This is an age old conundrum which is asked frequently but Relocation Relocation Australia hosts, Veronica and Bryce, have the answer.
Karl and Rae fell in love with a property before they had sold their own home which left them on the back foot to negotiate for their dream house the first time round…
Consider these factors when making your decision.
1 A key question to ask: “is it a buyers market or a sellers market?” If there is an abundance of buyers then buying first could prove to be a suitable option. Alternatively, in a buyers market you could be in the situation where you have two mortgage payments to make and also by not knowing how much money you have to spend, there’s the real risk of spending more than you have.
2 Having the cash to play gives you the upper hand, Karl and Rae are the perfect example of this. After they had sold up they were cashed up and ready to negotiate.
3 You can Sell first then ask for an extended settlement to find your next home
Something else to consider is that you won’t need bridging finance if you sell first.
But if you do sell first you run the risk of having to rent for a while and being out of the property market if you can’t find what you would like to buy soon after selling.
Buying a ‘Project’ House. Be careful what you wish for.
Karl and Rae were gung hoe and unstoppable with the purchase of their “project” doer upper in Brisbane even though it was full of potential problems that would make most people run for the hills.
Unless you’re prepared and go in with a full arsenal of experience and cash it can be a money pit and exhausting experience. Here are some of the risks to look out for.
1 Asbestos is usually safe if undisturbed. Always have the experts remove it safely.
2 Have the property checked for Termites, Rot, and Damp. These can all be expensive, sometimes dangerous and on-going to repair.
3 Is it unliveable? You may need to factor in the added cost of living somewhere else while doing it up
4 Is it unsafe with faulty electrics, guttering, or plumbing? Have these issues addressed early on.
5 Ask yourself if your health and well-being are at risk. Do you have the energy to fully renovate? You will need lots of expert assistance if you’re not a natural tradie.
6 Renovations are easy to dream about but not so easy to do economically if costs and contractors aren’t managed carefully
7 Adding value to your property through a carefully managed and budgeted renovation can quickly boost your equity in the property by creating capital growth “out of thin air”
You don’t want to go overboard with expensive appliances; for instance, if the buyers don’t really care what brand they have as long as they are stainless steel.
Conversely, you don’t want to put in laminate bench tops if buyers expect stone.
Be careful not to over or under-capitalise. Take a look at renovated properties that are on the market and see the sorts of finishes the popular ones have.