Selling to buy a home: how to get organized
Selling to Buy a Home: How to Organize the Change
Selling a home to buy another is a common situation. However, it is advisable to plan ahead and be clear about three aspects:
The money available.
The possible tax implications.
The deadlines for making the change.
Calculate how much money we will have available
The first step is to know how much we will need for the new home and what our real financial capacity is, both before and after the sale.
To do this, we must take into account the purchase and sale costs, the taxes that may correspond and the possible outstanding charges, such as a mortgage.
With these figures we will be able to better assess our situation and avoid surprises or unforeseen events later.
Be tax-minded
The amount we receive from the sale is not necessarily the money we will finally have. The operation may generate a capital gain that must be taxed in the Personal Income Tax.
However, there are situations in which this gain may be exempt. One of them is the reinvestment of the amount obtained from the sale of our main residence in the purchase of another that will also be our habitual residence, provided that the established tax requirements and deadlines are met.
The gain obtained from the sale of the main residence can also be exempt when the owner is 65 years of age or older, or is in a situation of severe dependency or great dependency, provided that the corresponding legal conditions are met.
If the sale generates a capital loss, the tax treatment will be different, since there will be no gain from that operation that must be taxed in the Personal Income Tax.
For all these reasons, it is advisable to consult the tax conditions of each case before closing the operation.
Organize deadlines and move
Another important aspect is to coordinate the sale date with the availability of the new home.
If we need the money from the sale to buy, we will have to plan both operations with special attention. We must also foresee where we will be during the time that may elapse between one operation and another.
It should be remembered that, normally, when signing the deed of sale, the keys are handed over and the buyer takes possession of the property. Therefore, unless otherwise agreed, we must leave it free of our belongings at the time of delivery.
Plan before you take the plunge
Selling to buy does not have to be complicated, but it requires organization. Knowing how much money we will finally have, reviewing the tax implications and coordinating the deadlines will help us to make decisions with greater peace of mind and avoid unforeseen events during the change of home.
Contact us to arrange a visit. At Catorce Inmobiliaria we can help you value your home and plan the sale with a view to your next purchase.
