Buying new house before selling old one?

[HangTime]

Around six months ago my wife and I decided that we would move house. However, we still haven't got our house on the market as we are really struggling to get it prepped for sale, due to time constraints and looking after a toddler (who also causes mayhem / clutter / dirt etc!). Plus we still want to have a bit of a life e.g. Going for a day out at the weekend or whatever. I am making excuses here but in summation, life is getting in the way and progress is really slow.

Now, one thing that worries me is my son is due to start school in September so for school applications etc it would be better if we had moved by mid-January so that we can apply to the best schools in that location rather than relying on late entry. Plus of course the quality of life aspects like reduced commute, nicer house etc.

I have been 'window shopping' for houses (i.e. Searching online) for the past 2.5 years or so have a reasonable feel for what you get for your money in the areas we are considering. However I have deliberately not contacted any agents etc yet because I want to at least have our house on the market.

However, I am now contemplating whether it might be worth simply buying the new house before selling our current one (this would require a bigger mortgage, and perhaps borrowing some money from my dad, but should be affordable as our current property is owned outright). I'd get a fees free short term deal and then repay the bulk of the mortgage once any ERC have expired (e.g. 1.64% 2 year fix, repay after 2 years), assuming our house has sold by then of course. Effectively using the mortgage on the new house as a bridging loan. Has anyone else done this? Here is my current thinking:

Advantages:
+Puts us in a stronger buying position in terms of being chain free
+When we come to sell we will also be chain free
+More chance of moving before school application needs to be in (dependent on sellers position of course)
+Probably less stressful move i.e. Not doing it all on same day
+Easier to declutter / clean / fixup property if we are moving to a new house as it will naturally get emptied - this is a nightmare at the moment with our toddler present

Disadvantages:
-Getting absolutely shafted on stamp duty due to the new rules that came in this year (+3% surcharge for second home) - not clear to me if this can be reclaimed if you sell within x timeframe, but a hassle regardless
-Would have to keep paying bills at old property for however long it takes to sell
-Bigger mortgage = more money wasted on servicing the debt, potentially worse deals due to higher LTV
-Possibly cost more in terms of solicitor fees etc due to overheads(?)
-Risks associated with property not selling and/or collapse in local market
-Would need to periodically check in on old house to tidy up garden, check for any issues etc

 

[Buffman]

The main query would be the stamp duty surely? (if you need a quick sale just knock off the price the extra stamp duty would otherwise be??)

 

[rubberduck]

However, we still haven't got our house on the market as we are really struggling to get it prepped for sale, due to time constraints

What makes you think it will be easier to get it 'prepped for sale' when you are living in a different house which will likely also need things doing to it, cleaning etc? How much work do you need to do exactly? Anything major or do you need to just tidy up the decorating etc? How much money do you think it will devalue the house by if you don't 'prep' it? Probably not as much as you think.

If I was you I'd decide on how much you want to sell it for, put it on the market and see what offers you get. You seem to be overthinking the situation.

 

[Holst1981]

Just get on with moving IMHO.

If you need work doing and it's cost effective yet somebody in to do it.

Seems like lots of expense and hassle for little reward .

If your going to sell your place better to put it on the market.

Of you can't sell, or you find somewhere perfect.. Then it might be worth considering buying before selling, but buying takes ages even if you make an offer on the day you view and have no chain (as I did, took months before we moved in)

Very in touch with the agents to sell yours and start looking.

Good luck

 

[Siliconslave]

The cost and risk would massively outweigh the benefit i'd imagine.

If it's that much of a problem move into a holiday let for a week while you do the house up for sale and get an open day planned for the following weekend. It'll be cheaper all in all!

We rented for a few months while our last house sale went through due to relocation, but the sale was delayed by a few months - the extra hassle (and cost) was massive - double council tax, specialist (unoccupied) insurance etc etc.

