Selling your Large Home and Buying a Smaller One

publication date: Jun 27, 2012
author/source: Kate Faulkner, Property Expert and Author of Which? Property Books

Selling your Large Home and Buying a Smaller One

If you are buying a smaller home while selling a larger one, ideally you want the market to be rising. That way you can easily sell your home, and if you gain 10% on a £300,000 home but have to pay 10% more for a £150,000 home, you end up pocketing £30,000 versus spending an extra £15,000, so you are quids in.

Unfortunately, the current market isn't working in your favour, depending on the type of property you have and area you are living in. For our full property market report, visit the Designs on Property website.

For those looking to trade down though, it's important not to worry too much about the market. Mainly, people trade down from properties they own outright, releasing equity so you can enjoy life. Or you may be in the unfortunate situation of getting divorced, so are forced to sell and find something smaller.

Trading Down Cash Purchase

If you are trading down having owned a property for some time, then it really doesn't matter what's happening to the market. What is far more important is you find somewhere safe to live, which is easily accessible for friends and family, shops and health centres/hospitals. It is also important to find somewhere which you can either do up to your taste or is a show home in mint condition, so you can live life to the full without having maintenance worries or sit in the winter freezing with leaky windows, walls and roof spaces!

What you may have to do in the current market to sell is to drop your price so you secure a quick sale, or buy a new build and use a private part exchange company, which allows you to sell your property without using an estate agent and secures a guaranteed cash buyer so you don't have to worry about any chain problems. Not all companies who operate part exchange deals do so ethically, so if you need help finding one, contact us.

Trading Down due to Divorce/Separation

If you are trading down because you have to and there is a mortgage on the property, you may find the current market difficult to work with. Ideally you'd want a slightly rising market rather than a falling one, which can take up to 12 weeks or more to sell. During this time, there is nothing worse than having to live with a partner who you aren't getting on with and it's especially tough if there are kids involved.

If you are in this situation and can sell without being in negative equity or there is enough money for you both to sell and buy yourselves, then as long as you can secure a buyer in the current market, it's more important to move on with your lives than worry about the cash side of things. What might be worth considering though if the market is stable or falling, is to move into rented accommodation while you get used to the different financial circumstances and know what you can really afford into the future.

If however you are in the tricky situation of being forced to sell the property and you are in negative equity, it may be better if one of you can keep the mortgage and hold onto the property and the other one rent until you can sell at break even or a small profit in the future. Alternatively, it may be possible to rent out the property you own and then individually rent until the market picks up.

For more help and advice on trading down properties, whatever your circumstances, consider our unique Selling a Home and Tenant Service, giving access to Kate and her team, by phone and email, for any queries you might have.


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