REFINANCE, UPGRADE OR BOTH? WHAT HOME OWNERS SHOULD DO WHILE RATES ARE STILL LOW

Upgrading to a larger, better-positioned, or more valuable home can allow home owners to take advantage of surging prices, but a booming market can make the move challenging.

While it might be easier to achieve a great price when selling, it’s just about impossible to score a bargain in the current market, considering countless upgraders – who have put off a move for several years – are diving in at once.

“It’s when demand outstrips supply that the prices are high,” says Real Estate Institute of NSW president Leanne Pilkington. “We’ve got a couple of years of suppressed demand happening right now.”

“Eventually, that demand is going to start to ease off, but even if the clearance rates are down in the mid-70s, it’s still a really strong market.”

When prices rise across the board, the gap between the value of a home owner’s current property and a more expensive one grows, potentially pushing the most desirable properties out of reach.

The proportion of upgraders who buy before selling tends to increase when prices rise. Home owners are more confident they’ll achieve a strong result selling their original home, and many prefer selling quickly after buying rather than rushing to find a home after selling.

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