You may be wondering how to buy a house when you haven’t sold yours. I would never recommend anyone starts looking for their new home until they’ve sold their own house first. But if you find yourself in the situation where you want to buy a house when you haven’t sold yours. Which might be because you’ve fallen in love with another house before you’ve sold yours or even listed it.
What are your options? Let’s take a closer look…
How to buy a house when you haven’t sold yours in the UK? To buy a house when you’ve not sold yours, your first option is to engage a fast acting estate agent to sell your house fast. Or you can rent your house to tenants and become a landlord. Finally, you can sell your house to a company that buys houses. This avoids being in a chain-sale or from becoming a landlord.
How to buy a house when you haven’t sold yours if you live in the UK
For those of you who can’t afford to own two homes, but can’t sell your house and still want to move, what’s the answer?
You can either let your old house to tenants to cover its costs and become a landlord. Or you sell your house to a company that buys houses and let them become the landlord instead.
If you choose to become a landlord and keep your old house yourself, you’ll be responsible for looking after your tenants and will need to continue maintaining the house when things go wrong.
However, if your choice is to go with a company that buys houses, they will take over these arrangements for you instead.
There are a few options open to you if you find yourself wanting to buy a house when you haven’t sold yours and you live in the UK. I will deal with the rules in England and Wales, as the rules are slightly different in Scotland.
Here are a few options for you:
- Your first option is to quickly engage a fast acting estate agent to sell your house as fast as possible. The problem with this solution is that it will depend on the market forces at the time. This will also mean you’ll end up in a conveyancing chain too. But also, in order to get it sold quickly you may need to price it very realistically.
- Your second option is keep your house and turn it into a rental property. This would mean becoming a landlord and letting your house out to tenants. Choosing this option will be governed by how keen or not you are to become a landlord. This is not for everyone, but it is a very good option as it will mean you’re no longer in a conveyancing chain. However, there are implications of becoming a landlord that you will need to weigh up beforehand.
- The third option is to find a company like Bowfin who buy houses to buy your house from you instead. This option is best suited to those of you who want to act quickly. If you don’t like the idea of becoming a landlord or being stuck in a conveyancing chain, this is the best option for you. Using a company that buys houses will means your house will be sold quickly.
- If for whatever reason you have to buy before you sell, you may wish to consider a bridging loan. Whilst bridging loans tend to be an expensive form of borrowing, bridge loans will enable you to move forward with the purchase of your new home. This will allow you to keep your current home on the market. The way this works is that you borrow on the strength of your existing home’s equity. This bridging loan will get repaid along with any other lending secured in your existing house from the proceeds when it’s sold.
How do you go about making an offer on a house when you haven’t sold yours?
Whether you chose to let your old house to tenants. Or if you chose to use a company that buys houses to take your house over. Both of these options make it much easier to make an offer on a new house when you haven’t sold yours.
At the point you’ve found your new dream home, you could of course engage an estate agent to sell your house quickly.
But you may find your house won’t sell quick enough. However, you may find the sellers of the house you are buying won’t agree to take their house off the market until the sale of your house is confirmed.
By retaining your old house and letting it out to tenants will mean you are no longer in a conveyancing chain.
Being a chain-free buyer puts you in a stronger position as a buyer. You may not like the idea of becoming a landlord. If so, you may be better off selling to someone like us instead.
Given the choice of a chain-free buyer vs a buyer who is a part of a chain, I’d always go for the chain-free buyer when selling a house.
Most home sellers would do the same. But also, not many sellers will be willing to accept an offer on their house from a buyer who hasn’t sold their own house first.
Can you make an offer on a house when yours isn’t sold?
In England and Wales you can make an offer on another house, even if your’s isn’t sold. However, the sellers of the new house are under no obligation to accept your offer.
They may not even accept your offer until such time as you have sold yours.
Most estate agents will probably recommend to the sellers not to accept your offer until you’ve sold. This means your proposed new home will remain on the market. Which means it could get snapped up by someone else.
I hope this article has helped about what to do when the sale of your house falls through
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