Selling your home before buying your next property: Pros and cons

Most people sell their current home while simultaneously buying a new one, forming a property chain. While there are risks to selling before purchasing another home, there are also significant benefits. In this article, we highlight the pros and cons of selling your home before buying your next property.

Advantages of selling before buying

1. Seller preference

Sellers almost always prefer a buyer with cash in the bank or a pre-approved mortgage rather than entering a chain contingent on you finding a buyer for your house. Selling your existing home first puts you in a better position as a buyer.

2. Less chance of being ‘gazumped’

Gazumping occurs when a seller accepts an offer from one buyer and then accepts a higher or better offer from another. In Scotland, once a solicitor acting for a seller has accepted an offer, they cannot accept a subsequent offer from another party. If the seller wants to accept a later offer, their solicitor must withdraw from acting on their behalf, and the seller must find new legal representation. Therefore, if you make a reasonable offer, the seller is unlikely to later accept a slightly higher offer if it means entering a property chain.

3. Control over your home sale

If your timetable is not influenced by whoever you are buying from and you don’t need to make a quick sale, you won’t feel pressured to sell for less than the advised value.

4. Stronger negotiating position

With time on your side, those who have already sold their home before buying tend to be in a stronger position to negotiate for a better deal. If the seller wants an immediate move, they may accept a lower offer from you if you can move quickly.

5. You’ll know exactly how much you can spend

Having already sold your property, you will know exactly how much you can spend on your next home. This means your purchase won’t be dependent on achieving the expected price for your existing home. Ensure you’ve accounted for all fees and expenses, including Land and Buildings Transaction Tax, to get an accurate picture of your finances.

Disadvantages of selling before buying

1. Living arrangements

After selling your property, you will need to find somewhere to live before buying your next home. Renting could be expensive and eat into your budget.

2. Storage arrangements

If you rent a smaller place or move in with friends or relatives to save costs, you may need storage facilities for your furniture and personal belongings. This will add to your expenses.

3. Change in house prices

While house prices could drop by the time you’ve sold your house and stayed in alternative accommodation for a while, they may also increase. This could make your ideal property style and location unaffordable.

Deciding whether to sell your home before buying your next property is a personal choice. A TSPC solicitor estate agent can advise you on the local housing market and where prices are likely to go over the next year.

Ready to embark on your selling journey? Get your free property valuation today.