How to Upgrade from a Smaller to a Larger Home When Buying

Sign two contracts simultaneously—one for selling your property and one for buying the new one—then schedule the down payment in the purchase contract to come after the closing date of the sale.
To avoid keeping the next buyer waiting too long, you can pay the price difference upfront. This amount can be treated as either a down payment or earnest money. But this approach has a drawback: the buyer can’t easily use the “trade-up” strategy unless their own buyer agrees to the same arrangement, which could drag out the entire transaction indefinitely.
The longer the deal takes, the higher the risk of something going wrong. Remember this basic principle: always make the party above you bear heavier penalty liabilities than the one below.
Even so, accidents happen. I had a client who wanted to sell their commercial-residential unit to upgrade to a larger home. Because of purchase restrictions, the buyer lost their eligibility to buy, so the sale fell through. My client breached the contract with their buyer and ended up paying 200,000 yuan in damages.
So frankly, there’s no perfect solution to the “trade up amid rising prices” problem—someone always ends up holding the bag.