9 benefits of buying before you sell
The age-old question for homeowners looking to make a move is whether to buy their next home before selling their existing one or vice versa. While there are pros and cons to both approaches, there are compelling reasons to consider buying your next home before selling your current one. In this article, we'll explore the benefits of a buy first strategy and why it could be the right choice for you.
1. Buy the home you really want
One of the primary advantages of buying your next home before selling your existing one is that it allows you to take your time in finding the perfect new property. Rushing through the home-buying process can lead to making decisions you later regret.
When you already have a place to live, you can be patient and wait for the perfect property to hit the market.
Finding the home is only half the battle. The other half is actually being the winning offer. Getting pre-approved to be able to buy first will allow you to move fast to secure it once it hits the market.
2. Submit strong offers with fewer conditions
When buying a new home you often include conditions on your offer. Two common conditions we see are financing and subject to sale.
While these conditions provide some protection, they can also make your offer less appealing to sellers, especially in competitive markets. Getting pre-approved to buy first can eliminate the need for these conditions, making your offers stronger and more attractive to sellers. However, you should be guided by the advice of your conveyancer or professional advisor before deciding to remove any conditions.
Similarly sellers might have their own requirements for specific settlement timeframes, being pre-approved to buy first gives you the flexibility to meet these requirements and make yours the winning bid - it's not always about the price.
3. Maximise the price of your current home
Great presentation and running an effective marketing campaign are essential to maximising the sale price on your existing home. When you buy your new home first, getting the repairs, landscaping and staging your home are all easier because you won’t be living there.
Additionally, being able to accommodate multiple inspections for prospective buyers at any time can make the marketing campaign faster and more effective, potentially resulting in a quicker and more profitable sale. It also means you don’t have to frantically clean the house twice a week for inspections!
4. Better negotiating power on your current home
While presentation and marketing are key to maximising the sale price on your current home, ultimately attracting the most bidders increases competition and, therefore, price.
When you have already secured your next home with a buy first solution, you are in a stronger position to be flexible on the terms of the sale of your existing one. Typically, you can wait for the right buyer and the best offer, rather than feeling pressured to accept the first reasonable offer that comes along.
This added flexibility can often lead to a higher sale price and more favourable terms for your current property.
5. Avoid market fluctuations
Real estate markets are notoriously unpredictable. You should keep in mind the variability of the housing market. There is a risk that the property market may increase or decrease materially between selling your current home and buying your new home.. For example, if you are not able to find and secure a new home within a reasonable time period, and property values increase, this could impact whether you will be able to afford the type of property you were hoping to buy.
The key to managing the risk of market movements is transacting in the same market. Buying first can help put you in control of the process so you can best determine how to manage this risk.
6. No need for temporary accommodation
Moving is often cited as one of life's most stressful experiences, but buying your new home first can significantly reduce that stress. One of the biggest sources of stress when selling first is wondering where you’ll live if you can’t line up the sale and purchase of your properties pretty much perfectly.
Finding a short term rental is notoriously hard and can be expensive. Your application tends to move towards the bottom of the pile as soon as they know you’re not a long term tenant.
And if you’re thinking about moving in with family and friends for a little while until you find your next home, just know that can put a lot of stress on your relationships if things don’t go as planned. We’ve heard too many stories about people moving in with their friends or family for what was supposed to be a few weeks, only to find themselves still living there 6 months later.
Even in today’s age of digital settlements, delays can sometimes occur, impacting the best laid plans. A reasonable buffer should be considered in the timing of your buy first strategy.
7. No need to live through renovations or repairs
If your new home needs some renovation or repairs, buying it before selling your existing home is the way to go. You can take your time with renovations, avoiding the rush to complete them while living in the property.
This ensures that the work is done to your satisfaction and on your schedule, without the need to juggle the needs of a buyer or the constraints of a settlement date. It also usually means the work can be completed faster, which can save you some money.
8. Make the transition smoother
Moving from one home to another can be logistically challenging. However, buying your new home before selling your existing one allows for a smoother transition. You can gradually move your belongings, make necessary repairs, and set up your new home before saying goodbye to the old one.
Buying first can reduce the chaos and disarray that often accompanies a rushed move.
9. Minimise the disruption to your family life
If you’re a parent with kids at home, you’ve got even more to consider when moving home. It’s not just the homes, it’s your kids' schools, sports, friends, and other activities. Keeping your home clean for showings, doing any repairs or renovations while your kids are living in the home, and only having to move once can be a huge benefit for the entire family.
Many families we speak with would give an arm and a leg to minimise these types of disruptions to their family life. A buy first strategy may help in these circumstances.
While the decision to buy your next home before selling your existing one may not be suitable for everyone, it offers numerous benefits that can provide more freedom, flexibility and choice.
By taking your time to find the perfect new home, avoiding rushed decisions, and gaining more negotiating power, you can create a more comfortable and secure path to your next chapter of homeownership.
Buying first gives you more control of the timeline, allowing you to mitigate the risk of not transacting in the same market.
Ultimately, it's essential to weigh-up your unique circumstances, market conditions and goals to determine if this strategy aligns with your needs and preferences. We encourage you to explore all available options and seek professional advice before making any decisions. The team at Doorsteps Finance are committed to helping homeowners buy first.