Expert: Jessica Bryan - 4/3/2007

Question
Hi -  My wife and I are living in our first home, a place we had built in 1994.  We are considering trading up to a little nicer home next summer and would like to ask for advice regarding putting our house on the market.  I expect we will probably have $100K to $125K equity after closing on the sale of our house, which we would plan to apply to the down payment on our new home, which we would have built by a national home builder.  What is the best way to coordinate timing a sale, closing on our old and new homes and what are the options when trading up so that we don't own two homes and we don't own zero homes!  Thanks!

Answer
Dear Joel;
When considering a move into a new home you should always plan for the possibility that you won't be able to have them both close at the same time.  Talk to a few REALTORS and get an idea of how long it might take to sell your home.  This will give you an estimate of when to put it on the market.  You should always allow for about 45 days from the time of entering a contract to closing.  If you get an estimate of completion date from the builder you can then figure 45 days back from that and additional time on the market before the offer comes in.  so, for example, if homes like yours are taking three months to sell, you should allow 4 1/2 months total from the time the builder says your home will be complete.  You can also arrange for a rent back time on your existing home so if your new home isn't ready you can stay in your existing home a little longer paying the new owners rent until you can move.  Letting everyone know the dates that you want to close and making sure that everyone is aware that you would like to close on both on the same day will give you a target.  However, plan for the best or the worst scenarios.

Good luck and best wishes.

Jessica Bryan