Selling and Buying Residential Property on the Same Day: Why This Is Not Recommended

Selling and Buying Residential Property on the Same Day: Why This Is Not Recommended

Many people involved in selling their home and purchasing a new property understandably assume that all of this can be achieved in one day. In a perfect world, this would be ideal, not to mention cost-effective, time-saving, and less stressful. Or is it?

In the “old” days, conveyancing was undoubtedly considerably simpler. There were fewer criteria to fulfill, both regarding mortgages and the drawdown of loan funds, and the legal process in general. Unfortunately, in the current climate, with mortgage conditions more difficult to meet and a greater tightening of the reins by both banks and the Law Society, what used to be a matter of course is now extremely difficult to achieve.

Attempting to close a sale and a purchase on the same day puts a great deal of stress on the links of what is likely to be an already very tight chain. One slip by one of many parties, and the whole structure can come apart.

Delays can occur in many aspects of the transaction.  The purchaser buying your property may have last minute issues with drawing down their own loan funds. If this is delayed by even one day then the whole deal collapses; they cannot move into your property and as a result, you cannot move into your new home.  Quite possibly, the vendor selling the property to you then cannot move on themselves and so the chain disintegrates.  Indeed if you too are relying on the timely drawdown of loan funds for your onward purchase then this also adds to the stress and possibility of collapse.

Ideally, therefore, if you can come to terms with the idea of selling your property in advance of signing a contract on your new home, you are in a considerably better position for a number of reasons:

• you are considered a “cash” purchaser which is of greater appeal to a vendor who may give precedence to your offer rather than another purchaser who has to rely on drawing down a mortgage;
• you are under less pressure to place an offer on a home that you may not have fully considered – juggling offers on your current home with placing offers on your new home may lead to you to making decisions you may regret in the future;
• selling and buying your home can be highly emotionally charged. Having a break between the two gives you time to recharge your  batteries and refocus.

Of course, given the current rental market, you will not always have the luxury of being able to do the above.  However, you should be prepared to seek alternative accommodation from a couple of days to up to a number of weeks to allow for any pitfalls which may occur between the sale of your old house and the purchase of your new one.  You should also budget for storage of your property during this period.