Selling and buying a house at the same time may sound daunting but don’t let that put you off.
Putting your home on the market while you look for somewhere new could help you control the process by avoiding a sudden rush to sell when you find the house of your dreams. It can also place you in a far better position when it comes to making a successful offer.
How does the process of selling and buying a house work?
Buying and selling a house at the same time is effectively a collaboration, with everyone involved working towards a common aim.
Time scales can be one of the trickiest things to agree on if they aren’t identified right from the start. Most people will have a red line of some sort when they won’t want to move out – children’s exams, perhaps – so be prepared to be flexible and, above all, make sure the communication is clear at every stage.
Key stages of buying and selling a house
- Get your home valued – it’s important to understand the value of what you have so you don’t overestimate what you can offer when you’re searching for a house to buy.
- Start your property search – what are your priorities? What might you be prepared to compromise on?
- Instruct a solicitor – do this early. Time in preparation is never wasted and, just as you’d declutter and sort through the cupboards, you need to tidy up all the legal threads in good time. Gather together any guarantees relating to the house. Did you get sign-off on that building work? Issues can be sorted out, but it’s far better to do so sooner rather than later when a deal is on the table.
- Line up a building surveyor – again, it’s a good idea to do this early on in the process so you aren’t on the back foot when you find somewhere you’re keen to buy.
- Is your property leasehold? – if so, speak to the managing agent and ensure the management pack is ready.
- Consider the costs – there will be professional fees, stamp duty and moving costs. In addition, check to see if there are any redemption penalties on your existing mortgage. This is something that is often forgotten about.
Is it easier to buy a new house before you sell yours?
In short, no – not if you need the funds from your sale in order to buy. Most sellers want a prospective buyer to be in a proceedable position and by having you own house on the market, you are showing yourself to be a ‘good buyer’.
Buying and selling property at the same time is the best way forward for many people.
The final part of the process is, of course, completion day when money transfers along the chain and keys are released in a domino effect.
And, as at every other stage, preparation for that all-important day is essential. It’s vital to set realistic time frames. When will you be packed up and ready to leave? Who has the keys and how will they be passed on to the new owner? Throughout the buying and selling process, good communication and clearly defined goals and expectations are fundamental to success.
Is it cheaper to buy and sell a house at the same time? The key costs will be the same whether or not you buy and sell at the same time. But it’s important to think about any additional expenses you could incur. Selling then renting before you find somewhere to buy may suit your particular circumstances, but it can be expensive; you may need to pay to put furniture in storage and, since you’re moving twice, you’ll have double the removal costs and upheaval to consider.
Can you buy a house while waiting for yours to sell? You can certainly look at property and show an interest. Most sellers prefer a proceedable buyer.
Can you put an offer on a house before yours is sold? Yes. Agents have a legal obligation to report an offer in writing to their client irrespective of whether or not you are selling and are in a position to proceed. Ultimately, it’s the seller who chooses whether to accept, based on the amount offered and the position of the buyer.
Can I use a bridging loan to buy a new house before mine is sold? A bridging loan is feasible but is likely to be expensive. Also, time has a habit of flying and you may find yourself under pressure to sell, perhaps for less than you’d hoped.
Can I let out my property to buy a new one? Yes you can. There are let-to-buy mortgages out there that allow you to release money from your existing home based on the fact that you are buying with the proceeds. A good mortgage broker can advise. Find out more about letting your property here.
Contact Charles Elsmore-Wickens