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The anticipation of moving to a new home is a really exciting time, you get a fresh start with a brand new property. However, when you buying and selling a home at the same time, along with the excitement, you can also face a fair bit of stress.
We’re here to help though, as we highlight some of the things you should look to avoid and steps you can take to make your experience run as smoothly as possible.
Should you sell your house before buying?
Most people need to use the money from their existing home in order to buy a new property. That usually rules out buying your new home before selling. You could however sell your house before buying a new one. Although you’ll have to find somewhere to stay and store your things when you sell, this method can be less stressful and put you in a strong position as a buyer.
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Get a conveyancing quote
Be ready to instruct a conveyancer whether selling your house first, or waiting to buy and sell at the same time.
Can you offer on a house before selling?
Absolutely. Sellers may be more wary of your advances, but you can make a contingent offer which specifies how long you need to make good on your offer, and protects you from having to take on two mortgages at once. You’ll need to show a vendor you’re serious by putting your current home on the market, preferably before you make an offer on a new property. The sooner your existing home’s under offer, the more seriously your own offer will be taken.
Should you avoid a chain when buying and selling a house?
Operating without a chain is the most desirable way to buy and sell, however it’s often unavoidable. You should try to minimise your chain as much as you can though. A long chain that depends on a large number of sales going through is more likely to break down, compared to one which only has a few people in it.
Find out more about what being chain free means and the benefits.
Do you need a deposit when buying and selling a house?
Every house purchase requires a deposit at exchange. If you’re selling your home, your buyer’s deposit usually covers this. If it doesn’t, you may have to come up with some extra cash for a deposit, but your conveyancer can advise you on this.
How long do you have to reinvest money from the sale of a house?
Your home is classed as a capital asset, and when you sell it for profit, it may be subject to Capital Gains Tax. There are certain exceptions to whether you have to pay this charge though, while there are also time constraints on how long you can own two properties before you have to pay tax. This is currently 18 months, but if you’re exempt from paying Capital Gains, there’s no time restriction on reinvesting the money from selling your home.
If you are concerned, you should seek the advice of a tax specialist as soon as possible.
Can you transfer a mortgage from one property to the next?
Yes, this is usually possible with most mortgages, and is called porting your mortgage. This can be a good way of retaining a strong interest rate and avoiding an early repayment charge when you buy a new home. You still have to apply for the mortgage so the lender can reassess the affordability, while your new property will be valued too. If you want to borrow more money, you’ll have to apply for the extra funds separately and blend the two rates together.
How can you plan for a house sale falling through?
Whether a buyer discovers something wrong with a property, something goes awry on the mortgage front or the seller’s personal circumstances change, there are lots of reasons why house sales fall through. It can be upsetting and costly, but there are ways to protect yourself, whether you’re buying or selling. From comprehensive surveys to minimising the size of your chain, being open to compromise on relatively minor issues and ensuring your finances are in great shape for your mortgage. Read more about how to protect yourself in our guide to gazumping, gazanging and gazundering.
Should I get a mortgage advisor?
Knowing how to handle buying and selling a home at the same time isn’t the easiest thing in the world. If you’re feeling overwhelmed or just want another professional in your corner during the process, it could be a good idea to get a mortgage or financial advisor on board. Advisors can help you navigate the things you need to do, while choosing a reputable conveyancer is also crucial to help with this.
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