The order should follow whichever side is harder, which at the top of the market is usually buying. If you can carry both comfortably, buy first because scarcity is the binding constraint. If you cannot, sell first and negotiate a rent-back rather than risking financial strain.
Sell first and you may be renting in a market where what you want is scarce. Buy first and you may carry two properties. There is no universally right order, but there is a way of deciding.
Almost every owner of a substantial property faces this at some point, usually with a deadline attached and rarely with a clean answer. Sell first and you may be homeless, or renting, in a market where the property you want is scarce. Buy first and you may be carrying two properties, one of which is not selling.
There is no universally correct order. There is a way of deciding.
The order should follow whichever side of the transaction is harder, and at the top of the market that is almost always the buying side.
If what you want is genuinely scarce — a specific street, a dock, a view corridor, a market with three or four suitable properties a year — then buying first is the logical order, because you cannot manufacture the opportunity but you can manage the sale.
If what you are selling is the harder half — an unusual property, a thin market, a season that has passed — then selling first protects you from carrying something you cannot move.
Answer that question honestly before considering anything else.
The advantage. You buy when the right property appears rather than when your sale forces you. You negotiate without a deadline, which is worth real money. And you move once.
The exposure. Two sets of carrying costs, potentially for longer than you expect. Pressure to accept a weaker offer on the property you are selling, which frequently costs more than the convenience was worth.
What makes it work. Genuine capacity to carry both without strain, and a realistic view of how long your sale will take. Doubling your own estimate is a reasonable discipline.
The advantage. You know your number, you buy as a cash-equivalent buyer, and you negotiate from strength.
The exposure. You may not find the right property. In a scarce market that can mean a year in rented accommodation, moving twice, and storage.
What makes it work. A rent-back negotiated into the sale, buying you months in the property while you search. Sellers frequently grant this readily; buyers of large properties often have no urgency to occupy.
Several structures exist and they are not equivalent.
A bridge loan is short-term financing secured on both properties. Fast and expensive, and it assumes the sale completes on schedule.
A securities-backed line lets you buy against a portfolio without touching either property. Often cheaper and faster, with the collateral risk discussed elsewhere.
A rent-back is the simplest and most underused tool available. It costs almost nothing and solves most of the timing problem.
Delayed financing lets you purchase with cash and place a mortgage shortly afterward, which combines a strong offer with eventual leverage.
Arrange whichever applies before you need it. These are not instruments you assemble in a fortnight.
An offer contingent on selling your existing home is the weakest common offer in the market, and at high price points it is frequently declined outright.
Where you must use one, strengthen it: have your property already listed and ideally already in contract, offer a larger deposit, and keep the contingency period short. A contingent offer on a property you have not yet listed is unlikely to be taken seriously.
Most people at this level who can carry both should buy first, because scarcity is the binding constraint and a rushed purchase costs more than a few months of double carrying.
Most people who cannot carry both should sell first with a rent-back, and accept the possibility of an interim rental rather than the certainty of financial strain.
The version that goes badly is buying first while assuming a quick sale, and then discovering the market disagrees.
Follow the harder side. If what you want is genuinely scarce, buy first, because you cannot manufacture the opportunity but you can manage a sale. If what you are selling is the difficult half, sell first.
An arrangement letting you remain in the property after closing for an agreed period. It is the simplest and most underused tool for bridging the gap, and buyers of large properties frequently have no urgency to occupy.
A bridge loan is fast and expensive and assumes your sale completes on schedule. A securities-backed line is often cheaper and faster but carries collateral risk. Arrange either before you need it rather than in a fortnight.
Rarely at high price points. If you must use one, have your property already listed and ideally in contract, offer a larger deposit and keep the period short. A contingent offer on an unlisted property is unlikely to be considered.
Buying first while assuming a quick sale. Doubling your own estimate of how long your sale will take is a reasonable discipline before committing.
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