January is always a busy time in the property market. If you are looking to purchase a property, getting into the best position to make an offer is essential.
The first key point is to have an Agreement in Principle in place. Not only does this help to guide you on what properties you can afford but most estate agents will want to see this document to let you view a property or put in an offer. Here at JF Financial Solutions, we can arrange a call or appointment to discuss the figures with you and, once we have the relevant documents and information, can provide the Agreement in Principle document to you.
The second key point is your current living situation and how this will be viewed by a seller, particularly if you are selling a property and will therefore already be part of a property chain. A property chain is another term for the properties where the sale of one is linked to the sale of another and can have numerous houses within the chain. Issues or delays with the sale of one property in the chain have a knock on effect on the others. Unfortunately, it is common that buyers have done everything they need to do and are ready to move into a property but a property 2-3 transactions above in the chain is causing delays or can even cause the chain to collapse.
Not being part of a chain is obviously straightforward when you are first time buyers and it is the reason a lot of sellers would veer towards them when assessing the offers for their property. If you already own a property this is not ideal but there are a number of options available. Firstly, when making an offer it is quite common in high demand areas for people to agree to sell their house and rent or move in with parents / friends to ‘break the chain’. The second option is to keep the current property as a buy to let property, although this means keeping equity in the first property and has other tax implications (which you should get qualified advice). Thirdly, if you are fortunate enough to be able to do so, we have had clients proceed with the purchase of a new property without the need to sell their current property until after the transaction has completed. Finally, there is the option to look at bridging finance to help with the new purchase whilst the current property is being sold, this product does have a higher rate and higher upfront fees.
Unfortunately, the above options are not always available so the best you can do is get your property on the market with a sale agreed (ideally to a non-chain buyer) and have an Agreement in Principle in place. Most estate agents in higher demand areas may not even let you look at a property unless you can show your property is sold, so if you are looking to move at some point you need to take the plunge and get the for sale sign up!