Tips for upsizing your home

Upsizing your home is an exciting venture, whether you’re expanding for a growing family, seeking more space, or looking for a change in lifestyle. However, the process can be daunting, especially when it comes to managing the financial aspects of buying a larger property while selling your current one. In this blog, we’ll provide essential tips for upsizing your home, focusing on short-term property finance solutions that can facilitate a smooth transition for upsizers, and indeed all smart property buyers and sellers.

The challenges of upsizing your home

Upsizing presents unique challenges, particularly in coordinating the sale of your current home with the purchase of a new, larger property. Key challenges include:

• Timing: Synchronising the sale of your current home with the purchase of your new home.
• Financial strain: Managing the costs associated with buying a larger property, including deposits, moving expenses, and potential renovations.
• Market conditions: Navigating the real estate market to secure a desirable property at a reasonable price.

Introducing short-term property finance

Short-term property finance solutions, such as bridging loans, can help address these challenges by providing immediate funds to purchase your new home before selling your existing property. This flexibility ensures you don’t miss out on your dream home due to timing issues or financial constraints.

What is short-term property finance?

Short-term property finance includes various financial products designed to cover temporary funding needs. These products typically have a shorter repayment period than traditional mortgages and can be an effective tool for upsizers.

Key features of short-term property finance

• Immediate access to funds: Quick approval and disbursement to facilitate timely property purchases.
• Short-term duration: Loans typically range from 6 to 12 months.
• Flexible use: Applicable for residential, commercial, or investment properties.

Tips for upsizing your home

With a solid understanding of short-term property finance, let’s explore practical tips to ensure a successful upsizing experience:

1. Assess your needs and goals

Before beginning the upsizing process, take the time to assess your needs and goals. Consider the following:

• Space requirements: Determine how much additional space you need and what specific features are important (e.g., extra bedrooms, larger kitchen, outdoor space).
• Lifestyle changes: Think about how a larger home will fit into your current and future lifestyle.
• Budget: Establish a clear budget for your new home, including potential renovation costs and ongoing expenses.

2. Research the market

Understanding the real estate market is crucial for making informed decisions. Consider the following:

• Property values: Research property values in your desired area to set realistic expectations for your new home.
• Market trends: Stay informed about market trends, such as supply and demand, which can impact property prices and availability.
• Neighbourhood amenities: Evaluate the amenities and services available in potential neighbourhoods, such as schools, parks, and public transportation.

3. Explore short-term property finance options

Short-term property finance solutions can provide the necessary funds to facilitate your upsizing journey. Consider the following options:

Bridging loans

Bridging loans are a popular short-term finance option for upsizers. These loans provide immediate funds to purchase your new home before selling your current one.

Benefits of bridging loans:

• Quick access to funds: Ideal for urgent property purchases.
• Flexibility: Can be used for residential, commercial, or investment properties.
• Short-term solution: Typically repaid within 6 to 12 months, reducing long-term financial commitment.

Personal loans

Personal loans can provide additional funds for renovation or moving expenses. These loans are usually unsecured and can be obtained quickly.

Benefits of personal loans:

• Fast approval: Quick processing and disbursement of funds.
• Flexible terms: Repayment terms can be tailored to suit your needs.
• No collateral: Often unsecured, requiring no collateral.

Home equity loans

Home equity loans allow you to borrow against the equity built up in your current home. This can provide additional funds for your new home purchase or renovations.

Benefits of home equity loans:

• Lower interest rates: Often lower than other types of loans due to the secured nature of the loan.
• Tax benefits: Interest payments may be tax-deductible.
• Lump-sum payment: Provides a substantial amount of money upfront.

4. Plan for the transition

Careful planning is essential to ensure a smooth transition between homes. Consider the following tips:

• Timeline: Develop a clear timeline for selling your current home and purchasing your new one. Include key milestones such as listing your home, closing dates, and moving.
• Temporary housing: Plan for temporary housing arrangements if there is a gap between selling your current home and moving into your new one.
• Professional help: Engage real estate agents, financial advisors, and moving companies to assist with the transition.

5. Prepare your current home for sale

Maximising the sale price of your current home can provide additional funds for your upsizing journey. Consider the following tips:

• Repairs and renovations: Address any necessary repairs and consider making strategic renovations to increase your home’s value.
• Staging: Stage your home to highlight its best features and appeal to potential buyers.
• Marketing: Work with a real estate agent to develop a comprehensive marketing plan, including professional photography, online listings, and open houses.

6. Consider the long-term implications

While upsizing offers immediate benefits, it’s important to consider the long-term implications. Ensure that your new home fits your long-term financial and lifestyle goals. Evaluate the ongoing costs of a larger home, such as higher utility bills, maintenance expenses, and property taxes.

Case study: Upsizing with the help of bridging finance

Consider the example of Emily and Tom, a couple in Brisbane looking to upsize from their two-bedroom apartment to a larger four-bedroom house to accommodate their growing family. They found their dream home but needed to sell their current apartment to finance the purchase. Concerned about the timing and potential stress of synchronising the transactions, they opted for a bridging loan from Funding.

With the funds provided by the bridging loan, Emily and Tom were able to:

• Purchase their new home immediately.
• Move in and start enjoying their new space without delay.
• Take their time to sell their current apartment, ensuring they could maximise its sale price without the pressure of a tight deadline.

This seamless transition allowed Emily and Tom to upsize with ease and start their new chapter in the home of their dreams.

Conclusion

Upsizing your home is an exciting but complex process that requires careful planning and financial management. By leveraging short-term property finance solutions such as bridging loans, you can navigate the challenges of synchronising property transactions and secure your dream home without undue stress. If you’re considering upsizing and want to explore your financing options, short-term property finance from Funding can help you achieve your goals.

To learn more about how short-term property finance can support your upsizing journey, explore our Learning Centre. Visit Funding’s Bridging Loans page for more information.

Learn more

For additional resources and information on upsizing and property finance, explore these helpful links:

• How to enhance kerb appeal
• Understanding short-term property finance
• Home equity financing: Unlocking the value in your property

By leveraging the right strategies and financial solutions, you can navigate the complexities of upsizing with confidence and ease, ensuring a successful transition to your new, larger home.