Home sellers are often confronted by an uncomfortable question. What if they sell quickly and have nowhere to live?
The traditional solution goes like this. Find another home you love. Buy it, subject to sale of your existing property or by using bridging finance, and then sell the current property.
This common ‘solution’ presents a danger that more than any other leads home sellers to financial loss.
Agents love it; they obtain a truly motivated seller. Banks love it; they gain or keep a client and get double the interest until the property sells.
However, properties don’t always sell quickly, or at the expected market price. Financial loss when selling can be hard and fast, or so subtle that the seller doesn’t even realise its happened.
The most common scenario ends up looking like this: Concerned about being homeless, people begin searching for properties to buy, often finding the perfect home. The dream of the new home plus a fear of missing out prompts them to pay a premium when purchasing. They then ask the purchasing agent to price their existing home. The improbable lie rolls out and the sellers do their figures and decide it’s a perfectly affordable move. They may even finance it immediately, using bridging finance.
Their property is listed at an inflated price but doesn’t sell. As the clocks tick by, financial and emotional pressure on the seller increases. This helps the agent ‘educate’ the seller down from the improbable lie to a selling price far below the original estimate. The homeowner ends up selling their original home for less than expected and paying too much for their new home, losing on both sides of the transaction.
Following four simple steps can easily avoid this financial danger.
Don’t risk your financial security. This will only benefit others. Use a safe and proven strategy when selling.
For a free copy of “Real Estate’s Greatest Dangers” please contact our office.