There are many reasons why people sell their properties. One of the less common reason is to fund another property purchase. The current property might be in a location that the owner no longer desires. A property owner could have purchased a property several years prior as a residential property because the area was quiet and serene.
Many years after, the area might have developed into a commercial area, noisy and rough. There are also instances when the property owner previously built a large property when the children were young. As the cost of maintenance increases and the children become adults the couple may decide to downsize and move into a smaller property.
The fact is that a person might decide for several reasons to sell one property and use all or part of the proceeds to buy another property. There have been situations where a widow or widower living in a large house has decided to sell and move into an apartment in order to have the opportunity of interacting with others.
Maintaining a property might become impractical or unpragmatic. It might make more economic or practical sense to sell a property and then move into another one which could be bigger or smaller than the previous property. Whatever the reason for this decision, it is always better to approach the issue pragmatically and systematically.
One of the first steps is to decide what you want and then walk backwards to get it. If your current property is sold, what type of property would you like to purchase and why? It is important to know what you want and the cost of getting it. You should have a fair idea of the area that you would like to move to and research the average sale price of properties in that location.
If the properties in the area that you are targeting are more expensive than the area that you plan to sell you might need to reconsider your strategy. If the property price is significantly cheaper you might still have some money to keep or save or invest after purchasing your targeted location.
The above consideration is what will lead you to decide on the cost of sale of your property and how quickly you want the property sold. The less time you have to negotiate and conclude the sale the more disadvantage it gives you. Therefore this type of decision should not be left to when you will be under pressure to make it. You should also avoid putting yourself under pressure to sell by agreeing with a seller and guaranteeing payment when you are yet to have a buyer for your property.
It is also wise to avoid a situation whereby you would have sold your property, but you are forced to move into a rented property or given a short time frame in which to give the new owner vacant possession while you have no property to purchase. The illusion of having a large amount of money in your account could result in several unnecessary purchases which will deplete your resources and could hinder or delay your opportunity to buy a more strategically located property.
One of the critical issues that you should address is your finances. You need to prepare for some likely scenarios that could occur in situations like this. What will you do if you see a property that you would like to buy but your property is not yet sold and is not attracting enough interests?
If you have some savings that you could use to make a deposit that would be a step in the right direction. If this is not the case, you may need to start looking for a bridging loan that you could use as leverage to purchase the property. The seller of the property is not oblige to wait until when you have sold your property except you negotiate that during the process and he or she is willing to accept an amount as deposit.
It is important to involve your Estate Agent and Solicitor early in the process. In order for these professionals to be able to assist you, they must know what you want and how much you are prepared to spend. Your property search and marketing of your own property for sale need to go on simultaneously. Depending on the state of the market, they might be able to bring the two negotiations to a close at almost the same time and where it is unrealistic to expect a prompt sale they will advise you appropriately. However, if well managed, you can sell your property and buy another one at the same time.
The post How to buy and sell a property at once appeared first on TheNigerialawyer.