If the homebuyer requires the equity from the sale
of their home to purchase another property, they
could sell their property and perhaps negotiate with
the new owners that they rent the property back from
them until they find a new home. This does mean
however, that they will be paying occupational rent
and may not be possible if the new homeowners are
eager to move into their new home themselves.
Another option is that the seller temporarily stays
with family members or friends or at a short-term
rental. In this instance storage facilities may become
a necessity.
There are also bridging finance options available to
sellers who would like an advance on their home’s
equity before the money from the sale has come
through. Bridging finance is a short-term finance
option based on a seller’s credit record, the amount
of equity available in their current property and the
expected cash inflow.
While having the equity readily available is an
advantage, the downside is that living in a temporary
situation could make you rush into buying another
property that doesn’t quite meet all the criteria.
There is also the chance that there are no properties
available that offer what you are looking for. The best
possible option is for the homeowner to stay in their
current home while looking for another property.
They could then make an offer to purchase their next
home subject to the sale of their current home going
through. This way they have time to do their research
and find the perfect home that fits all their criteria
before making a move.
In the case where the homeowner does not require
the equity from their current home, but can obtain
finance for an additional property without selling first,
they may find themselves in a situation of being stuck
with two properties. This could be fine as a short-term
solution but might not work for the homeowner on a
www.reimag.co.za
long-term basis. In this instance the homeowner will
need to have a contingency plan in place.
Factor two: local market conditions
While there are general property market trends
seen throughout the countr y, most areas are
affected by their own unique micro conditions. It
is never good to assume that because the general
market conditions currently favour buyers that the
ͅ