Buy first or sell first? The pros and cons

Ready for a new home, but already own your current one? Then you face a classic question: do you buy a new home first, or sell your current one first? Both choices have pros and cons. The right order depends on your financial room, the market and your personal situation.

Buying first: the advantages

Those who buy first know for certain where they're going. You can search calmly and act quickly when the right home comes along. In a tight market, where good homes sell fast, that's a big advantage. You also won't need to live somewhere else temporarily.

Buying first: the risks

The biggest risk is double housing costs. If your current home isn't sold quickly, you'll pay two mortgages for a while. You also don't yet know exactly what your current home will fetch. If the proceeds turn out lower than expected, that can put pressure on your financing. A bridging loan can help, but also carries interest costs.

Selling first: the advantages

If you sell first, you know exactly how much equity you have. So you buy with a clear budget and run no risk of double costs. Moreover, when bidding you can show that your financing doesn't depend on a sale. That often makes your offer more attractive to a seller.

Selling first: the risks

The downside is that you may not yet have a new home at the time of transfer. Then you'll have to rent temporarily, live with family, or agree a generous completion date with the buyer. The latter is negotiable in many cases. A good selling agent also negotiates on timing, not just on price.

A middle way: switching simultaneously

In practice many people look for a middle way. They put their home up for sale and actively search for a new home at the same time. By agreeing a flexible completion date, both transactions can align well. This does require good coordination and an agent who oversees both sides of the process.

Have your situation calculated

Before making a choice, it's wise to know what your home is worth and what you can borrow. Request a free valuation and have an adviser calculate via mortgage advice whether you can temporarily bear double costs. For a purchase, an official valuation is usually needed for the financing.

What suits the market?

In a market with many buyers and little supply, a home is usually sold quickly. Then buying first is less risky. In a quieter market, selling takes longer and selling first is often safer. Read more about the local situation in our article on the housing market in the big cities.

Buying and selling under one roof

At Evim Makelaars you can turn to us for both selling and buying. That makes it easier to align both processes with each other. Get in touch for a no-obligation conversation about your moving plans.

A real-world example

Say you live in an apartment and want to move to a house with a garden. You find a home that fits perfectly, but your apartment isn't yet for sale. If you choose to buy first, you can agree a late completion date with the seller. In the meantime you put your apartment up for sale. That gives you time to sell and limits the period of double costs.

The bridging loan

A bridging loan is a temporary loan that lets you use the equity of your current home in advance. That way you can buy the new home before the old one is sold. The conditions differ per lender. The term is often limited and you pay interest on the loan. It's a handy tool, but requires a realistic estimate of the sale price and the time it will take to sell your current home.