While both occupancy and closing could <\/i>happen on the same day, the two don\u2019t always coincide. And that\u2019s where confusion can set in, causing frustration for both buyers and sellers.<\/p>\n
We asked top Washington real estate agent Greg Barkley<\/a>, who sells homes 19% quicker than the average Spokane agent, about how mix-ups around occupancy dates affect sellers. Barkley shares his advice about how sellers can avoid occupancy date confusion and what they can do to avoid extra stress on moving day.<\/p>\n According to Barkley, setting the occupancy date is \u201cjust part of the negotiation\u201d process. For instance, the seller may negotiate for an occupancy date weeks after closing if they know in advance that they\u2019ll need extra time to move out. Other times, something could happen in the middle of the deal (such as a lender delay) that requires the seller and buyer to renegotiate the closing and occupancy dates.<\/p>\n Before you agree to an occupancy date, keep these tips in mind:<\/p>\n When do you have to move out? It depends on your agreement with the buyer. The purchase agreement<\/a> specifies both the closing date and the date the buyers will be able to move in.<\/p>\n It can take 49 days on average to close a purchase loan<\/a>, according to an April 2021 report issued by ICE Mortgage Technology\u2122. In this case, an occupancy date that falls on the same date as closing will give you approximately 49 days to pack up your things. Your timeline may differ, depending on your local market and the terms you negotiate with the buyer.<\/p>\n For example, cash buyers don\u2019t need to wade through a loan process, which can speed up the closing timeline. Cash transactions can close as quickly as one to two weeks<\/a>. If you\u2019re confronted with an accelerated closing, consider negotiating an occupancy date that falls after your closing date. Doing so will give you more time to move.<\/p>\n There are also cases when the buyer requests early occupancy<\/a> or a move-in date before the title transfers. If you agree to early occupancy, you\u2019ll have fewer days to clear out of the home.<\/p>\n To give yourself extra time to move after your home sale closes, you could negotiate a seller lease-back. The agreement would allow you to stay in your home for a set period after ownership transfers. Negotiating a sell and lease back home<\/a> agreement can help you avoid moving twice \u2014 first to temporary lodgings, then to your new home.<\/p>\n If you\u2019re hoping to negotiate a seller lease-back, you\u2019ll need to keep the buyer\u2019s lending requirements in mind. Some lenders require the buyer to occupy their new home within a certain time frame after closing. Fannie Mae, for example, requires the buyer to move in within 60 days<\/a>. In such cases, the buyer wouldn\u2019t be able to accommodate your request to remain in the home beyond then.<\/p>\n Even if the buyer and seller are on the same page about the day the buyer will occupy, confusion can occur if the parties don\u2019t specify an effective occupancy time in the purchase agreement. Does the buyer have the right to move in at 10 a.m., or is it 10 p.m.? If you fail to set a time, your buyers might show up with a moving truck before you\u2019ve cleared out.<\/p>\n And to make matters worse, the buyers may accuse you of breaching the terms of the purchase agreement. If the buyer doesn\u2019t agree to an extension of time, they could take legal action and sue for damages. If closing hasn\u2019t occurred, the buyer could also terminate the purchase contract due to a contract breach.<\/p>\n Barkley shares that while Washington state\u2019s standard purchase agreement sets the move-out deadline at 9 p.m., he\u2019s witnessed buyers overlook occupancy time. \u201cBuyers may assume that they get to move in as soon [as the loan] funds and records, which might be 2 o\u2019clock in the afternoon,\u201d he warns. \u201cThey\u2019ve either forgotten, or it wasn\u2019t explained to them that the sellers can take until 9 p.m. to [move out].\u201d<\/p>\n Best practice? As you near the buyer\u2019s date of occupancy, remind them (through your real estate agent) that you\u2019ll be out of the house by the time listed in the purchase agreement.<\/p>\n The amount of leverage you\u2019ll have negotiating for your ideal occupancy date largely depends on if you\u2019re in a seller\u2019s market or a buyer\u2019s market<\/a>. While you\u2019ll have more sway in a seller\u2019s market, negotiating extra move-out time in a buyer\u2019s market might not be so easy. In a buyer\u2019s market, \u201cthings work out more in the buyer\u2019s favor, and if the buyer wants to move in sooner, then that’s probably how that negotiation is going to go,\u201d says Barkley. If you can\u2019t agree on a later date, you\u2019ll need to figure out how to expedite your moving plans.<\/p>\n Once you and the buyer agree on an occupancy date, you\u2019ll want to put your moving plans into motion. The last thing you want is to underestimate how long it will take you to pack, increasing your moving day anxiety. Plan a seamless move following these tips:<\/p>\n Barkley advises his clients to start packing<\/a> before their home even hits the market. It\u2019s part of the staging process to make the house presentable for buyers.<\/p>\n First, \u201cwe get rid of the clutter,\u201d he says, by clearing items off countertops and removing excess furniture. Then, he suggests that sellers box up \u201cstuff they can do without for the next 30 or 40 days.\u201d\u00a0 After that, \u201cit should just be a continuous process.\u201d<\/p>\n You can store packed boxes in the garage and closets \u2014 prospective buyers take pre-packing as a positive sign that the seller is ready to close a deal ASAP.<\/p>\n By getting a head start, you won\u2019t be overwhelmed with having to pack everything at once. Hopefully, you\u2019ll avoid any last-minute packing rush as the buyer\u2019s occupancy date nears.<\/p>\n If you\u2019re moving during peak season, such as the summer months, you may want to book your moving company or truck before you lock in the occupancy date. That way you\u2019ll know your moving service of choice is available in time. During peak periods, Movers.com recommends booking your movers two months in advance<\/a>.<\/p>\n![\"A](\"https:\/\/www.homelight.com\/blog\/wp-content\/uploads\/2021\/05\/occupancy-date-phone-666x381.png\")
<\/a>1. Negotiate a buyer occupancy date that works for you<\/h2>\n
2. Understand the closing timeline \u2014 and when you have to move out<\/h2>\n
3. Negotiate for a lease-back if you need more time to clear out<\/h2>\n
4. Clarify whether the buyer\u2019s lender has occupancy date requirements<\/h2>\n
![\"A](\"https:\/\/www.homelight.com\/blog\/wp-content\/uploads\/2021\/05\/occupancy-date-watch-666x381.png\")
<\/a>5. Specify an occupancy time in addition to the date<\/h2>\n
6. Know that market conditions influence occupancy date negotiations<\/h2>\n
![\"A](\"https:\/\/www.homelight.com\/blog\/wp-content\/uploads\/2021\/05\/occupancy-date-box-666x381.png\")
<\/a>Occupancy date all set? Jump-start your move and avoid procrastination anxiety<\/h2>\n
Start packing as soon as you find a buyer \u2014 or sooner<\/h3>\n
Book your moving company before you set the date in stone<\/h3>\n
Consider storage units or PODS<\/h3>\n