Moving and trying to avoid a chain

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81881360#Comment_81881360

I appreciate that a lot of people have a desire to pay off a mortgage as a priority.

I was only pointing out to the OP an alternative viewpoint to consider, that may or may not be right for them.

discountdude_123

Thanks all. Good to hear a few people have done it. To be honest, I get anxious quite easily, so maybe owning two houses at once maybe bad, especially if it dragged on. Just for clarification, do you have to sell within 2 years, to be able to reclaim the higher stamp duty? I hadn't thought about capital gains which one poster referred to, but we bought in Nov 2021, when prices were high and we're in a low growth area, so I don't think its gone up by much (if anything).

discountdude_123

and yes, I appreciate the penion/mortage payment issue. Once we decide about the house we'll look at trying to make that more efficient (though I like the psychological aspects of paying off the mortgage - there was a great reddit thread about the pros/cons outside of the purely financial

Eilidh1970

We did this a few years ago, albeit in Scotland which has a different system. We had to pay a second home tax on the new property and had to sell the first property within a given time to claim the tax back. It definitely eased a load of stress, especially as our new house was a probate sale so therefore didn't have a chain attached to it. It was about the simplest move I've had, definitely preferable to a chain from my limited experience!

discountdude_123

Sounds like we need to talk to a mortgage advisor, and actually make a decision if we want to move!

Angelica123

Bear in mind that the reason that many other countries don't do chains is because the conveyancing is much more efficient. Often a lot is done prior to a property is put on market and often time from offer to completion is a matter of weeks (with exchange happening early in process).

It just isn't that way in the UK. Conveyancing is convoluted, people can drop out any time until exchange, and best case scenario is likely to take a few months. Even if you are not in a chain, the person you are buying from may be in a chain (unless it's a probate house).

I think it partly depends how quickly you think your current home would sell.

Bigphil1474

You have 3 years to claim back the stamp duty. But bear in mind that it's a much higher amount than you would normally pay for the house if you were just replacing your main residence. You don't normally pay CGT selling your main residence, the issue mentioned above was for the period between when you buy the second house and when you sell the first house.

Personally, whilst it sounds great not having to complete a chain and be able to move at your own speed, the costs are usually much higher overall, so it would be a no from me. I would just put your house on the market, and once it is sold (Sold subject to contract), look for a suitable house. Although about one in 3 sales collapse, that does mean around 2 in 3 don't. I'd rather have the money in my pocket than someone elses. As an alternative, you could always sell your house then move into rented and buy as a cash buyer later. Obviously some extra costs, but still probably cheaper than owning 2 houses, although maybe a bit more faff.