Upgrading or Downsizing - Loans for your next move
Life changes. Your home should change with it. Whether you’re ready to upgrade your home and need a bigger space, planning to downsize for retirement, or exploring how to use your home equity to buy another property. Awesome will help you move to what’s next as smoothly and financially soundly as possible.
As a mortgage broker specialising in upgrading and downsizing, I work with homeowners across Australia to make the most of the equity they’ve built and find the right finance for their next chapter. Whether you need a bridging loan to buy before you sell, or a downsizer home loan that fits your retirement plans, we’ll build a strategy around your situation, not a one-size-fits-all solution.
Your next home starts with your current one
For most Australians, the biggest asset they own is the home they’re already living in. When it’s time to move, whether that means upgrading to something bigger or downsizing to something more manageable, that equity becomes your most powerful tool.
The challenge is that moving home involves more moving parts than most people expect. Timing the sale of your current property, securing finance for the next one, and making sure the numbers stack up along the way requires careful planning. Get it right and the transition is seamless. Get it wrong and you can find yourself rushed, under-resourced, or paying more than you need to.
At Awesome Lending Solutions, we work with upgraders and downsizers every day. Our job is to map out the right strategy for your situation, arrange the finance, and make sure the move happens on your terms, not someone else’s timeline.
Upgrading your home
Ready for more space, a better location, or a home that suits where life is heading? Upgrading is an exciting step, and with the right financial strategy in place, it doesn’t have to be stressful.
People upgrade for all kinds of reasons:
A growing family that’s outgrown the current space. The need for a home office. A better school zone. More land, or simply a home that reflects where they are in life now.
Whatever the reason, the starting point is the same: understanding how much equity you have and how to put it to work.
Your options for upgrading
Using your equity – If you bought your home for $500,000 and it’s now worth $700,000, you’ve built $200,000 in equity (less whatever you still owe on the loan). That equity can be used as a deposit toward your next purchase, reducing how much you need to borrow and potentially avoiding Lenders Mortgage Insurance.
Keeping your current home — Rather than selling, some upgraders choose to hold onto their existing property and convert it into an investment. The rental income helps service the loan, and you continue building wealth through two properties instead of one. This strategy requires careful structuring, and we’ll work through whether it makes sense for your financial position.
Bridging finance — If you want to buy your next home before selling your current one, a bridging loan makes that possible. It provides short-term finance to cover the gap between purchase and sale, so you’re not forced to rush the sale or settle for less than your property is worth. We’ll arrange the bridging finance and manage the process so the transition is as clean as possible.
Sell then buy — The more traditional approach. Sell your current home first, then use the proceeds to purchase the next one. This eliminates the need for bridging finance but requires careful timing and often means a period of temporary accommodation between settlement dates. We’ll help you plan around this if it’s the right path for you.
Downsizing your home
Children have moved out. The garden feels more like a chore than a pleasure. Stairs are becoming an issue. Or perhaps you’re simply ready for a change of pace. Downsizing is one of the most financially and practically sensible moves many Australians make, and it deserves the same careful planning as any other property decision.
The reasons people downsize are as varied as the people themselves. Empty nesters wanting less to maintain, retirees looking to free up capital, people wanting to move closer to family or amenities, or those seeking a single-level home better suited to their current lifestyle. Whatever the motivation, the financial opportunity that downsizing presents is significant.
Lower ongoing costs — A smaller property typically means lower council rates, reduced maintenance costs, lower utility bills, and less of your time spent keeping things running.
Freeing up capital — If your current home is worth considerably more than your next one, the difference becomes available cash. That money can fund retirement, travel, help family members, or simply provide a financial buffer that improves your quality of life.
Downsizer super contributions — If you’re 55 or older, you may be eligible to contribute up to $300,000 from the proceeds of your home sale directly into your superannuation. This is one of the most valuable financial opportunities available to downsizers and is worth discussing with your financial adviser early in the process.
Less work, better lifestyle — A townhouse, apartment, or smaller home in the right location can dramatically reduce the time and energy spent on property maintenance, freeing you up for the things that actually matter.
Do you need a loan when downsizing?
Not always. Many downsizers find that the proceeds from their sale comfortably cover the purchase of their next property, with money left over.
There are situations where finance still plays a useful role, buying before you sell, purchasing in a location where prices are higher than expected, renovating or customising the new property, or simply keeping a cash reserve rather than putting everything into the purchase.
We’ll help you work out the right approach for your situation, whether that means arranging finance, structuring a bridging loan, or simply making sure the timing and numbers align correctly.
What we help you with
Every upgrader and downsizer situation is different, so the advice we give is always specific to you.
