Upgrading or downsizing

Sell first is the lower-risk option financially: you know your budget and you don't risk carrying two mortgages. Buy first works in slow markets where you can negotiate a long settlement on the purchase (90-120 days) and where you're confident your current home will sell quickly. If timing genuinely won't line up either way, bridging finance is the third option — expensive, but sometimes the right call.

Bridging finance is a short-term loan (usually 6-12 months) that covers the gap between buying a new home and selling the old one. You pay interest on the 'peak debt' (the combined value of both loans) for the bridging period. The interest rate is typically 1-2% above the standard variable rate. Once the old home sells, the proceeds pay down the peak debt and you transition to a standard mortgage on the new home.

Stamp duty on an upgrade is calculated at the full (non-first-home) rate on the new purchase price. As an indicative scale: a $1m purchase in NSW costs around $40,000; in VIC around $55,000; in QLD around $34,000; in WA around $42,000. There is no stamp duty refund or credit for selling your old home. Build the full stamp duty into your true cost of moving.

Yes, this is called 'porting' the mortgage. Most lenders allow you to transfer the loan from one property to another without re-paying establishment fees, provided the new property meets their lending criteria and the loan amount stays the same or smaller. If you're borrowing more, you'll be assessed for the top-up. Porting saves break costs on fixed-rate loans and re-application fees, but always compare with what's available on the market — the existing loan may not be the cheapest option.

Australians aged 55 and over who sell a home they've owned for at least 10 years can contribute up to $300,000 each (so $600,000 per couple) of the sale proceeds into super as a downsizer contribution. The contribution doesn't count toward the normal contribution caps and isn't subject to the work test. It's a useful tax-effective way to convert home equity into retirement savings.

Plan on 60-120 days from listing to settlement on the sale, plus 30-60 days from offer to settlement on the purchase. If you sequence them well (long settlement on the sale, fast settlement on the purchase) it can all happen within 90-120 days from listing. If the timing slips, you're either in short-term rental or carrying two mortgages briefly — both are manageable with planning.