I have an offer on my house but I have found nowhere to buy. What should I do?
Most people will sell their current home to fund the purchase of their next home. But what happens if you get an offer on your property before you have found somewhere to buy?
A home move can be triggered by any number of factors. Maybe you are upsizing or downsizing? Perhaps a change of jobs or a new school has prompted a move to a new area? Whatever the reason, it s unlikely that you will receive and accept an offer on your home on the same day you have an offer received on your new home.
The property market is geared up for this, so if you have received an offer but have yet to find your next home, don't panic.
You have received an offer
Great news (assuming it's an offer you want to accept). Accepting an offer does not legally oblige you to complete the sale if you are not ready to move. In fact, you can withdraw from the sale at any time - right up to the point of exchanging contracts. As the conveyancing process can take months and you are yet to find a property, the point of exchange is some way off.
Having secured an offer you don't want to lose it, however. You don't want to be in the position of having found a property to buy only to lose your buyer who has lost patience.
Communication will be key to preventing your buyer from losing confidence. With the help of your agent, you should inform your buyer that you are actively prioritising finding a property. Reassure the buyer that you have a mortgage Decision in Principle (DIP) if you can and that you will be able to move quickly once you have an offer accepted.
Thereafter, keep your buyer regularly updated
Instruct a conveyancing solicitor
If you haven't already done so, instruct a solicitor without delay. Ideally, you would instruct a solicitor soon after you put your property on the market. This enables yo to complete al of the forms and other formalities ahead of finding a buyer.
Instructing a solicitor sends a message of commitment to your buyer.
Step up your property search
With the sale of your home now progressing it’s time to get serious about finding your next property. You are in a strong position for the following reasons:
- Now you have an offer you know exactly what to budget on your next property.
- When you find a property, you offer will be more attractive than a competing offer from someone still looking for a buyer.
- Your offer may even be more attractive than a higher offer, simply because you are ready to go.
Badger the estate agents
Visit or re-visit all estate agents and ensure they understand your position, budget and requirements.
They should be keeping you informed of every suitable home that comes up for sale, but you want them to call you first. Often agents know about a new listing a few days before it appears on the property portals such as Rightmove and Zoopla.
The fact that you have a buyer for your home makes puts you in a much better position to buy. Badger (in a nice way) the agent to make sure you stay top of mind and they call you first.
Set up property alerts
You can set up property alerts with on-line property portals. You can accurately tailor your search criteria so you are alerted of properties that suit your requirements as soon as they hit the market.
Choose your mortgage lender
Now you have an offer, you should know exactly how much you need to borrow. Choose your lender and mortgage product and ask the lender if they can issue a mortgage 'Decision in Principle'. A DIP means that the lender is happy to lend to you - albeit they will still need to survey the property when you find one. Being able to tell the vendor that you have a DIP adds weight to your offer.
Your buyer is losing patience and threatening to pull out
There are two clear choices if your buyer is pushing and will not accept any further delays. Either you complete the sale and move into temporary accommodation, or pull out of the sale.
If you don’t want to risk losing the sale (particularly if your house had been on the market for some time) then you may decide to move into rented accommodation while you continue your search.
Renting can be an expensive option and there may be a minimum contract period, usually six months. If house prices are increasing, you may find the type of property you are looking for exceeds your budget after a period of renting.
Although renting may not be desirable, it is generally (financially) better than the alternative.
Pulling out of the sale means you have to find a new buyer. There is a risk that you might find your next property but be unable to move because you haven’t sold your existing home. You may once again find yourself in a chain or have to accept a lower offer.
Should I find a new property before I put my house on the market?
It is preferable to have an offer on your home when you make an offer on another property. Certainly, your property should, at the very least, be on the market when you put an offer in.
The seller will be unlikely to take your commitment seriously if your property is not on the market. The seller may well accept your offer but probably won't take their property off the market until you find a buyer,
Your next step
If you are buying, selling, remortgaging or transferring equity in a home, we can help you find an expert conveyancing solicitor.
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