It depends
You definitely need a mortgage to buy a new home whilst selling your old one concurrently.
It may prove futile to do both at the same time unless you are a bona-fide house collector. For the most part, one of the two activities has to follow the other and this heavily relies on personal factors and financial status.
Ideally, it makes more sense to buy a home, settle in then deal with the turmoil of selling the old one. Realistically, not so much.
Many Kenyans have attested to the fact that sellers do not take you seriously if you are house hunting while holding on to your current home.
It appears that selling and buying simultaneously is the only way to go. However, how viable is this in the fluctuating real estate map of Kenya?
You might need to sit down for this one
Even if you’ve planned to sell your home first and are prepared to rent while buying, know that even the best-laid plans go awry—and you might end up juggling both mortgages. Preparing yourself for this (however remote) possibility ahead of time will ensure a smooth transition.
There should be a new word already invented for selling a home and buying a home coexistently.
Somehow, the Kenyan spirit of aggressiveness continues to thrive and people are doing it, even in the worst economic times and unimaginable market conditions. It narrows down to understanding the market dynamics and coordinating your sale and purchase.
Walking on a tight rope
If you have the income and the funds to carry two mortgages, the prospects of buying and selling at the same time are looking up.
Unfortunately, not many Kenyans are so well endowed monetarily. Between the sky rocketing prices of commodities and the non-existent fight against corruption, there is no conducive business environment to allow sufficient circulation of money.
So it comes down to qualifying for a mortgage on the new house while still paying the mortgage on the old house.
Making the smart move
Go to http://www.kenyahomes.co.ke and list your current home for sale. This will definitely attract more buyers and catapult the sale of your current home.
If you are lucky enough to sell your current home quick and without de-valuing it, you can use that money to put a down payment for the new home.
How far is too far?
You have the option of borrowing from friends and family so as to put the down payment for the second home.
Promise to return the money with a competitive interest rate as soon as you’ve received money from the sale of your old home.
Disclaimer; this may only work if your financial situation is good. Institutional mortgage lenders may refuse to approve a loan where the down payment doesn’t come from your own resources.
Bridge Loan
A Bridge loan allows you to own two homes simultaneously if you don’t have deep pockets for a second down payment. This option is especially attractive if you’d planned to sell your home first and use the proceeds to buy the second. It functions as a short-term loan, intended to be repaid upon the sale of your original house.
Bridge loans can, however, be far more expensive than regular mortgage or home equity loans (higher upfront payments as well as interest rates), and they’re not easy to qualify for.
You have to have plenty of equity in your current home and enough income to pay both mortgage payments indefinitely.
For an all-in-one guide to selling your home for the best price in any market, get more tips on https://kenyahomes.co.ke/blog/sell-home-fast/