Choosing whether to buy or sell first is truly a personal choice based on your individual circumstances.
Deciding whether to buy or sell a property first is a crucial conundrum that confronts many homeowners, each option carrying its own set of advantages and challenges. The real estate market is dynamic, influenced by various factors such as location, market conditions, and personal circumstances.
We’ve looked at the pro’s & con’s of each scenario.
Selling First
- You’ll know the exact amount of money you will have to put towards your next purchase.
- You’ll have less urgency to sell in a hurry, so you can wait until you are happy with the sale price of your property.
- There isn’t a need to apply for a bridging loan to finance both properties. You won’t be in the position of having to pay two loans at once.
- There may be nothing suitable on the market when you need to buy. You could end up having to move out with nowhere to go.
- You might have to pay for rent and have the added expense and hassle of having to move twice.
- Prices might go up after you sell and you might be priced out of the market, or not able to find the dream home for the right price.
Buying First
- You could avoid moving into a rental property and multiple moving fees. You could avoid having to find a new house to buy in a hurry.
- You could take advantage of a rising market and potentially get more for your money, and make more from your subsequent home sale.
- You may need a bridging loan in order to finance the new property. You’ll have the extra cost and stress of having to repay two mortgages at once.
- It may force you into selling your original property at a lower price, if you need the money to meet your loan obligations. Bridging loans must be repaid within 12 months.
- If you can’t sell your existing home for the price you need or expected, you may have to source additional funds to cover the shortfall.
- If you’re making a conditional offer on a property, you might need to make a higher offer to convince an owner to hold the property while you sort out your circumstances.
