The dreaded property chain can cause chaos, tripping you up at the last minute. Here we take a look at the steps you can take to make things run more smoothly if you have to buy and sell at the same time.
In an ideal world, you’d sell your home the minute you put it on the market and then have all the time you need to find your next dream home while your buyers wait patiently until you’re ready to move.
Unfortunately, we don’t live in an ideal world and in most cases, you’ll find yourself in a chain. While not uncommon, property chains can cause significant headaches, so if you’re planning to buy and sell at the same time, make sure you’re prepared.
Before you start making plans to buy your new home, you need to get a clear idea of how much your current home is worth. Find a fantastic, knowledgeable local estate agent and get them round to do a home valuation.
Start by getting your head around your finances; how much can you afford to spend on your next house? How much equity do you have in your current home?
Then there is the chain to consider. When you exchange contracts on the property you want to buy, you’ll need to pay a deposit. Ideally, you should exchange on the same day as your buyer exchanges, and therefore be able to use the deposit they pay you to pay your deposit on the property you’re buying.
However, if your new house is more expensive than your current house it’s likely that the deposit required will be more than the deposit you receive, so you’ll need to find the extra cash. It’s worth checking to see if you’re financially able to do this before you start the process.
You should also bear in mind additional costs such as stamp duty. You should be able to absorb this into your mortgage borrowing – but it’s a substantial cost so it’s always good to be aware of it.
- Speak to a mortgage broker
If this is bamboozling you already, then a mortgage broker can help guide you to finding the right solution. That may involve re-mortgaging or porting your mortgage. The latter involves transferring your existing mortgage to your new property. Either way, they’ll be able to advise you on the best option for you.
- Instruct your estate agent
When you have worked out your finances and are ready to start the process of buying a new home, you will want to instruct your estate agent and get your current property on the market.
Buying a property should generally take around 6-12 weeks from having an offer accepted to completion – although things can and often do go wrong, leading to delays. When you’re buying as part of a chain, however, things can take much longer. According to Zoopla, the average sale time in a chain is six months so be realistic with your expectations for when you’ll complete.
- Maximise your negotiating power
While you’re perfectly entitled to put in an offer on a property when your own house is still up for sale, your offer will be taken more seriously if your own property is under offer. Indeed, depending on the market your offer may not be accepted at all. You’ll also be in a better position to negotiate a good price if your property is already under offer.
- Find a property and do your sums
Once you’ve found a property you like and have had a property survey, work out the sums. Consider what work, if any, you’d need to do on the property and the associated costs and consult your broker again. Perhaps the survey has flagged up issues or perhaps you want to rip out the avocado bathroom suite (remember those?) as soon as you move in. Once you’ve done the math, if you’re happy it works out, make an offer.
- Get a good conveyancing solicitor
This critical part of the buying and selling process can be long and drawn out. Your conveyancing solicitor will need to conduct numerous property searches before any contracts can be exchanged. Unfortunately, this process can take even longer if you have a solicitor who is less than proactive.
Shop around for your conveyancing solicitor, get quotes from and speak to a few and read reviews before instructing them. The process should move smoothly but if you aren’t happy with the level of communication or speed of the process, get in touch and consider asking for a new case handler if things don’t improve.
Make sure you read, sign and return any paperwork sent to you quickly and either hand deliver or use a special delivery service to ensure they’re received on time. Increasingly, conveyancers scan documents and share them on an online system you can log into. Make the most of this but don’t hesitate to speak to your solicitor on areas where you want clarification.
- Get your estate agent involved
If you don’t have the time to get involved with nudging everyone along, then here’s where your estate agent can help. They will want to get you swiftly from accepting an offer to exchange of contracts. According to the Property Ombudsman Code of Practise for estate agents, their obligations to you at this time include monitoring progress, assisting you where they can and reporting information deemed helpful to bringing the transaction to fruition. In most cases, this role will be carried out well but if you don’t hear anything from your agent, then discuss the level of their involvement with them.
Once everything is tied up, surveys and local searches are returned and any issues ironed out, you’re ready to set a completion date and contracts can be exchanged. This is the date on which the funds will be transferred and the keys will be given to the new buyer. It’s important that all parties co-ordinate a completion date that works for everyone. This will take some correspondence – via your solicitor and those of the other members of the chain – and you’ll need to be prepared to compromise.
There you have it – your date is set, and you are ready to move out of the old, and into the new. If you need any more advice on buying and selling a property or want to take the first step of getting your home valued, get in touch today and we’d be more than happy to get things moving for you or offer expert advice.