Deciding Whether to Buy or Sell First in New York: A Homeowner’s Guide

In the whirlwind that is the New York real estate market, making the leap from one home to another brings up the age-old question: should you buy your next place before selling your current property, or should you do it the other way around? Both strategies have their merits and drawbacks, influenced largely by our unique market dynamics. Let's break down these options to help you plot the smoothest course through your real estate journey.

Buying First: Pros and Cons

Found a gem on the Upper East Side or a charming brownstone in Brooklyn that’s calling your name? Jumping on it before selling your current home is tempting. Here's what to consider:

Pros:

• You’re Set from the Get-Go: By buying first, you dodge the bullet of needing temporary digs. This saves you from the double headache of storage fees and the dread of crashing on a friend’s couch.
• Moving at Your Own Pace: Having the keys to your new place allows you to move gradually, reducing the chaos commonly associated with tight moving schedules.

Cons:

• The Financial Squeeze: Carrying two mortgages or a mortgage and a bridge loan simultaneously can lead to financial gymnastics, potentially straining your budget.
• Hurry Up and Sell: With ongoing expenses for two properties, you might feel pushed to sell your old home pronto, potentially at a less desirable price.

Selling First: Pros and Cons

Opting to sell before buying provides financial clarity but has its own set of challenges:

Pros:

• One Mortgage At A Time: You’ll breathe easier knowing you only have one mortgage to worry about, making it simpler to manage your finances.
• Better Buying Position: With cash in hand from your sale, you’re a more attractive buyer, enabling you to make stronger offers in New York’s competitive marketplace.

Cons:

• Where To Live In The Meantime: Selling first means you may need to find temporary housing if your next purchase doesn’t line up perfectly, adding an extra layer of complexity.
• Pressure to Pick a Place: Having to find your next home swiftly to avoid long-term temporary housing could lead you to compromise on your wish list.

So, What’s the Best Move?

There’s no cut-and-dry answer, but your decision should factor in these key elements:

1. Current Market Conditions: In New York’s often seller-friendly market, your current home might sell faster than you anticipate, tilting the scale towards selling first. However, pockets of the market can be slower, making buying first more feasible without the stress of a quick sale.

2. Your Financial Situation: Do you have the means to juggle two sets of housing expenses, or would the financial predictability of selling first better suit your budget? Your financial cushion (or lack thereof) will significantly impact your strategy.

3. Risk Tolerance: If the thought of monthly double-mortgage payments sends shivers down your spine, selling first may ease those fears. Conversely, if you’re okay with a little financial overlap for the perfect place, buying first might be your path.

Bridge Loans and Contingency Offers

If you find yourself torn, there’s a middle ground to explore:

• Bridge Loans: These short-term loans can ease the transition by financing your new home purchase ahead of your current home’s sale. Handy, but they’re not for the faint of heart or light of wallet.
• Contingency Offers: Making your offer on a new home dependent on the sale of your current one can provide peace of mind but be aware that in New York’s hot spots, sellers may not always bite.

Deciding to buy or sell first in New York hinges on personal circumstances and the pulse of the local real estate market. By weighing these pros and cons against your situation, you can choose a route that aligns with your needs, ensuring a smoother transition to your next chapter in the bustling New York real estate scene.