 

[Psycho Sonny]

i know someone who bought without selling their old home.

in the end they had to put both on the market as the old one wouldn't sell and had to get rid of one.

ended up back in their old home as their new one had more interest.

 

[#Chri5#]

Around six months ago my wife and I decided that we would move house. However, we still haven't got our house on the market as we are really struggling to get it prepped for sale, due to time constraints and looking after a toddler (who also causes mayhem / clutter / dirt etc!). Plus we still want to have a bit of a life e.g. Going for a day out at the weekend or whatever. I am making excuses here but in summation, life is getting in the way and progress is really slow.

Now, one thing that worries me is my son is due to start school in September so for school applications etc it would be better if we had moved by mid-January so that we can apply to the best schools in that location rather than relying on late entry. Plus of course the quality of life aspects like reduced commute, nicer house etc

Would agree with others. If the new house isn't bang-on perfect (very unlikely IMHO), which house are going to spend time working on? Old or new? Or just go out for the day and do nothing?

I also think you are way too late to be looking now and have moved by mid-January. Our offer on a house was accepted 4th Nov 2015 (having accepted an offer on ours a couple of weeks prior) and we moved 19th February this year. That was a small chain of 4 houses. You'd need to be buying an empty house and push hard to get everything through in time IMHO.

By the time you've arranged initial viewings, then a second viewing, you'll be at the end of November. Remember most solicitors will shut on the 23rd December and not be back until the 3rd January, so scrub anything it that time as well.

Finally, selling an empty or near-empty house can be harder. If there's no furniture to cover up little marks on walls / carpets and things, the viewer is seeing everything so may well start trying to knock down the price.

 

[daz]

-Risks associated with property not selling and/or collapse in local market

In my mind, this is the biggest risk. By decoupling the buying and selling you're taking on a big risk that house prices could fall in the interim between buying your new house and selling the old. Obviously the market could go the other way and you'd be quids in, but that's not looking quite as likely at the moment.

Perhaps talk to a cleaning company - get them to get a team in to blitz the house and if necessary get them to come once or twice a week whilst you're on the market.

The other thing is potentially to de-clutter and that makes things a lot easier to keep tidy and it will also make the rooms look bigger as well - get rid of stuff you don't need by selling/giving away to charity or just by putting it in storage for a couple of months.

 

[psd99]

I would argue stamp duty is the biggest factor but it depends on your circumstances and whether you are buying in stoke or Chelsea!

 

[psd99]

Have you considered

selling > renting > buying

in that order?

 

[HangTime]

Seems the general consensus is to avoid this then. To address some of the comments:

The main query would be the stamp duty surely? (if you need a quick sale just knock off the price the extra stamp duty would otherwise be??)

Looking into it as long as well sell within 3 years, we can claim back the stamp duty surcharge so not a major issue.

What makes you think it will be easier to get it 'prepped for sale' when you are living in a different house which will likely also need things doing to it, cleaning etc?

Definitely be easier, as the house will implicitly be de-cluttered and also be much easier to clean / decorate without stuff/people getting in the way. The problem at the moment is, I need to spend at least a couple of hours every weekend just treading water i.e. tidying/cleaning up the mess from a lived in house, dirt/spillages etc from having a toddler around etc. It can be a bit demoralising to spend say 4-5 hours working on the house and only seeing minimum results because half the effort is just repeating what you've done before. All the advice I read/hear seems to be that you should prep your house for sale, and when I look at adverts for properties of the same type in our area they always look better inside than ours.

The new house isn't a concern because we won't be trying to sell it, so it won't matter if it is dirty or needs cosmetic work.

Finally, selling an empty or near-empty house can be harder. If there's no furniture to cover up little marks on walls / carpets and things, the viewer is seeing everything so may well start trying to knock down the price.

This was something that concerned me a bit but to counter-balance that I think it will also be a lot easier to sort things out in a house where we won't constantly be adding more marks. We can't cover up all the problems like grotty hall carpet in any case.

