Should You Sell First or Buy First? A Guide for Homeowners
If you’re planning to make a move—whether upsizing, downsizing, or relocating—the question always comes up:
Should you sell your current home first or buy your next home first?
The answer depends on your personal situation, market conditions, and your comfort level with financial risk.
Let’s walk through the advantages and disadvantages of each option, and take a closer look at how the “sale of buyer’s home” condition works in Alberta real estate contracts.
Option 1: Selling First
✅ Advantages:
- You Know Your Budget: Once your current home is sold (or conditionally sold), you’ll have a clear idea of your proceeds and how much you can spend on your next purchase.
- Reduced Financial Risk: You won’t carry two mortgages, which means less financial stress and no overlap in ownership costs.
- Better Position When Buying: You may have stronger negotiating power as a buyer with a firm sale in place—especially in a faster or balanced market.
❌ Disadvantages:
- Tight Timeline to Buy: You may feel pressure to find a new home quickly before your possession date. That can lead to compromises.
- Temporary Living Arrangements: If you can’t find the right home in time, you might need to rent or move in with family while you search.
Option 2: Buying First
✅ Advantages:
- You Find the Right Home First: You can take your time, get the home you really want, and move directly from one property to the next.
- No Need for Temporary Housing: Your move can be seamless if the timing lines up.
- Lock in a Purchase Before Prices Rise: In an appreciating market, buying first may help you secure a home before prices increase.
❌ Disadvantages:
- More Financial Risk: You may end up carrying two properties for a period of time—especially if your home doesn’t sell quickly.
- Need for Bridge Financing or Strong Equity: You may need access to funds or financing to cover your down payment before your current home sells.
What Is the “Sale of Buyer’s Home” Condition?
In Alberta, if you choose to buy first, you can often protect yourself by writing a “Sale of Buyer’s Home” condition into your offer. This condition allows you to secure a purchase while giving you time to sell your existing home.
🔍 How It Works:
- You submit an offer subject to selling your current home by a certain date.
- If accepted, the seller continues marketing their property.
- If another offer comes in, the “time clause” is triggered—typically 24 to 72 hours. You then have that window to either:
- Remove your condition and proceed (which usually requires a firm sale or bridge financing), or
- Walk away with your deposit returned.
⚠️ Important Notes for Alberta Sellers:
- Accepting an offer with this condition means your home is conditionally sold, but it’s not guaranteed to close unless the buyer sells their home.
- It limits your flexibility, so these offers are generally less attractive unless market conditions are slow.
Final Thoughts: Which Should You Choose?
There’s no one-size-fits-all answer, but here’s a quick guideline:
- In a strong seller’s market where homes are selling quickly, it may be safer to buy first, knowing your current home is likely to sell fast.
- In a balanced or buyer’s market, it may be wiser to sell first to avoid carrying two properties and risking unsold inventory.
Need Help Navigating the Timing?
Whether you’re leaning toward buying or selling first, I can help you explore your options, understand current market conditions, and protect your interests every step of the way.
📞 Reach out for a no-pressure strategy session tailored to your goals.
