Some of the clients I’ve been working with lately are what you call “move-up buyers.” Who are move-up buyers? What are they trying to achieve?
Move-up buyers are often living in their first home and are hitting a point where they need a little bit more space or have different family goals. Hence, they’re seeking a fresh start and a new home. When I meet with these buyers, I’ll ask them a few important questions, such as:
- Are there homes out there that excite you?
- Do you already know the home you want to purchase or do you need to get out there and see what the current inventory looks like?
- Do you need to sell to buy?
- What is your timeline?
Those questions help us put a plan together, and after that initial discussion I typically see three common scenarios. The first is putting a contingent offer on a new home, then settling on the old home and new home on the same day. The second is selling first and then buying. The third is buying first and then selling. Each option has its advantages and disadvantages.
The first option means the purchase of your next home is contingent on the sale of your current home. A couple dominos have to fall in this scenario. It represents the least amount of risk for move-up buyers, but it’s also the least attractive option to sellers—especially when we’re in a seller’s market.
The second option occurs when people want to buy in a specific area and there’s a unique type of home they’re looking for so they sell their current home and move in with friends or relocate to a short-term rental. When that home does come on the market, they can be very nimble, and they can also put a non-contingent offer on it, which makes their offer more attractive to the seller.
The last option happens more than you think. This tends to occur with families with kids or pets and there are a lot of barriers to get their home ready and approved for showings once it’s on the market. By moving into their new home, they can get their old home ready for the market. Once it’s listed, they can approve every showing because they aren’t living there anymore. The downside of this is that family may have to carry two mortgages for a month or two.
If you’re a move-up buyer (or any type of homebuyer), the best advice we can give you is this: set a big goal and make a date when you want to move into your new home. Once you establish that big goal, break it down into smaller micro-goals and collaborate with your agent to put a strategic plan into place to make sure you’re taking the right steps and maximize your potential once you hit the market.
Lastly, have trusted partners you can rely on. Whether it’s a lender, an inspector, or a staging consultant, having good people in place will help you make good decisions.
If you have any questions or are looking to make a move in our market, don’t hesitate to reach out to me. I’d be happy to help.