Like with any question, there will be many deciding factors based on your situation and external circumstances, so it is difficult to provide an answer that will appeal to everyone.
By rule of thumb, when the property market is active, and there are more buyers than there are homes available, the risk factor f buying before selling is low.
If you price your home realistically and you are working with a good agent who can create competition and negotiate up, you will have a successful transition.
Buying before selling
If you are planning to buy into a retirement village, you can put down a small deposit for them to hold your unit, until you sell. Sometimes this deposit can be as low as $2000 dollars. This will give you peace of mind that you have reserved your new home, and you just have the job of selling your home to make things work.
If you have fallen in love with a smaller ‘freehold’ home, or you are buying off the plan, you will just need the deposit on purchase, and can sign the contract based on the sale of your home. You will run the risk of losing your deposit which is usually around 10% of the total price of the home you are purchasing if you can not settle when this money is due.
Discussing your options with the financial planner and your agent is vital if you are looking to buy before selling.
Here are some major advantages when buying before selling:
1. You will know how much furniture will need to come with you, and you can sell or redistribute the rest confidently.
2. You will not have to focus on finding a new home, so you can focus on preparing your home adequately for sale.
3. You can imagine living in your new home when you feel emotional about letting go of the family home. This will help you remain positive.
Selling before buying
If you feel more comfortable selling your home before buying, so you know exactly how much you have to spend, then stick to that plan. The only risk you face is not finding a new home within the settlement period, however there are many ways around this.
Often the person buying your home can rent it back to you if you wish to stay longer and need more time to find your new property. This scenario would appeal to an investor, and is always good to discuss with your agent.
The worse case scenario is having to rent in between selling and buying or place your things in storage and bunk with a family member or friend.
Here are some major advantages when selling before buying:
1. You will know exactly how much you have to spend.
2. The sale of your home is complete so you will no longer have to worry about it.
3. You can think more clearly about your next move.
My tip would be not rush your next purchase or panic once you have sold your home. Make sure you are buying into a place you will be content and can live your best life. In most cases, the right home will appear when you are ready and have put the wheels in motion.
Julia Dyer, owner and founder of the Downsizing Connections Group, and Lifestlye Consultant is here to help you feel more confident and in control on your downsizing journey, so you can transition with ease. Her top priority is to help you overcome the overwhelm and ensure you maintain your health and wellbeing through the process. Click here to get in touch with Julia today.