Perhaps talk to a cleaning company - get them to get a team in to blitz the house and if necessary get them to come once or twice a week whilst you're on the market.

This is something I am looking to do but to get value from it we need to sort out all the basics first like decluttering, fixing a blind, painting front door etc. Basically our house often isn't really in a fit state to get a cleaner in, I know that sounds a bit of a catch-22 One thing I am keen to see is whether an expert cleaner can get our hall carpet looking respectable or whether we should just rip it up and put laminate down or something.

The other thing is potentially to de-clutter and that makes things a lot easier to keep tidy and it will also make the rooms look bigger as well - get rid of stuff you don't need by selling/giving away to charity or just by putting it in storage for a couple of months.

We are working on this but we have a lot of stuff (I see comments on other photos about cluttered houses/rooms, that have maybe a third as much stuff as us!), then just silly things like putting old toys in the garage but then my son gets excited finding them and wants to play with them again - trivial really but it all adds up. Clutter is probably the biggest factor for us, most rooms probably have in excess of 500 items in them.

Have you considered

selling > renting > buying

in that order?

No because that doesn't solve our problem, the only way it could work would be if we rented first before selling but in that circumstance we'd have to move twice which wouldn't be great.

 

[Skillmister]

-Getting absolutely shafted on stamp duty due to the new rules that came in this year (+3% surcharge for second home) - not clear to me if this can be reclaimed if you sell within x timeframe, but a hassle regardless

You'll have to pay the surcharge but claim it back when you sell.

-Possibly cost more in terms of solicitor fees etc due to overheads(?)

Unlikely. Overall cost will be the same.


Personally I wouldn't bother with the extra risks.

 

[a1ex2001]

The only reason to do this is your kids school and only you can say if that's worth the hassle and expense, are the schools in your current area that bad? What are the chances of being able to change school, what's the journey like if you can't?

Your real problem is clearly that moving house isn't a priority, if it was you'd tidy your house up and get it on the market!

 

[Mark M]

Not wanting to sound like too much of an arse here but you either want to move or you dont? I know a lifes important but I used to work every night and all weekend on my last place to get it in a condition to get the best price for it. Can you not split your weekends so that you work one day while your partner spends time with your child and then you do the other day while they do some work in the house?

Surely there cant be that much to do? Paint every room white, super cheap carpets if needed, elcheapo bathroom suite that looks decent which only leaves the kitchen as the main issue surely?

 

[HangTime]

Local schools are fine, nearest primary is Outstanding but it's more a question of say we ended up moving next summer I'm assuming it would be difficult to get a place in a top school at that late notice.

I want to move but motivation is probably not at the level of some house movers, i.e. it isn't a priority that trumps everything else. We are a bit lazy and don't have much free time during the week (my commute is 4.5 - 5hrs a day), evenings are usually a case of having a meal and maybe an hour to wind down. I could maybe do an hour of work on the house in the evenings but as I say we aren't as diligent as some, plus have to wary of some tasks as son is asleep.

I forgot to mention we were both completing postgraduate study until mid-September which also took up a lot of free time til that point but my worries have come in because in the ~8 weeks since then we've not made the progress I had hoped.

Weekend split thing is pretty much how it goes but not all weekend every weekend, kind of in that halfway house situation whereby we still want to enjoy life in parallel with getting things sorted out. Not the best way to get the house sold but not sure we'd want to make that the sole focus. I get de-motivated at times when I spend many hours on things and then it regresses, it feels like swimming against the tide but without that Olympian drive to cross the channel and climb out the other side. It doesn't feel like it should be that hard really but seems massively harder with a child and less free time compared to when we sold our previous house.

Pretty much ruled out this option now, as someone mentioned it is probably too late to move by mid-Jan anyway. Was just something I was running through

 

[wesimmo]

How old are your kids?

Why not be realistic with your timescales for doing the current house and aim to move in time for the following school year?

If your kids are young I think they're quite flexible and make friends more easily so moving schools shouldn't be such an issue.

