Buying and selling at the same time

Start with the numbers

Before choosing an approach, know roughly what your current home could sell for and what you could spend on the next one. A comparative market analysis gives you a realistic price range. A lender can tell you how much you can borrow, whether you can carry two mortgages for a time, and what bridge options exist. With those numbers, the right approach is usually clearer.

Option 1: Sell first

Selling first gives you certainty about your proceeds and makes you a stronger buyer, because your purchase won’t depend on another sale.

• Rent-back: negotiate to stay in your home for a period after closing, renting from the buyer. This gives you time to find and close on your next home.
• Temporary housing: if a rent-back isn’t possible, plan for a short-term rental and storage.
• Trade-off: you may move twice, and you’re buying without the proceeds-related pressure but on a timeline.

Option 2: Buy first

Buying first lets you move once and take your time preparing your current home for sale.

• Bridge financing or a home equity line: can provide the down payment before your current home sells, at a cost.
• Carrying two homes: be sure you can afford both payments if your sale takes longer than expected.
• Trade-off: more financial risk, but the move is simpler, and you can prepare and stage your current home while it’s empty.

Option 3: Line them up

Many movers try to close both transactions within days of each other.

1. 01Contingent offer: make your purchase contingent on selling your current home. It protects you, but sellers may prefer non-contingent offers, especially when they have several.
2. 02Coordinated escrows: list your home, accept an offer with a closing date that matches your purchase, and negotiate a short rent-back or delayed possession if needed.
3. 03Backup plans: agree in advance what happens if one side is delayed, such as an extension, a rent-back or temporary housing.

Coordinating works best when both transactions are with agents who communicate closely. Dan can handle both sides of your move.

Taxes and costs to plan for

• Capital gains: many homeowners can exclude a significant amount of gain on the sale of a main home if they meet ownership and use tests. See IRS Topic 701 and ask a tax professional.
• California withholding: some sales require state income tax withholding at closing unless an exemption applies; escrow will ask you to complete the forms.
• Proposition 19: eligible homeowners 55 and older may be able to transfer their property tax base value to the new home.
• Transfer taxes and closing costs on both transactions, which vary by county and city.

Our guide to moving between Sacramento-area counties explains how taxes and utilities change across county lines.

Preparing both sides

On the selling side, prepare your home early: repairs, disclosures and presentation, as described in preparing your home for sale. On the buying side, get pre-approved, use our home comparison method, and know which homes you’d act on quickly. Dan’s selling process and buyer guidance explain each side in more detail.

Contact Dan to map out a timeline that fits your situation.

Tax and financing information here is general. Talk to a lender and a tax professional about your circumstances.

Common questions

What is a rent-back?

It is an agreement that lets the seller stay in the home for a set time after closing, usually paying rent to the buyer. It helps sellers bridge the gap between selling and moving into their next home.

Will sellers accept an offer contingent on my sale?

Sometimes. It depends on the market, the seller’s situation and the strength of the rest of your offer. A home already listed or in escrow makes a contingent offer more appealing.

Do I pay capital gains tax when I sell my home?

Many homeowners can exclude some or all of the gain on a main home if they meet IRS ownership and use tests. Your situation depends on the details, so check with a tax professional.

Official sources

Records and rules are parcel-specific, so look up the exact address with the responsible agency.

• IRS Topic 701: Sale of your homeFederal rules on excluding gain from the sale of a main home.(opens in a new tab)
• Franchise Tax Board: real estate withholdingCalifornia withholding on the sale of real property.(opens in a new tab)
• California BOE: Proposition 19Base-year value transfers for eligible homeowners.(opens in a new tab)
• CFPB: Buying a houseFederal guidance on loan estimates, closing costs and shopping for a mortgage.(opens in a new tab)
• California Department of Real EstateConsumer information and license lookups.(opens in a new tab)

Local rules, districts and fees change. This guide is general information, not legal, tax, insurance or lending advice, and it describes places by property, travel, costs and services, never by who lives there.