In the UK most home movers do this:
Placing such pressure on making your sale is a risky strategy and in many cases it leads to homeowners selling for less than they deserved.
By selling before you buy you put yourself in a strong negotiating position when dealing with prospective buyers.
This is true because:
By selling before you buy you put yourself in a strong position when making offers to vendors. You'll be a preferred buyer.
This is true because:
Here are the 2 main risks associated with selling first:
Most seasoned sellers don't mind mind renting. They've been part of a chain before and know that renting (although mildly irritating) is in reality a far less stressful proposition.
Modern removal companies make these double moves. They take your belongings and safely put them into discount storage while your renting. When you've found your new house the removals company will collect your belongings and bring them to your new home.
If you're not prepared to rent for any length of time you will have to make it clear to buyers that you will only accept their offer on the condition that you find a suitable property to buy.
Ask yourself how much time you think you'll need. Then try and agree that period with your buyer.
In return for your buyers patience, you'll take your house off the market and promise not to sell to anyone else.
It's perfectly possible that you may not find a suitable home to buy within the negotiated time period. Or you feel that values have moved on since you first agreed a price ∧ now your agreed sale price is looking a little light.
In both these situation you and your buyer need to sit down and renegotiate.
If your buyer won't renegotiate you will have to put your property back on the market and start again. This will sting a bit but it won't sting nearly as much as underselling for £10Ks.
Tip No.1 - Do Your Research!
Before putting your property up for sale make sure you know:
Next thing to do is put your property on the market and wait for a decent offer.
Once you've snared a buyer (or have started to attract a steady stream of positive viewing) start your house hunting efforts in earnest.
Really put yourself out there, hassle estate agents constantly and make yourself available to view every (& any) suitable property.
Tip No.2 - Choose a Good Conveyancing Solicitor!
A good conveyancer is:
A good solicitor will help you control the pace of a transaction. They can speed things up when needed but more importantly they can slow things down if you need more time to find that new home.
When you're selling property your solicitor, not your Estate Agent (if you bother to use one), will be your greatest asset!
First of all, expect to be gazumped (you are now in the situation where it is most likely to happen).
Second of all, expect to pay over the odds to secure the house you want!
Of course you may get lucky and avoid both these things. But ask yourself this:
Would you take your house off the market for a buyer that still had to sell their house (i.e. a buyer that's not really ready to buy)?
Wouldn't that buyer have to offer you more money than someone who was ready to proceed immediately?
Thirdly, you'll have to take out a Bridging Loan facility in order to finance your purchase and this will be:
Typically your repayments will be between 0.75%-1.25% of the loan amount (per month) + fees. That can add-up quickly.
If you can't sell your property and have to pay-off your mortgage and bridging loan for any sustained length of time it can be crippling.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
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