To Buy or Sell first…that is the question! Which we answer!

With Perth listing levels at it’s lowest in years, many owners with short to medium term plans to sell are now asking two key questions.

Is it the right time to move? And if I'm ready to take the plunge, should I buy first and then purchase or vice versa?

While upgrading your property can be exciting, some decision making can be a little stressful. We believe the best way to weigh your options is to plan, as the saying goes “if you fail to prepare you must prepare to fail.”

It is a strong market at the moment, so it limits the risks, but when you are ready to pull-the-trigger you have to be ready.  This is the general market advise.

Buying first

• Risk equation: If you buy first, you should be confident you'll sell your current home on schedule and at the anticipated price.
• Back-up cash: If events go sideways, you'll likely need a bridging loan to tie you over because you'll own both properties in this scenario.
• Rent option: With no sign of a buyer, you can rent to generate income to help cover the bridging loan costs. If this works, you can delay a sale until the market picks up further.

Selling first

• Safety first: You limit your risk by selling first, and you'll know exactly how much you can spend on your next home.
• Timing is everything: You'll have some control over events, influencing the settlement time to suit your needs. You can even ask your buyer for an extended settlement period to allow you time to find your next home.
• Nowhere to go: Life isn't always perfect. Just because you sold first doesn't mean you'll find your next home quickly. Rather than rush into a purchase, be prepared to rent while you complete your search. However, with Australia experiencing a shortage of rental properties, that's an additional challenge.
• Exiting the market: The property market moves quickly, and you could find yourself scrambling if there's a sudden upturn. The worst outcome is discovering you can no longer afford the style and size of property you'd set your heart on.

Now to my advice, the best way to get to your destination is the following steps:-

BUY FIRST

1. Call me
2. Get your home ready for market
3. Go out and buy a home, place an offer (I will structure the offer)
4. Immediately pull the trigger and go live on the sale of your home.
5. Receive your offer (no subject to sales allowed, I will structure the offer)
6. Settle congruent with your new home.

SELL FIRST

1. Call me
2. Get your home ready for market
3. Pull the trigger and go live on the sale of your home
4. Actively look for your next home
5. When you receive an offer structure it in such a way that you will not be displaced, whilst finding your next home (I will structure the offer)
6. Place offer on new home (I will structure the offer)
7. Settle congruent with your new home.

These both sound straight-forward but the devil is in the contract detail. I have structured many deals for my homeowners that saw them safely in their new home with little risk.

WHAT TO AVOID

Bridging Loans – don’t let an Agent convince you to get a bridging loan. Rates are higher than standard mortgages, and they can blast a hole in your budget especially if your current home takes longer to sell than anticipated.

2023/2024 is shaping up to be the ‘year of the move’ especially for those who have been on the precipice since 2019, so to get an action plan in place, call me, Paulette Contessi 0438 908 264 today.

Paulette Contessi

Licensee / Director

THE CONTESSI GROUP