As a trusted FSJ realtor, one of the most common questions I receive from clients is whether they should buy or sell first. It is a decision that can have a significant impact on their finances and overall real estate experience.
Buy Or Sell First? Market Conditions
Market conditions in the Peace Region play a crucial role in determining whether it is best to buy or sell first. In a buyer’s market, where there are more homes for sale than buyers looking to purchase, buyers have more negotiation power and may be able to take advantage of lower home prices. In contrast, in a seller’s market, where there are more buyers than homes for sale, prices may be higher, and buyers may find it more difficult to find a home they love and can afford. In a balanced market, where the number of buyers and sellers is roughly equal, buyers may have more options to choose from, and sellers must be competitive with their pricing and marketing strategies to attract interest.
How do we determine market conditions?
So how do we determine the current state of the market? The BC Real Estate Board uses a formula where the number of sales is divided by the number of active listings. If the number falls between 15 and 25%, the market is considered balanced. Below 15% is a buyer’s market, and above 25% is a seller’s market. In March of 2021, the Fort St. John region of British Columbia came in at 20% and held steady through April, right smack in a balanced market. The interest rate increase of late 2021 slowed both buyers and sellers, maintaining a balanced market throughout the Peace Region.
How current market conditions play a role
A buyer’s market may mean buyers should buy first to take advantage of lower prices and favourable negotiation conditions. On the other hand, in a seller’s market, sellers may want to sell first before buying to solidify their financial position to purchase a new home. In a balanced market, the decision may depend on personal preference and financial situation. Some buyers may prefer to buy first to ensure they can find a home that meets their needs, while others may prefer to sell first to avoid the financial risks of owning two homes at once.
Financial Impact
It’s crucial to consider the financial impact of buying before selling, including factors such as down payments, closing costs, and the potential profit or loss from a sale. When buying a new home, consider how much you can afford to spend on a down payment, ongoing mortgage payments, property taxes, and other expenses. If you choose to buy before selling, can you handle the expenses of both properties if your old home doesn’t sell for what you anticipated?
When selling your existing home, factor in the potential profit or loss from the sale, which depends on the current state of the market, the condition and location of your home, and the price you paid for it. Also, factor in any costs associated with selling a home, such as real estate commissions, staging costs, and other expenses.
I am here to help you!
As a realtor, it is my job to evaluate your financial situation and provide guidance on the best course of action for your unique circumstances. I can assist with timing both buying and selling a home, including helping determine the best time to list your home for sale based on the current state of the real estate market and seasonal fluctuations in demand.
Contact me today if you are ready to chat and make a change into a new home here in Fort St. John!