Should I sell my current home before I buy a new home?
Wondering if you should sell your current home before buying your next one? Learn the pros and cons.
I’m going to sell, and then buy
Decided to sell your current house first, and then search for a new home? Some benefits may include:
Better understanding of your purchasing power
If you sell first, you’ll know how much money you have available to purchase your next home.
Funds are readily available
Once you’ve reached settlement, you’ll have money available for you to purchase your next property, allowing you to use it as equity.
Utilise your equity
If you’ve put the hard yards in and built up your equity, buying your new home first could be a great way to utilise your equity.
Some cons may include:
Rising property prices
You may end up spending more on your new home than anticipated, as property prices may rise between selling your existing home and buying a new home.
Potential rental costs
Selling first means you’ll need to find somewhere to live until you’ve found your new home. This may mean paying for rent or other temporary accommodation.
Potential moving costs
You may end up paying for moving costs twice – once to your temporary home, and again to your new home.
I’m going to buy, and then sell
If you're going to buy your new home, and then sell your existing, here are some benefits and cons to consider. Some benefits may include:
Take advantage of the property market if it’s in your favour
Buying your new home first allows you to take advantage of the property market if it's in your favour. For instance, if there a surplus of homes for sale and prices are relatively low, purchasing your new home can be advantageous. It also means you can wait to sell your existing home at the right time.
Avoid renting and multiple moves
Buying first means your likely to be able to move straight in! You’ll avoid having to find a temporary home and potentially paying rent, and moving twice.
Some cons may include:
You’ll need equity
If you're looking to buy first, you’ll need to ensure you have enough equity to cover any upfront costs associated with buying a new home.
Managing more than one loan
In addition to having enough equity, you’ll need to be prepared to manage more than one loan, which could be quite stressful.
Added pressure to sell
Managing more than one mortgage could add pressure when it comes to selling your current home. This may lead to hasty decisions being made.
If you're looking for more space, or want to upgrade features and amenities in your home, moving isn’t your only option. Learn more about renovating your home potentially being a better alternative, depending on your circumstances.
Unloan is a division of Commonwealth Bank of Australia.
Applications are subject to credit approval, satisfactory security and you must have a minimum 20% equity in the property. Minimum loan amount $10,000, maximum loan amount $10,000,000, and total borrowings per customer across all Unloan loans is $10,000,000. (For purchase loans a minimum 10% equity is required - however a Lenders Mortgage Insurance (LMI) premium and higher interest rate apply. In some cases, depending on the property’s location or type, an LMI premium may also be required for LVR between 70.01% to 80%). For loans with Lenders Mortgage Insurance (LMI) the minimum loan amount is $10,000, maximum loan amount is $3,000,000 and total borrowings per customer across all Unloan loans is limited to $3,000,000).
Unloan offers a 0.01% per annum loyalty discount on the Unloan Live-In rate or Unloan Invest rate upon settlement. On each anniversary of your loan’s settlement date (or the day prior to the anniversary of your loan’s settlement date if your loan settled on 29th February and it is a leap year) the margin discount will increase by a further 0.01% per annum up to a maximum discount of 0.30% per annum. Unloan may withdraw this discount at any time. The discount is applied for each loan you have with Unloan.
*At Unloan, we do not charge any annual, application, banking, account, transaction, late or exit fees. In certain circumstances you may be required to pay a Lenders Mortgage Insurance (LMI) premium. Learn more about why this is applied and how it works. Government fees may also apply. Learn more about government fees here. Your current lender may charge an exit fee when refinancing.
Tax law is complex and subject to change. For the latest information, check the ATO website or with your accountant or financial advisor.
Unloan is a division of Commonwealth Bank of Australia is also not a registered tax (financial) adviser under the Tax Agent Services Act 2009 and you should seek tax advice from a registered tax agent or a registered tax (financial) adviser if you intend to rely on this information to satisfy the liabilities or obligations or claim entitlements that arise, or could arise, under a taxation law.
Applications are subject to credit approval, satisfactory security and you must have a minimum 20% equity in the property. Minimum loan amount $10,000, maximum loan amount $10,000,000, and total borrowings per customer across all Unloan loans is $10,000,000. (For purchase loans a minimum 10% equity is required - however a Lenders Mortgage Insurance (LMI) premium and higher interest rate apply. In some cases, depending on the property’s location or type, an LMI premium may also be required for LVR between 70.01% to 80%). For loans with Lenders Mortgage Insurance (LMI) the minimum loan amount is $10,000, maximum loan amount is $3,000,000 and total borrowings per customer across all Unloan loans is limited to $3,000,000).
Unloan offers a 0.01% per annum loyalty discount on the Unloan Live-In rate or Unloan Invest rate upon settlement. On each anniversary of your loan’s settlement date (or the day prior to the anniversary of your loan’s settlement date if your loan settled on 29th February and it is a leap year) the margin discount will increase by a further 0.01% per annum up to a maximum discount of 0.30% per annum. Unloan may withdraw this discount at any time. The discount is applied for each loan you have with Unloan.
*At Unloan, we do not charge any annual, application, banking, account, transaction, late or exit fees. In certain circumstances you may be required to pay a Lenders Mortgage Insurance (LMI) premium. Learn more about why this is applied and how it works. Government fees may also apply. Learn more about government fees here. Your current lender may charge an exit fee when refinancing.
Applications are subject to credit approval, satisfactory security and minimum deposit requirements. Full terms and conditions are found on our Unloan Terms and Conditions. Modified Terms and Conditions will be set out in our Notice of Variation Agreement, if you are approved. This article is intended to provide general information 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.
