Home Buying and Selling at the Same Time in Sacramento
For the past 8 years, the market has been so depressed in Sacramento that it was fairly uncommon to find anyone buying and selling a home at the same time. That’s because many sellers were doing a short sale or had walked away from their homes due to the falling market, while other sellers didn’t have the equity they desired. It was actually the perfect time to sell a home and move up because the move-up price was so much lower back then but people feel uneasy during challenging times and tend to do nothing.
Now that we have a somewhat stabilized market and prices have increased over the past several years, in some areas as much as 40%, there is more movement. Much of it, surprisingly, is in downsizing. Sellers are taking their equity and moving it into a smaller home. But they still need have a plan for home buying and selling at the same time if they don’t want to move twice.
There are many ways to accomplish this task, but the most common way to buy a home contingent on selling an existing home is to use a Contingency of Purchase addendum to the purchase contract. Agents would be wise to thoroughly read and familiarize themselves with this particular document because it has changed, and I’m not kidding you, it is complicated. It is so complicated that recently Sacramento real estate agents argued over its contingency period because it appeared unclear.
The COP by default will allow the seller to keep her home on the market during the contingency period of 17 days. It gives the buyer 17 days to get her home into escrow. If during this time period of 17 days, the seller receives, say, a non-contingent offer, the seller is free to ask the existing buyer to remove the contingency to sell. If the buyer refuses, the seller can give the buyer 3 days and then cancel the buyer so the seller can accept the new offer. It’s a first right of refusal clause for a buyer.
Confused yet? It’s almost an art to engage in home buying and selling at the same time.
Of course, it’s easier for a buyer to first sell her home, put it into escrow, and then look for a home to buy, contingent on her home closing escrow. Or, a buyer can sell her home, close it and rent back for a while as she looks for a new home to buy. Or, a buyer can enter into a long escrow period, say 60 days, to give her plenty of time to buy another home.
However, with limited inventory on the market, the buyers with an existing home who will have the easiest time are those with cash in hand after closing or a loan preapproval letter and no home to sell (or a home she doesn’t need to sell to buy). Yet, it’s not impossible to project a successful outcome for home buying and selling at the same time. You just need to hire a real estate agent who knows how to do it for you. You can call Elizabeth Weintraub at 916.233.6759. I answer my phone.