Buying and Selling at the Same Time? How Does It Actually Work?

For many homeowners, moving to the next property involves two transactions happening at once selling your current property and buying your next home.

Whether you're upsizing, downsizing, relocating or looking for a fresh start, buying and selling property at the same time can feel overwhelming. There are two contracts, settlement dates, finance arrangements, moving plans and important deadlines to coordinate.

With the right preparation, however, the process can be much easier to manage. Here's a simple guide for property owners buying and selling in NSW and Queensland.

Should You Sell First or Buy First?

There isn't one answer that suits everyone. Selling first can give you a clearer idea of how much money you have available for your next purchase, but you may need temporary accommodation if you don't find another property before settlement.

Buying first can give you certainty about where you're moving, but you may need to manage two properties temporarily or arrange more complicated finance. Your circumstances, finances and the local property market will influence which approach may work best.

Work Out Your Finances Early

Finance is particularly important when you are selling one property to buy another. Before making an offer, understand:

·         How much you currently owe on your mortgage

·         Your estimated sale proceeds

·         How much you may be able to borrow

·         The deposit required for your purchase

·         Transfer duty or stamp duty

·         Conveyancing and inspection costs

·         Moving expenses

·         Whether you could manage a period of owning two properties

Speak with your lender or mortgage broker early so you understand your financial position before committing to another property.

Can Your Sale and Purchase Settle on the Same Day?

Sometimes sellers aim to have the sale of their current property and purchase of their new property settle on the same day. This can be convenient where funds from the sale are needed to complete the purchase.

However, coordinating settlements requires careful planning. If one transaction is delayed, it may affect the other. Make sure your conveyancer knows from the beginning that you are both selling and buying.

Keep Track of Both Contracts

Buying and selling simultaneously means dealing with two separate property contracts. Important dates may include:

·         Deposit deadlines

·         Finance dates

·         Building and pest inspection dates

·         Cooling-off periods where applicable

·         Settlement dates

·         Final inspection

Your conveyancer can help you understand each contract and identify where the timing of one transaction could affect the other.

What If You Sell Before You Find Your Next Home?

Sometimes your property sells faster than expected. You may need to consider temporary accommodation, staying with family, short-term rental accommodation, storage or negotiating an appropriate settlement timeframe. Having a backup plan before listing can reduce stress.

What If You Find Your New Home First?

If you find the right property before your existing home sells, understand your financial position before committing. Depending on the circumstances and what the seller will agree to, there may be contractual options to discuss with your conveyancer. Don't assume your purchase can automatically depend on the sale of your current home.

NSW and Queensland Transactions Are Different

This is particularly important if you're relocating between Northern NSW and Southern Queensland. The contracts, procedures and legal requirements are not identical. Don't assume a Queensland purchase will work exactly like a previous NSW transaction, or vice versa.

Plan Your Move Around Settlement

Think about removalists, utilities, cleaning, storage, keys, pets and where you will stay if the two transactions don't line up perfectly. Try to leave some flexibility in your moving arrangements.

Buying and Selling at the Same Time? Talk to SL Conveyancing

Early preparation can make coordinating a sale and purchase much easier. Speak with your lender, real estate agent and conveyancer before making major commitments.

If you're planning to sell your current home and buy another property in NSW or Queensland, contact SL Conveyancing. We can help you understand both contracts, important dates and the settlement process from start to finish.