Sell First or Buy First: Strategies for Upgrading Your Property

Introduction

Upgrading your property involves making critical decisions, especially regarding whether to sell your current home first or buy a new one upfront. Let's delve into the strategies and considerations to help you navigate this process smoothly.

Sell First, Buy Later Strategy

Selling your current property before purchasing a new one offers several advantages:

1. Competitive Offer: Without the need to include the sale of your current property as a condition, your offer becomes more attractive to sellers. This approach can be particularly advantageous in a sluggish housing market where properties may take time to sell. Even if your offer is slightly lower than others, sellers may prefer a less conditional offer to ensure a sale.
2. Clear Budget: Selling your current property prior to buying a new one provides you with a precise comprehension of your budget. This clarity aids in accurate budget planning for your new property, as you'll have a clear idea of your down payment from the sale proceeds along with any pre-approved loan amount from the bank, helping you determine a suitable price range for your new property.
3. Market Advantage: In a sluggish housing market, a non-contingent offer can be more appealing to sellers, increasing your chances of securing a purchase.

However, this strategy has its drawbacks, including potential challenges in finding a new property promptly and the inconvenience of temporary accommodation if there's a gap between closing dates.

Buy First, Sell Later Strategy

Purchasing a new property before selling your current one also has its merits:

1. Continuity: Ensures you always have a place to live without the need to move until you find a suitable property to replace it. This approach is suitable for those with specific requirements or who are not in a rush to buy immediately.
2. Maximize Profit: In a rising market, buying before selling can lead to selling high and buying low, maximizing your gains.

However, this approach may result in less competitive offers when purchasing, and the uncertainty of the final selling price of your current property can make budget planning challenging.

Conclusion

Deciding whether to sell first or buy first when upgrading your property depends on your unique circumstances and preferences. Consider factors such as market conditions, budgeting needs, and the availability of suitable properties before making a decision. For personalized advice and tailored solutions, reach out to real estate professionals to ensure a smooth and successful property upgrade.

Disclaimer: The content in this article are provided for general situation purpose only. To the extent that any such information, opinions, views and recommendations constitute advice, they do not take into account any person’s particular financial situation or goals and, accordingly, do not constitute personalised financial advice. We therefore recommend that you seek advice from your adviser before taking any action.