Need to buy possibly without selling my flat

Indiemary

Hi MSE Forum,

I need to sell my flat to purchase ideally a house in a catchment area where i want my son to go to Secondary school. He is in Year 5, so i need to be moved by next summer.

I own my flat. It is currently on the market. Despite the estate agent advising me it would sell within 2 -3 weeks ( subject to contract). It hasnt. It went on the market nearly a month ago with just 1 viewing. It is in a desirable location.


I am now looking at my options. I plan to take early retirement by April next year. We havent found somewhere to buy yet, but if we relist our property next year in Feb/March it leaves a very short window to have bought a place by the summer.

I received some inheirtance money so with the sale of my flat which i own i should be mortgage free.


Grateful for any advice.

Regards

Mary

eddddy

Do you have enough cash to buy the house without selling your flat?

If not, I guess you'd need to borrow some money from somewhere.

You could investigate getting a bridging loan, but they are very expensive - and there are lots of risks. 

The risks include...

• One or 2 or more sales fall through for your flat, meaning you have to pay bridging loan interest for many months or more

• During the sale of your flat a major problem emerges - e.g. a problem with the lease which makes it unmortgageable, the freeholder announces extensive major works etc. Which might make the flat virtually unsaleable, until the problem is resolved.

• Property prices tumble. meaning you get much less for your flat than you expect (Maybe even meaning you can no longer afford the 'top of the market' price you would have  paid for your new house)

Maybe it would be lower risk to rent a place in the catchment area, until the flat is sold

Albermarle

You could drop the asking price for the flat, that usually fires up some interest.
The housing market is a bit flat at the moment and we are approaching Winter ( clocks go back in 2 weeks), so probably some incentive needed to get more interest.
Even if you drop the asking price by say 10%, it does not necessarily mean that you have to drop your target price by 10%. However you need to generate more viewings.

BungalowBel

I am not sure what your query is.

If you can afford to buy without selling your flat, then just do so.  You will have to pay a surcharge , because you will own more than one property, but providing the flat sells within two years (I think) , you can claim it back.

We were able to buy  our bungalow before selling our house because I received an inheritance.  It was before the surcharge came into being, so that didn't apply.  When we were ready, we put the house on the market.

Flugelhorn

check the admissions policy for the school - some look very closely at moves when the old house is within a certain distance and you still own it / have access to it - if the old one is let out and there is a tenant + tenancy then that is usually OK. But in some cases they will not accept the new address

Yorkie1

BungalowBel said:

I am not sure what your query is.

If you can afford to buy without selling your flat, then just do so.  You will have to pay a surcharge , because you will own more than one property, but providing the flat sells within two years (I think) , you can claim it back.

We were able to buy  our bungalow before selling our house because I received an inheritance.  It was before the surcharge came into being, so that didn't apply.  When we were ready, we put the house on the market.

Just to clarify it's 3 years to reclaim the second-property SDLT (assuming England).

saajan_12

Indiemary said:

Hi MSE Forum,

I need to sell my flat to purchase ideally a house in a catchment area where i want my son to go to Secondary school. He is in Year 5, so i need to be moved by next summer.

I own my flat. It is currently on the market. Despite the estate agent advising me it would sell within 2 -3 weeks ( subject to contract). It hasnt. It went on the market nearly a month ago with just 1 viewing. It is in a desirable location.


I am now looking at my options. I plan to take early retirement by April next year. We havent found somewhere to buy yet, but if we relist our property next year in Feb/March it leaves a very short window to have bought a place by the summer.

I received some inheirtance money so with the sale of my flat which i own i should be mortgage free.


Grateful for any advice.

Regards

Mary

Why do you need to wait until Feb/Mar? There may be some slowness in the market over Xmas but that's not a 5 month pause, properties do still sell. 

There are extra costs to buying before selling - namely the higher rate stamp duty, mortgage interest which you wouldn't have if you could spend the flat proceeds, etc. Could you put those towards lowering the price of the flat and just getting it sold sooner? 

EssexHebridean

You also need to factor in the risk that "something" goes wrong and for whatever reason the flat DOESN'T sell for the sum you need in the timescale for reclaiming the extra SDLT. It might not be likely to happen, but in your shoes I wouldn't be proceeding unless I was confident that I could absorb that loss if I had to.