, it was his home that he’d purchased solo and then welcomed me into. But we knew early on that we probably wouldn’t stay in that home for too long. It was on the smaller side and didn’t have a lot of room for storage. And since we were planning to have children, we knew we wanted more space.
Our initial goal was to list our home after having found a new one. But then the 2008 housing market crash happened, and we got spooked.
We decided to list our home in early 2009, before housing prices really started to plummet. Since buyer demand wasn’t so high at the time, we figured we’d get the ball rolling with a listing and start looking for a replacement home at the same time.
Surprisingly, though, we got a nice offer on our home the day it hit the market. And while that was a good thing in theory, it wound up being a problem.
When you’ve sold your home and have nowhere to go
The offer we got on our starter home was a good one given the state of the market. And we stood to make a nice profit on that house. So we accepted that offer knowing we’d only have a few months to find somewhere else to live.
From that point on, we dove into our search, only to find that it wasn’t getting us anywhere. But then, we stumbled upon an opportunity to purchase new construction in the same neighborhood.
We jumped on that chance, especially since the builder had recently lowered his price due to the state of the housing market and the fact that he was struggling to find a buyer. And while we knew that a new construction home would leave us with a higher mortgage loan, we also figured it was worth paying more each month to get a pristine home we could design ourselves.
Meanwhile, our buyers were extremely gracious and agreed to push off our closing date by a couple of months to allow for more time for our new home to be completed. Only our builder’s estimates were way off.
Instead of our home being ready for occupancy by June of 2009, it took our builder almost six months longer than anticipated to finish the job. Since we had to leave our starter home by June, we were forced to secure temporary housing through the fall — not an easy thing to do when you have no idea how many months of housing you need and you also have a dog.
But the bigger issue, frankly, was that even though we were excited to buy new construction, we basically felt forced into it because we had a buyer for our starter home and needed to purchase a new home. Had we not been so pressured, we probably would’ve done a better job vetting our builder (who turned out to be very unprofessional and shady in many regards). Or, we would’ve maybe pursued a different home altogether.
Lesson learned
My husband and I clearly had our reasons for listing our home when we did. And while we thought it would take months to sell, it only took hours. But what we should’ve done was wait until we had a replacement home in mind before putting that listing up.
In a down market, which is what we were buying in, it’s often possible to make an offer to buy a home that’s contingent on your current home selling. That would’ve been a much better path for us.
Granted, you can’t always get away with doing that in the context of new construction. But it’s not like we had our hearts set on a newly built home. Rather, that was simply the first buying opportunity that came up.
Of course, in a seller’s market, it’s harder to get an offer on a home accepted with a home sale contingency attached to it. So that tactic may not work as well today. But it’s one that we should’ve used back then to spare ourselves all the hassle.
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