Your Guide to Upsizing or Downsizing Your Home

Everything you need to know when you're upsizing or downsizing your home.

Outgrown your current space and looking to upsize? Or kids have found a place of their own and it’s time to downsize? If your needs have changed and you're looking for a new home, there’s a number of things to consider.

How do I know if it’s time for a new home?

Depending on where you are in your life, certain milestone events can plant the seed for a new home. These include:

  • Things are getting serious and you’re thinking about moving in with someone
  • Your family has expanded and you’ve outgrown the space
  • Your kids have moved out and the house feels empty
  • You’re looking for new or upgraded features and facilities
  • You’re looking for a different lifestyle and routine
  • Repairing or renovating your home would be more expensive
  • Repayments on your current home are getting stressful

If any of these scenarios sound familiar, you might be thinking about looking for a new home.

What are the costs involved with upsizing or downsizing?

Depending on whether you’re upsizing or downsizing, there are different costs to consider. These may include:

  • Your deposit for a new home if buying, or ongoing rental payments if renting
  • Agent fees to sell your existing home
  • Stamp duty
  • Refinancing fees
  • Registration of title and land tax
  • Legal and conveyancing fees
  • Building and pest inspections
  • Building insurance
  • Removalists

If you’re looking to buy a new home, learn more about seven upfront costs associated with buying a home here.

How will it impact my financial situations and are there any tax implications?

Selling your current home and looking for a new home can have an impact on your financial situation.

What are the impacts if I’m upsizing?

A bigger home may mean a bigger mortgage, and with this may come:

  • Increased mortgage repayments
  • A larger stamp duty payment
  • Increased cost of living expenses such as home insurance, gardening, utility bills for water, electricity, gas, etc
  • Depending on where you move, there could be increased council rates

What are the impacts if I’m downsizing?

Downsizing to a smaller home may impact your financial situation by:

  • Increasing cashflow and retirement savings
  • Reducing or eliminating your mortgage
  • Reduced cost of living expenses such as utility bills for water, electricity, gas, etc.
  • Reduced ongoing costs to maintain your home including home insurance, gardening, repairs, etc.
  • Depending on the type of home purchased, strata costs may be involved.

Do I need to sell my current home first?

Your financial situation and how quickly you want to buy your next home, may help determine whether you should sell your current home first. You may not need to sell your current property and can instead use it as an investment property. While doing your own research is important, you may what to consider talking to a financial advisor or legal professional to assess your financial situation and help you evaluate your options.

What happens if my needs change in the future?

Things change and that’s okay! If your needs change in the future, it may be time to consult this guide again.

If you’re looking to buy a home, learn more about where to start here.

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. Please consider seeking financial advice before making any decision based on this information.‍

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