If you have a lease ending this summer and you are thinking about buying a home instead of renewing that lease, you might think you have PLENTY of time before you need to start looking for a home to purchase.
You might actually want to start looking for that new home sooner than you think.
Let's imagine that your lease ends June 30th.
Here's one potential timeline...
- February 1 - start viewing houses
- April 1 - secure a contract on a house
- May 31 - close on your purchase of the house
- Month of June - leisurely move into your new home
A few details worth mentioning...
- You'll see I have a 60-ish day period noted above (Feb 1 - April 1) for securing a contract on a house. It is certainly possible that you could find a house and secure a contract on that house more quickly than 60 days, but it could also take longer than that. Many segments of the local market are significantly out of balance with many more buyers than sellers in the market. Even if you start making offers on houses in February, it might take some time before you are the winning buyer in multiple offer situation after multiple offer situation. Give yourself some time to not only find a house that you want to buy but actually be the one that gets to buy it based on high levels of competition from other potential buyers.
- There is also a 60 day period between securing a contract on a house and closing on the purchase of that house. This is normal. Most closings happen 45 to 60 days after the contract is signed. It is possible that a lender and title company can make it happen faster than 45 days but that is not necessarily likely given the current high volumes of purchases and refinances that are keeping lenders and title companies quite busy!
Finally, one thing that is not noted above is how this might all play out related to your monthly housing payments...
- February 1 - start viewing houses
- April 1 - secure a contract on a house
- May 31 - close on your purchase of the house
- June 1 - last rental payment
- Month of June - leisurely move into your new home
- July 1 - first mortgage payment
As you can see, above, in this scenario (closing on home purchase on May 31, lease ends June 30) you would not have any months where you would need to both make a rent payment and a mortgage payment.
So -- if your lease ends this summer, and you are looking to buy, you might want to get started on the buying side of things sooner rather than later!
Recent Articles:
