26/04/2026
Selling two apartments to buy one? Plan the proper order.
Two years ago, I met with clients, husband and wife, that were about to buy a new apartment from a local developer and intended to sell two apartments to fund the purchase. I explained that a proper order was crucial to minimize their upcoming tax obligations (and avoid tax landmines).
The couple intended to sell an investment property and their primary residence – which they estimated was worth triple the value of the investment property.
The couple certainly wanted to avoid a purchase tax landmine – if they owned two apartments when they signed a purchase contract they would be subject to 8% purchase tax. They needed to sign a contract of sale for one apartment before signing a purchase contract.
The order was simple: 1) sell the investment property and pay the subsequent capital gains tax; 2) sign a contract to purchase the apartment still under construction as a sole apartment and undertake to sell their current primary residence within the statutory mandated period; and 3) sell the primary residence within the statutory mandated period to claim an exemption as a sole apartment.
The proper order was imperative to pay the minimal amount of capital gains tax, the minimal amount of purchase tax, and enjoy a full exemption on capital gains tax.
