6 Costly Mistakes to Avoid When Upgrading to a Larger Home

Upgrading to a larger home while already owning one presents a different set of challenges than buying your first property. Timing, financing, and coordination all play crucial roles in ensuring the transition goes smoothly. If not handled properly, you could find yourself juggling two mortgages—or worse, without a home during the interim between closings. Before listing your current home, it's essential to understand and prepare for these challenges.

This guide outlines six of the most common mistakes homeowners make when moving up to a larger home—and provides strategies to help you avoid them.

1. Wearing Rose-Coloured Glasses

Many homeowners get swept up in the dream of a bigger, better home without grounding their expectations in financial reality. It’s easy to fall in love with a property that’s either already sold or outside your budget. Instead of using a hit-or-miss approach, consider working with an agent who offers a Buyer Profile System or “Househunting Service.” These programs match your criteria with all available listings and provide you with regular updates, helping you stay focused and realistic while still working toward your dream home.

2. Neglecting Necessary Home Improvements

To maximize your selling price, your current home should be presented in its best light. This doesn’t always require costly renovations—often, small updates can significantly boost perceived value. Even modest investments can yield major returns at closing. Prioritize these enhancements before listing your home. If budget is an issue, you might explore an equity loan that can be paid off once your home sells.

3. Buying Before You Sell

It’s generally smarter to sell your current home before purchasing a new one. Otherwise, you risk making a rushed decision or accepting a low offer just to meet a deadline. Selling first allows you to negotiate your next purchase without added pressure. If you receive a strong offer but haven’t yet found a new home, consider adding a contingency clause giving you time to buy. Alternatively, if the market is slow, renting out your home until you’re ready to sell might be a viable option—just be sure to review the tax implications. Even better, look into programs that guarantee the sale of your home (see mistake #5).

4. Skipping Mortgage Preapproval

Mortgage preapproval is a quick and easy step that many buyers overlook. It’s free, carries no obligation, and provides a clear picture of what you can afford. A preapproved buyer is far more attractive to sellers—sometimes even beating out higher offers that are contingent on financing. Knowing you have lender approval in place gives you both confidence and leverage in negotiations.

5. Falling Into the “Real Estate Catch-22”

The classic dilemma: should you buy first or sell first? While selling first is often recommended (as discussed in #3), there are solutions that eliminate the risk altogether. Some agents offer Guaranteed Sale or “Trade-Up” Programs that promise to buy your current home if it doesn’t sell in time—giving you the freedom to secure your next home without anxiety or delay.

6. Mishandling Closing Coordination

Buying and selling simultaneously involves multiple professionals—loan officers, lawyers, appraisers, inspectors, title agents, and more. Miscommunication or poor timing among these parties can lead to frustrating delays or even derailed deals. The key to avoiding these pitfalls is close coordination with a knowledgeable real estate agent who can manage timelines and keep all parties on track.