Should I buy before I sell or sell before I buy?

Do you really know what your home is worth?  Are you relying on its likely sale price to fund the purchase of your next home?  It turns out even the biggest stars’ gambles don’t always pay off.  As shown in this ABC article a case in point is the recent successful suing of actress Toni Collette and her husband who pulled out of the purchase of a $6.35m Sydney property stating they didn’t have the money when their current home didn’t achieve the dollar figure she and her husband thought it would.

In reading the various media commentary as well as statements made by Toni Collette it appears the reason they came to believe their home would achieve  half a million dollars more was due to the price guide they’d received from a real estate selling agent.    

This is a very public example of why you must keep in mind that most selling agents more often than not overstate what they believe your property is really worth as they are keen to list your property for sale. They know that no one will list their home with the selling agent that quotes them the lowest figure even if it’s the most realistic one, so they tell the vendor the highest price they can loosely justify using a few carefully selected properties that sold in the last six months as comparisons – this is called buying the listing. 

Of course, the agent that gets the job then needs to start to “educate” their vendor pretty soon about the reality of what their home is really worth in order to achieve a sale but it’s all too late if you go off and buy before you have sold as it’s highly likely that you’ll end up with a far lower figure than you were banking on.

If you’re keen to buy first and want a realistic opinion of what buyers will pay for your home in the current market then you’re much wiser to source the opinion of an independent buyer’s agent.

A buyer’s agent has no reason to over-quote to the vendor as they are not trying to list the property for sale.  They have cashed up buyers with finance pre-approval in place looking for properties to buy, and yours might just fit the bill.

These buyers are able to make vendors a genuine offer without the vendor having to sign any selling agreements, put up with dozens of strangers wandering through their home for weeks on end or spend thousands of dollars on marketing which doesn’t guarantee a sale. If the vendor doesn’t like the offer then they don’t have to sell and it's cost them nothing to find out what a real buyer is prepared to pay.

It’s seriously the smartest way to sell!