Thinking of finding a new property to move into and selling your current one? Maybe you’re moving for work, you want to upsize or downsize, or you're just looking to take advantage of an improving property market in your area.
Whatever your reasons, it's important to understand the financial aspects of selling and buying property at the same time.
As well as the sale price, there are other costs involved with buying and selling property that you need to factor into your budget. These include any repairs, agent’s fees, marketing, building and pest inspections, legal or conveyancing fees, stamp duty, removalists and refinancing your home loan.
Talking to a Home Lending Specialist can help you get a head-start in the home selling and buying processes. They can provide you with sales records, current listings and market analysis of your street, suburb and area. Then, use our home loan borrowing calculator to see how much you might be able to borrow for your next property, as well as your likely repayments and stamp duty costs.
There is no right or wrong order – it all comes down to what works best in your circumstances, such as when you find the right property and what your financial options are.
If you sell first, you’ll know how much you have to spend and may have more time to make the sale. You may have to rent until you find or settle on your new home, so don’t forget to factor these moving and accommodation costs into the equation.
If you buy first, you’ll only have to move once. It may be a while until you know for sure what the final sale amount is, but until then a bridging loan can help enable you to manage owning two properties at the same time.
Moving is not the only way to get a new home. If you love where you live, you might be better off renovating your existing property.
Work out what you need or want in a home, and whether that may be best achieved financially by renovating. Consider too whether you will refinance your current home loan, redraw, top up or take out a construction loan to fund your renovations.
To be clear about the full costs of renovating, calculate the cost of building materials and labour, architect and/or design fees, insurance, permits and possibly rental costs.
Things you should know
This article is intended to provide general information of an educational nature only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. As this information has been prepared without considering your objectives, financial situation or needs. You should, before acting on this, consider the appropriateness to your circumstances.
