Should I Buy My New Home Before I Sell My Current One

 

When you’re selling your home it’s likely that your ideal situation would be to sell it quickly after putting it on the market.

15 March 2022

However, this is not always the case and if you find a home you want to purchase before you secure your sale what are your options?

Can you buy a new house before you sell your old one?

Are You Allowed to Buy a House before Selling the Old One?

Buying and selling a property can be time consuming and stressful especially if you are in a chain. 

If your next purchase is dependent on the finances being released from your current property you will need to sell it before you can complete on the purchase of your new home. This doesn’t mean you can’t look and put an offer in on your next home but the transactions will be tied together so your current sale and on-going purchase happen at the same time. 

If you are in a financial position where you do not need to sell your current property before buying, then yes you can press on with the purchase. In this case you might be considered a more desirable buyer as you won’t be tied to a chain. 

You do need to consider some downsides. Your purchase will be classified as a second home, so you might have to pay higher stamp duty. Additionally, you’ll have to pay capital gains tax on the new house. And lastly, you have to make sure that you have the financial ability to take out a second mortgage.

Should I Wait to Sell before Buying?

On the flip side, you can also sell your house first before purchasing a new one. However, you should ensure you have somewhere to temporarily stay before you acquire a new home.

The advantage of this decision is that you can take time to find the perfect home for you. There won’t be an onward chain that will pressure you to sell your home, which can appeal to prospective buyers. Overall, the reduction of stress in balancing buying and selling at the same time will also make the process much more manageable for you and your family.

However, aside from the stress of finding temporary accommodation, you must also be ready for the disruption in your day-to-day activities and in effect 2 moves!