If we don't have the free and the paid apps on the Apple app store yet, how would we program in the free version to link to the paid version because the link is not there yet?
Do we have to have a webpage as a placeholder to do the forward, for this first, initial case? Is this the only solution and what if we don't have a website?
If you go through the new app process in iTunes Connect, they'll give you the final App Store URL as soon as you've entered the basic metadata.
Therefore you can just create a placeholder app with a dummy name and screenshot, get the URL, and then sometime in the future when the app is ready you edit the details to the correct ones, upload the binary, and the URL will start working as soon as you publish the app.
However, I think you'd still be better off using a redirect URL anyway, so that it's under your control where the users interested in the paid version go. For example, you might want to send them to a webpage instead of straight to the App Store, especially before the paid app is published.
Forwarding to a temporary URL is your best bet. If you don't already have a URL, then I would suggest masking it with your own domain, like myapppaid.mydomain.com. You don't need a website to do it, but you would need a domain name registered, which on average is about $10 US. Just set up the subdomain and have the app point to that address, and then when the other app version is in the store, just redirect that url to the iTunes address or whatever it is you need to point to. URL shortening services may be able to do this for you if you can't get a domain, but the major ones (Bitly and TinyURL) don't allow you to change the underlying link for security purposes.
