You don’t have to sell before you buy a new house, but it helps

You do not necessarily first have to sell your current house before you put in an offer to purchase a new house, but it may help if there is a lot of interest in the new property according to the Seeff Property Group.

Tiaan Pretorius, manager for Seeff Centurion says if you still have to sell your home when you made an offer on another property, you can run the risk that your property does not sell in time. You could, therefore, lose out on buying the property you wanted.

On the other hand, if you first sell before you buy a new property, you could risk not finding something suitable in time. This is one of the reasons why you would often find an offer to purchase a property on condition of the sale of another.

This type of offer would contain a clause which states that the offer is contingent upon the sale of another property within a particular time period. The challenge for the buyer might be whether their property is in an immediately sellable condition and what price they want for it.

Gerhard van der Linde, managing director for Seeff Pretoria East, says that they do not discourage offers that are subject to the sale of another property. Many transactions are, in fact, concluded in this way.

There is usually not too much risk for the seller as the offer to purchase would also include a clause enabling the seller to continue marketing the property. Should another buyer then put forward an unconditional offer, the first buyer will be notified and will have an agreed-upon period in which to make their transaction unconditional.

If the buyer really has their heart set on the new home and their property is still not sold, they could, if they are financially able, take the risk by removing the conditional sale of their property from the offer.

Van der Linde says this “clean” offer would then not be subject to the sale of another property. Unfortunately, buyers often make an offer based on what they expect for their own property which has not been sold as yet. The risk is that the property does not sell.

On the other hand, your property could sell before you have found another suitable property. So, do you prefer possibly having two homes, or no home? Van der Linde says it is best that the buyer first consults a local estate agent who can advise on what their property could potentially sell for.

With this information in hand, they could then decide how they want to proceed. Pretorius says that if it is a good offer with no other suspensive conditions, it makes good sense for the seller to accept the offer since they can continue marketing their property as noted above.

It is common for transactions to be linked, where additional parties, such as the buyer’s buyer, are introduced. All of the transactions will then be linked. These transactions take place daily and are often quite successful.

Writer: Gina Meintjes