Sell and rent short term?

chris316

Me and my partner want to sell our homes and move in together. We estimate we have approx £200k combined equity and would look for a £300k property. I'm assuming even if we acted quickly we would miss the stamp duty holiday now so are wondering what is the best thing to do.

I know a couple of people that have sold and are renting as they expect house prices to drop in the next year. Is this worth considering and if so what would be the best way to invest the 200k short term? 

LAD917

Trying to time to the housing market and the stock market is usually futile, and you're trying to do both.  The advantage of selling both properties and renting for a bit is that you and your partner will be chain-free buyers with time to look together and find what you need.  If you decide to sell and rent, do it to give yourself more time with less stress, not because you think it's going to be financially beneficial.  It probably won't be.

If you intend to buy within the next 12-24 months, putting the money anywhere other than a savings account (with pitiful interest well below inflation) is going to be too risky.  Depending on your overall financial profile and age, you may decide that you'd be comfortable with a smaller deposit on the 300k purchase -- e.g., 25% (75k) or 40% (120k) -- with a larger mortgage.  In that case, you could invest the remaining equity in suitable long-term investments.  But keep any funds earmarked for your deposit liquid and in risk-free investments.

steve866

Is there any reason why you wouldn’t sell one and live in the other and sell that as part of a chain?

chris316

steve866 said:

Is there any reason why you wouldn’t sell one and live in the other and sell that as part of a chain?

No, unfortunately that's not really an option. 

K_S

@chris316 It's an option to consider for convenience and being able to buy at your own pace chain-free. Not so much for timing the housing market.

steampowered

It could make sense to rent for a year or two, while you and your partner get used to living with each other and living in the area. 

dimbo61

Are you looking at buying  together near where you live now ?
If you sell both and rent for 6/12/24 months you have time to search the whole area and maybe just maybe find the perfect home for you both.
You can also get used to living together.
If I can give you one tip regards the mortgage would be to consider an offset mortgage