Thinking of selling and buying a house at the same time and wondering how? In the world of real estate, we don’t often see anyone selling and buying a home on the same day. But that doesn’t mean it is impossible. It just requires a fair bit of luck and a good amount of planning and preparation.
How to buy and sell a house at the same time?
It can be quite tricky to wear a seller’s hat and buyer’s hat at the same time. You might have many questions in mind such as where to live between selling and buying, how to deal with your mortgage etc. Below we will discuss a few ways to make the process easy for you.
Extend the settlement period
A simultaneous settlement of two houses on the same day can sound great but it is something difficult to achieve in real life. Since both the settlements are dependent on each other, it can cause problems if one of them is delayed.
A good option to achieve a simultaneous settlement is by having an extended settlement period. For example, if you sell your home first, you can set an extended settlement period of 3 to 6 months in the contract as a condition of sale. During this period, you can buy a new house and complete its settlement. Similarly, if you decide to buy first, you can request an extended settlement period from the seller. This should give you enough time to sell your existing house and do the settlements.
Going for an extended settlement period depends on how flexible the other party is. You can consider offering an incentive to the other party or utilising the negotiation skills of a good real estate agent to make it work.
Offer “subject to completion of sale”
In this option, you buy a house subject to the sale of your own house by putting special conditions into your contract. You only need to pay the money after selling your existing property.
This is a great way to avoid the hassle of finding a place to rent before moving to a new house. So, you are saving huge money and effort by having a place ready to move into after the sale of your current property.
With this approach, an important thing to note is, the seller may still prefer other buyers with no conditions unless your offer is really appealing. So, you may have to go a bit generous with your offer which can tempt the seller to wait for it. You can also think of setting some deadlines in the sale contract to give a certain level of assurance and peace of mind to the seller. This can be specifying a date by which your contract should go unconditional, another date by which your contract should settle, etc. Failing any of these conditions, either party can bring the contract to an end immediately.
If you want to purchase a new house before selling your current one, you can consider applying for a bridging loan. A bridging loan, as the name implies, serves as a bridge between buying a new house and selling your existing house.
A bridging loan is typically an interest-only loan that is charged on your existing loans. Usually, you don’t repay the loan amount during the bridging period and the interest on your existing loans will get added up each month. The sum of these interest amounts will then be added to your final loan amount once your existing property gets sold.
Selling and buying a house at the same time becomes easier with a bridging loan. Usually, It is essential to have a fair bit of equity to qualify for a bridging loan. Various lenders may have different conditions and use different models to calculate the bridging loan amount. It is a good idea to check with the lenders beforehand and know whether you will be able to afford the bridging loan amount or not.
Selling and buying a house at the same time is a major financial decision and you may find it hard to handle them together by yourself. That is why it is important to find an expert real estate agent who can handle this all for you, help you make informed decisions and give you the right advice during each step of the process.
Local Agent Finder helps you find top performing real estate agents in your area and compare each agent based on their marketing strategies, commission rates, sales history, and reviews from other homeowners. A good real estate agent will be able to bring both the buying and selling processes in line, increasing your chances of a simultaneous settlement.
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If you’re planning on selling your house fast and buying a new property at the same time, things can easily get messy and confusing. However, if you stay organised and in control at all times, you can reduce stress levels and prevent significant problems from occurring.
These LocalAgentFinder tips on buying and selling property at the same time will help you to prepare for this process.
Try to nip any “chain” in the bud by choosing a quick sale option. Private sales tend to take longer, and potential buyers may be waiting for their own properties to sell before they can settle. This will draw out the process and may cause you to miss out on buying your dream property.
Auction is swiftly becoming more and more popular as a sale method when it comes to property.
This approach involves setting a date for bids to be entered - and the highest bidder is automatically the new owner of the property in question. This means that, all going well, you’ll know exactly when your property sale is likely to be finalised so that you can get on with the purchasing process.
The main risks here are that there is a chance of your property failing to sell, or selling for a lower price than you hoped (there is rarely room for negotiation at auction).
Another option is to go for a “quick sale” company that will buy the property from you by way of a cash offer up front. There are certain downsides to this option too, as you won’t receive 100% of the property’s market value. However, this approach is very quick.
One of the best ways to ensure a quick sale is to find an agent with a track record of fast turnovers. LocalAgentFinder will help you locate the best real estate agent to sell your house.
Complete all tasks required of you by real estate agents, lawyers, buyers and sellers as efficiently and swiftly as possible. The last thing you want is to be the one slowing the process down.
Keep all important documentation up to date and to hand, and respond to messages and emails as soon as you are able.
We’ve established that getting a sale agreed on your property quickly is important if you’re buying at the same time. The best way to do this is to take action yourself without simply relying on your real estate agent.
Get your home looking as attractive as possible by decluttering, redecorating and tidying up outside spaces. This will help to ensure that the photos used to promote the property are fantastic, and will also make your house appeal more to potential buyers.
You should also share the link to your property’s real estate profile far and wide on social media, on independent listings and anywhere else you can think of. Casting a wide net will help you to find house hunters looking for a property just like yours.
Just as you should try to reduce the chain on your own house, you should prioritise looking for a property that you can move into quickly. Of course, we can’t help which house we fall in love with - but if the one you’re considering has already been vacated - or will be very soon - this will make matters much easier.