What is a contingency?
Simply put a contingency is a clause in the contract between the buyer and seller that something must happen prior to closing.
In the Denver Housing market when we talk about a “contingency” it means someone must sell a house first before they can buy their next home.
If we are in an extremely low inventory market or a “seller’s market” seller’s don’t like to see this because if the buyer cannot sell their home prior to this one closing the buyer will back out and the seller will have to put their house back on the market.
Remember there are exceptions to almost every rule in Real Estate and almost everything is negotiable.
There could be that one seller who also needs to sell before they buy and they know the buyer’s house will sell quickly so they might take that chance. But then again, if they are receiving multiple offers, it might not make sense to take that chance.
But back to the original question… a contingency is the clause in the contract that states the buyer has to sell their house on 123 Main Street before they can purchase a new home.
There are alternatives to writing in a contingency.
If you get your house on the market and sold, you can ask for a Post Occupancy Agreement. Or you can find a short term rental or even a 6 to 12 month rental and take your time to find what you want next. It’s easier to buy when you don’t have a house to sell.
Does your house needs some updates or refreshing? I’ve got some tips for you.
I’ve helped buyers and sellers for over 21 years in the Denver market. Message me so I know how I can help you.