In Sydney’s ever-competitive real estate landscape, particularly in the Inner West where demand for quality homes is fierce, homeowners often face a common question: should you sell your current property before buying a new one or buy first and then sell? At RE Collective, we understand the intricacies involved and are here to guide you through this important decision.
Selling First: The Pros and Cons
Pros
- Financial Certainty: Selling your property first gives you a clear understanding of your budget for your next home, minimizing financial risk.
- Avoid Bridging Loans: You won’t need costly bridging finance, as you’re not juggling two properties simultaneously.
- Stronger Negotiating Power: With the proceeds from your sale, you’ll have better leverage when negotiating your next purchase.
Cons
- Temporary Housing: You might need to rent or stay with family, which can add costs and create logistical challenges.
- Market Uncertainty: If property prices rise quickly, you could end up paying more for your new home than anticipated.
- Limited Time to Buy: The urgency to find a new property could pressure you into making a hasty decision.
Buying First: The Pros and Cons
Pros
- Securing the Ideal Home: You have the flexibility to search for the perfect home without rushing.
- Market Advantage: In a rising market, buying first means you lock in a purchase price before prices climb further.
- Seamless Transition: Moving straight from one property to another avoids the hassle of temporary accommodation and multiple moves.
Cons
- Financial Strain: Managing two mortgages or securing bridging finance can be a heavy financial burden.
- Pressure to Sell Quickly: You may feel the need to sell your current home fast, potentially accepting a lower offer.
- Risk of Market Shift: If the market slows, your current property may take longer to sell, increasing financial pressure.
How Long Does It Take to Sell a Property?
The selling process includes several stages, each with its own timeline:
- Preparation: Decluttering, staging, and necessary repairs can take a few weeks.
- Listing and Marketing: Professional photography and marketing usually require one to two weeks.
- Open Inspections: Typically held over two to four weekends.
- Negotiation and Sale: Negotiations often take a few days to a week.
- Settlement: In NSW, settlement is usually around 42 days from contract exchange.
How Long Does It Take to Buy a Property?
Buying also involves key steps:
- Research and Inspections: Depending on your criteria and market conditions, this can take several weeks or even months.
- Financing: Pre-approval for a mortgage can take a few days to a couple of weeks.
- Offer and Negotiation: This can be completed in a few days.
- Contract Exchange: Usually takes a couple of weeks after an offer is accepted.
- Settlement: Typically 42 days in NSW, similar to the selling process.
Making the Right Decision
Whether to sell first or buy first is a personal decision based on your financial situation, the current market, and your preferences. Selling first gives you financial clarity, but may come with temporary accommodation challenges. Buying first secures your next home but requires careful financial management.
At RE Collective, we recommend thoroughly assessing your finances and market conditions. Consulting with real estate and financial experts will ensure your strategy aligns with your goals. Whether you choose to sell or buy first, having a clear plan in place will help make your transition seamless and stress-free.