You might find more time to do bits round the house once you've had a rest after what sounds like an intense few years!

 

[Haggisman]

How much money do you think it will devalue the house by if you don't 'prep' it? Probably not as much as you think.

Not to mention there's no point spending a lot on tidying it up, as most buyers will want to redo a lot of the decorating themselves!

 

[a1ex2001]

Local schools are fine, nearest primary is Outstanding but it's more a question of say we ended up moving next summer I'm assuming it would be difficult to get a place in a top school at that late notice.

I want to move but motivation is probably not at the level of some house movers, i.e. it isn't a priority that trumps everything else. We are a bit lazy and don't have much free time during the week (my commute is 4.5 - 5hrs a day), evenings are usually a case of having a meal and maybe an hour to wind down. I could maybe do an hour of work on the house in the evenings but as I say we aren't as diligent as some, plus have to wary of some tasks as son is asleep.

I forgot to mention we were both completing postgraduate study until mid-September which also took up a lot of free time til that point but my worries have come in because in the ~8 weeks since then we've not made the progress I had hoped.

Weekend split thing is pretty much how it goes but not all weekend every weekend, kind of in that halfway house situation whereby we still want to enjoy life in parallel with getting things sorted out. Not the best way to get the house sold but not sure we'd want to make that the sole focus. I get de-motivated at times when I spend many hours on things and then it regresses, it feels like swimming against the tide but without that Olympian drive to cross the channel and climb out the other side. It doesn't feel like it should be that hard really but seems massively harder with a child and less free time compared to when we sold our previous house.

Pretty much ruled out this option now, as someone mentioned it is probably too late to move by mid-Jan anyway. Was just something I was running through

Could you get the grand parents round for a weekend, I know you'll miss out on time with your son but both he and his grand parents will benefit from the time together and that will leave you and the wife free to focus on sorting out the house.

Break it down into less daunting steps ie start small declutter your mantle piece, then a side table then a cupboard etc. be ruthless in getting rid of stuff almost everyone hangs onto far to much stuff just in case!

 

[Slam62]

Yeah sounds a great plan, what could possibly go wrong as long as house prices keep rising and you can afford the extra payments.

You can afford the extra payments can't you?

 

[HangTime]

How old are your kids?

Why not be realistic with your timescales for doing the current house and aim to move in time for the following school year?

If your kids are young I think they're quite flexible and make friends more easily so moving schools shouldn't be such an issue.

You might find more time to do bits round the house once you've had a rest after what sounds like an intense few years!

My son is 3, he's a summer baby so will be starting school quite young. Problem with waiting another year is that would mean another year plus of commuting. My wife took a new job in the sort of area we want to move to so we are both commuting at the moment. In hindsight might have been better for her to have taken a local job until we moved.

Could you get the grand parents round for a weekend, I know you'll miss out on time with your son but both he and his grand parents will benefit from the time together and that will leave you and the wife free to focus on sorting out the house.

Break it down into less daunting steps ie start small declutter your mantle piece, then a side table then a cupboard etc. be ruthless in getting rid of stuff almost everyone hangs onto far to much stuff just in case!

Trying to do that a bit but it isn't quite as straightforward as it could be, this will sound like more excuses being thrown up but we are limited a bit because half of them are dead, they live in a different county, one has mental illness and can't drive so needs to be collected (I can't drive either so has to be my wife collecting) etc.

We have made some progress but I tend to get bogged down going through paperwork etc (shredding / keeping - spent about 5hrs on that last time I did it). Probably we should prioritise more i.e. just chuck stuff in the garage as a job lot if it doesn't NEED to be done before we move.

Yeah sounds a great plan, what could possibly go wrong as long as house prices keep rising and you can afford the extra payments.

You can afford the extra payments can't you?

Extra payments not a problem. If house prices fall then not ideal as we have two depreciating assets but if house prices are going to fall then we'd lose money regardless by moving to a more expensive house.