Tips from Stuart Oliver from Fine & Country Bristol
There are many things to consider when buying a new property and selling your current home. It pays to have a good strategy in place. Stuart Oliver, Senior Partner from Fine & Country Bristol gives some tips on where to start.
In an ideal world, when you decide it’s time for a change of property, you would be able to buy a new home, move, and then sell your old home. This is the preferred option for people who like to plan ahead, and who enjoy the security of having the future line up. It gives you time to hold out for what you want, as you won’t feel pressured into settling for a home that’s less than perfect. It also eliminates the need for temporary housing while you are between places, reducing the expense associated with your move.
The down side is that this requires significant financial reserves, or a seller who’s willing to accept an offer contingent on a subsequent sale. In a competitive market, this is a disadvantage and paying two mortgages, or owning two properties is not feasible for many.
Selling and buying simultaneously, on the other hand, can mean double the work and significant stress. Being both a buyer and a seller is difficult, and even more so when you’re trying to time a sale with the purchase of a new home. Realistically, it’s unlikely you will close on a new home the same day you sell your old home. You're at the mercy of the market and potential buyers and sellers. If your home sells quickly, you may feel pressured to leap into your next home purchase, which is not ideal. There are ways to line up these dates, but chances are, you'll have to focus more on either buying or selling as the first step.
There are several advantages to selling your home before buying. Perhaps the most important is that you know how much money you have to work with. If you buy then sell and overestimate the value of your current home, you may face a shortfall. If you sell first, this eliminates the risk. It's also easier to get a new mortgage when you've sold your old home and you have the opportunity to make a cash offer on your new property, which can give you a competitive advantage in a hot market or secure a better price.
While selling first seems like the best bet, it’s preferable to begin by looking at the market. Research prices in the areas where you're both buying and selling and look at whether the market is favouring sellers or buyers. As a general rule, you want to sell first in a buyer's market and vice versa, to optimise your position. Remember the market can change quickly and you don’t want to risk a price hike between your sale and purchase times. The starting point should be a discussion with your estate agent to determine the state of the market and your optimal buy and sell strategies.
For advice on selling or buying property, please contact Fine & Country Bristol on 0117 9461946 or visit www.fineandcountry.com