How To Position Yourself To WIN No Matter What The Housing Market Does In 2022
The market is hot, houses are selling faster than ever, and buyers are bidding them up, getting sellers more money than they are asking for in their initial asking price…
However, a lot of sellers are scared to sell right now because they don’t know what the market is going to do or where they are going to buy their next home in this insane market.
But what if it didn’t matter whether the market went up or down?
What if you positioned yourself to come out on top of the market, regardless of whether housing prices go up or down.
I’d like to share an idea with you to give you a leg up. A strategy of sorts that you can use to come out on top no matter which way the housing market decides to go.
Are you intrigued yet?
But before we jump into “how to” so you can position yourself to take advantage of this crazy, current market, let’s talk about the two big myths…
Myth #1: You have to move out of your house the day you sell it
Lately, I’ve been closing on many homes where the sellers are negotiating the option to continue living in their home 30, 45, or even up to 60 days after the sale of their property.
They have a Leaseback Option written right into their contract and closing documents.
I did one closing here in St. Pete last month where the buyers gave the seller two months rent-free as part of their offer.
The seller was super-happy to not have to move out immediately. So happy, that they even gave the buyers a really nice piece of furniture that the buyers commented on at the closing table.
The buyers said that it wasn’t necessary, but the seller insisted.
“It’s the least we can do since you’re giving us two months before having to move out,” the seller replied.
Myth #2: You have to buy a new home as soon as you sell your previous house
Something else I’ve been seeing sellers do recently is not taking the profits from the sale and immediately purchasing a new home.
At another closing, one couple told me that they were going to be renting for the next year until the market slowed down. Then they planned on purchasing a new home when things cooled off.
Obviously, there is always the potential that the market may keep going up for another year.
But even if it does, don’t worry…
Because what I’m about to share with you is a simple strategy you can use to position yourself to come out ahead no matter whether the prices of houses go up or down.
We’ll get to that in just a minute, but before we do, let’s talk about the benefits of waiting to buy a new home by leasing back your own home (which is great because you only have to move once) or rent another house (which gives you even more time to hunt for your dream home).
HERE ARE 7 BENEFITS TO SELLING NOW BUT WAITING TO BUY YOUR NEW DREAM HOME USING THIS SIMPLE STRATEGY
1) IMMEDIATE CASH RESERVES
You have a large chunk of cash that you can use to make a sizable down payment on a new home. You can put down a larger earnest deposit than other buyers who are bidding against you.
2) LEG UP ON THE COMPETITION FROM OTHER BUYERS
One less contingency to trip up your negotiation. It’s fairly common for buyers to write a contingency for the sale of their home before they can purchase a new one. That way, if they can’t sell their home, they can walk away from the deal…which of course makes sellers nervous. But if you’ve already sold your home, that’s one less contingency you have to deal with. Sellers know that you have cash and are able to close on the deal immediately.
3) LIQUIDITY TO GET APPROVED FOR A HIGHER LOAN
You have lots of cash and plenty of liquidity which can help you to get approved for a larger loan. Getting more money from the bank means that you can buy a bigger house. Applying that together with the strategy of waiting for buy in a slower market means you can get a heck of a lot more house for your money.
4) NOT RUSHED TO SELL OR BUY
You have time to look for a new home without having to make a rushed decision. Since you don’t have to rush to sell your home, you can wait a little longer for the best offer. And when you purchase your home, you’ll have time to look at everything on the market and see what else pops up. You won’t be under the usual pressure sellers and buyers are under in these types of situations
5) EXTEND A LEASEBACK TO YOUR SELLER FOR NEGOTIATING POWER AND BETTER PRICE
As a buyer, you can extend a leaseback to your buyer – extra bonus points or even a lesser price. When you buy your new home, you can offer to extend the extra time for them to find their own place. That will give you extra negotiation power against other bidders who are in a rush to move. And you can be savvy and negotiate a nice fee for the leaseback which you can use to pay for the home which could be a couple of extra thousand dollars off on the actual price you pay that you end up getting back.
6) YOU ONLY HAVE TO MOVE ONCE (WITH A LEASEBACK OF YOUR OWN PROPERTY)
Since you don’t have to move out and unpack everything, you can focus your time searching for a new home. If you do end up renting, you aren’t worried about trying to move from one location right away. So, either way, you not just shuffling things around from one spot to another.
7) NO LONG TERM COMMITMENT (IF YOU RENT)
You don’t have to commit to anything long-term until you are sure it’s exactly what you want. If you do end up renting, you can wait to see what the market is going to do, and then make a wise and informed decision.
Which actually brings us to our strategy for buying your new dream home.
Since there is lots of uncertainty in the market right now, you want to make sure you hedge your bets and no matter what the housing market ends up doing in the long term.
You want to position yourself to come out on top whether the price of homes on the market goes up or whether they go down…
How can you do that?
By selling your house and PURCHASING ANOTHER HOME WITH A LEASE OPTION…
That means that you can move into a new home and give it a trial run to see if you like it with no long-term commitment…
It’s just like renting, but you have the option to buy it in two to five years depending on how you negotiate your deal and structure your terms.
Let’s see what happens in each scenario…
- MARKET CONTINUES TO RISE…
So, what happens if the housing market goes up and prices increase?
You still get to purchase the home at the current rate. Even if the price of other properties goes up by a crazy percentage, you can still exercise your option to purchase at today’s prices.
- MARKET COOLS OFF AND GOES BACK DOWN…
And what happens if the housing market crashes and prices drop?
You can choose to walk away from that lease option. Just make sure to structure the deal so that you are free to leave at any time. Then you can look around in the current market and buy something even better for much cheaper than it is today.
And here is another crazy idea for you.
Look for sellers who are willing to finance the deal for you over 30 years (sometimes without interest). If you know where to look to find them and you know how to negotiate them, you can get yourself one crazy deal. But shhh…don’t tell anyone else.
GETTING THE SELLER TO FINANCE ONLY SWEETENS THE DEAL
Either way, you win…no matter what the housing market ends up doing. If prices go up, you get your option at today’s lower prices. And if prices go down, you can use your cash to buy something else in the reduced market.
If you’ve been thinking about selling your home but were afraid of what the market is going to do, I hope these ideas were clear and gave you a fresh perspective for looking at things.
If you have more questions about any of these ideas, feel free to send me a message. I’ll be happy to chat with you about your specific situation.
- Questions about how to get your home ready to sell
- Questions about purchasing a new how even if you haven’t sold your current home yet
- Or even how to structure a lease option to prepare yourself for whatever the housing market decides to do
If you want help negotiating your deals and positioning yourself to win no matter what happens to the housing market in the near future, I would be happy to help you set that up.
I am a real estate agent with Coldwell Banker, which means I have an amazing broker with tons of experience and an entire team behind me to help you get your house ready for sale, come up with a tailored marketing plan to get you the most exposure and highest offer available, and also help you locate the home of your dreams to move into as soon as you’re ready.
You can message me directly at (727) 249-4022. Feel free to call if you prefer to talk. Or you can also email at contact@davebailey.me