Buying a new home before selling your current one is a bold move, but for many homeowners, it’s the ideal scenario. Instead of rushing to find a place after selling or dealing with temporary accommodation, you get the chance to secure your next home first and transition seamlessly. However, the biggest challenge is bridging the financial gap between purchasing your new property and finalising the sale of your current one.
With the right planning and financial tools, buying before selling can offer flexibility, remove stress, and even help you achieve a better sale price for your existing home. Here’s what you need to know to make it work.
Why buy first?
Many buyers choose to secure their next property before selling their current home for a few key reasons. It eliminates the pressure of needing to find a home quickly after selling, ensuring you don’t settle for something that isn’t quite right. It also allows you to move directly into your new home without the need for short-term rentals or temporary living arrangements.
Selling on your own terms is another major advantage. Without a settlement deadline looming, you can take the time to market your home effectively, attract the right buyers, and negotiate the best possible price rather than feeling forced to accept a quick offer.
The main challenge, however, is managing the financial aspect of buying before selling. This is where having access to funding solutions can make all the difference.
How to bridge the financial gap
If you don’t have the cash reserves to cover the deposit or upfront costs of your new home while waiting for your current property to sell, there are a few ways to make it work.
Accessing your home equity
One of the most practical options is tapping into the equity in your current home. Equity is the difference between the market value of your property and what you still owe on your mortgage. This built-up value can be used to secure funding for a new home purchase.
Equity Flow is designed specifically for homeowners in this situation, providing access to funds ahead of settlement. This means you can secure your next home without needing to sell first, cover the deposit, and manage the transition without financial strain.
Bridging finance vs. Equity Flow
Bridging finance is a common option, but it often comes with high interest rates, strict conditions, and rigid repayment schedules. Many buyers find it challenging to manage, particularly if their existing home takes longer to sell than expected.
Equity Flow provides a more flexible alternative, giving homeowners access to up to $250,000 before settlement. This funding can be used for deposits, transaction costs, or minor improvements that enhance the sale price of the existing home. The repayment terms align with the sale of the current property, avoiding the pressure of servicing two large loans at once.
Negotiating a conditional offer
If the seller is open to it, you may be able to make an offer that is conditional on selling your current property. While not all vendors will agree to this, it’s worth discussing with your real estate agent, particularly if the market is softer and sellers are open to flexible terms.
Renting out your current home
For those who want to buy first but aren’t ready to sell, renting out the existing property for a short period could be an option. This provides a temporary income stream to cover mortgage payments while waiting for the right market conditions to sell.
What to consider when buying before selling
Many buyers focus on the deposit and purchase price but overlook the additional costs involved in buying before selling. Holding two mortgages, even for a short period, requires careful planning.
Beyond the home purchase itself, there are plenty of other costs to factor in; marketing fees to ensure your existing home gets maximum exposure, temporary storage if you need to declutter for open homes, and even moving expenses to make the transition as smooth as possible.
This is where Equity Flow can help. Instead of scrambling to cover these costs upfront, you can unlock up to $250,000 of your home equity before settlement to cover anything from professional styling and marketing to bridging rent, storage, and relocation expenses.
With a quick online application and fast approvals, you can access the funds you need without disrupting your home-buying journey. It’s all about making your move seamless, so you can focus on securing your next home without unnecessary stress.
Is buying before selling the right move for you?
Buying before selling isn’t for everyone, but for those who want to secure their ideal home and avoid the uncertainty of rushed house-hunting, it can be a great option. The key is ensuring you have the financial flexibility to manage the transition smoothly.
By exploring options like Equity Flow, homeowners can confidently purchase their next property, secure their future home, and sell their existing one without unnecessary pressure. If you’re considering making your next move, planning ahead and having the right financial tools in place can make all the difference.