You’ve sold your house, but haven’t yet found the one you want to buy and live in – what are your options now?
You’re in a great bargaining position, because you now know exactly how much equity you have to work with, but if settlement dates do not match you may need to find another place to live for a while.
One way to get around the problem is to rent your home back from the buyers for the interim period, though this will only suit if they are not ready to move into the house themselves.
It can also be costly if you have to pay rent equal to the buyer's per diem cost of owning your home (principal, interest, taxes and insurance). If you've owned your home for a long time, your mortgage amount could quite low in comparison to the buyer's mortgage, and your property taxes and insurance premium could also be lower.
If this is the case, then rather than pay a high cost to rent back your home from the buyers, you may be better off moving to an interim rental. The cost of renting will probably be less, particularly if you're living in an area where the rental market is soft.
The additional benefit of moving to an interim rental is that you won't feel pressured to buy a home that doesn't suit your long-term needs.