Broadly, we help you calculate how much equity is available in your current home. Map out the right move strategy for your circumstances. If required, arrange bridging finance if you’re buying before you sell. We will review and refinance your loan for the new property if required. Finally, we structure things correctly if you’re keeping your existing home as an investment.
For downsizers, we also make sure you’re across the financial opportunities that apply to your age and situation. These may include super contribution rules, and we will coordinate with your accountant or financial adviser where needed.
Why timing matters
One of the biggest sources of stress in any property move is timing. Selling too early can leave you without somewhere to live. Selling too late can leave you scrambling to complete a purchase. Bridging finance solves this problem by giving you the flexibility to buy when the right property comes up, move at your own pace, and sell your existing home without pressure.
We’ll be upfront about the costs involved in bridging finance and make sure it’s the right call for your situation, not just a convenient one.
Ready to plan your next move? Get in touch and let’s work out the right strategy for where you’re heading.
Frequently Asked Questions
How do I know how much equity I can use from my current home?
Your usable equity is generally the difference between your property’s current market value and what you still owe on your loan, though lenders typically allow you to access up to 80% of the property’s value without paying Lenders Mortgage Insurance.
For example, if your home is worth $800,000 and you owe $300,000, you may have up to $340,000 in usable equity. We’ll work this out with you early in the conversation so you have a clear picture of what you’re working with.
What is a bridging loan and how does it work?
A bridging loan is short-term finance that allows you to buy your next property before you’ve sold your current one. The loan covers the gap between the two transactions. Once your existing home sells, the proceeds pay down the bridging loan and you’re left with just the ongoing mortgage on your new property. Bridging loans are typically interest-only and run for six to twelve months. We’ll assess whether bridging finance makes sense for your situation and arrange it if it does.
Can I get a loan if I'm retired or semi-retired?
Yes. Many lenders will consider loan applications from retirees, particularly where there is superannuation income, rental income, investment returns, or significant assets. Lending criteria for retirees varies between lenders, some are far more flexible than others, and finding the right one for your situation is exactly what we do. We work with retirees regularly and understand how to present your application in the best possible light.
What if I want to keep my current home as an investment when I upgrade?
This is a strategy worth exploring seriously. If you hold your current home and rent it out, the rental income helps service the loan while you continue to benefit from any future growth in the property’s value. The key is making sure the loan structure is set up correctly from the beginning. There are also tax considerations to discuss with your accountant, particularly around interest deductibility and capital gains. We’ll work with your existing advisers or point you in the right direction if needed.
What is the downsizer super contribution and who is eligible?
If you’re 55 or older and have owned your home for at least ten years, you may be eligible to contribute up to $300,000 (or $600,000 for a couple) from the proceeds of your home sale into your superannuation, outside of the usual contribution caps. This can be a significant boost to retirement savings. Eligibility conditions apply and the rules are specific, so we always recommend speaking with a financial adviser or accountant to confirm your situation before taking any steps.
How long does the upgrading or downsizing process take from start to finish?
Pre-approval typically takes three to five business days once your documents are in order. Full approval after you’ve found a property usually takes one to two weeks, depending on the lender. If you’re using bridging finance, the timeline is similar but involves coordinating both the purchase and the sale simultaneously. We manage this process closely and keep you updated so nothing catches you off guard.
What if my income is lower now than when I first bought my home?
This is a common situation, particularly for those approaching or in retirement. If you’re downsizing, you’re generally borrowing less — which means the income requirements are lower too. For upgraders whose income has changed, we identify lenders who assess your full financial picture, including assets, superannuation, and investment income, rather than focusing solely on employment income. There are more options available than most people expect.
Do I have to pay stamp duty when I move to my next home?
Stamp duty applies to most property purchases in Australia, though the amount varies by state and the purchase price of the property. Some states offer concessions for downsizers or seniors, these vary and are worth checking for your specific location. Your conveyancer or solicitor will confirm the stamp duty applicable to your purchase, and we’ll factor it into the overall cost planning from the start.
Is a bridging loan expensive?
Bridging loans typically carry a slightly higher interest rate than standard home loans, and interest accrues on the total debt — your new loan plus the outstanding balance on your existing home, until the sale is complete. For most people, the cost is worthwhile given the flexibility and certainty it provides. We’ll model the numbers for your specific situation so you can make an informed decision about whether bridging finance is the right tool.
Can I downsize to a property that costs more than my current home?
Yes, downsizing in terms of size doesn’t always mean downsizing in terms of price. Many people move to a smaller property in a better location, a newer building, or a more convenient area that comes with a higher price tag. In these cases, a loan may be needed to cover the difference. We’ll work out exactly how much finance is required, compare your options, and make sure the loan is structured to suit your retirement or lifestyle goals.