Selling for less can feel like a reason to stay put. But if the home you want has fallen further in dollar terms, the cost of moving up may have come down too.
Mortgage aggregator Australian Finance Group (AFG) has released its September quarter figures, covering home loan applications from the more than 4,300 brokers who use its services. Upgraders accounted for a record 46% of those applications.
These are owners buying their next home, often using the equity in the one they already have.
So what are they seeing in a softer market, and could the same numbers work for you?
Why would you sell when prices are falling?
Because you're buying as well as selling. The price you get for your current home is only half the calculation.
Take an illustrative example. Your home was worth $800,000 and the one you wanted cost $1,200,000. The gap was $400,000. If both prices fall 5%, your home becomes worth $760,000 and the next one costs $1,140,000. The gap drops to $380,000, a $20,000 reduction before costs.
If you owe $300,000 on your current home, selling for $760,000 leaves $460,000 before selling costs. Put that towards the $1,140,000 purchase and you'd need a $680,000 loan before buying costs. In the original scenario, you would have needed $700,000.
That's how a lower sale price can still leave you needing less debt for the move. It doesn't mean every upgrader comes out ahead.
The example assumes both properties fall by the same percentage. Different suburbs and property types can move differently, and stamp duty, selling fees and moving costs still need their own budget. Use recent comparable sales for both homes before relying on the gap.
Does owning a home make the next loan easier?
It can help with the deposit. It doesn't settle the question of what you can repay.
Equity is your property's value minus what you owe on it. If you've owned your home for several years, repayments may have reduced the debt, and price changes may have added to or reduced the value.
Then look at the new loan against your current income and expenses. The bank still needs to assess whether you can afford it, even if you bring substantial equity to the purchase.
Under APRA's current lending standard, banks generally assess home loan repayments with an interest rate buffer of at least 3 percentage points above the loan rate.
Your own comfort limit matters too. Allow for the new home's running costs and any changes to your household income. A bigger deposit can help you qualify, but it won't pay the monthly mortgage once you've moved in.
What if you find the next home before yours sells?
You'll need a plan for the period when you own both properties.
A bridging loan can fund that gap. You buy the next home, then use the proceeds from selling your existing property to reduce the debt. The lender checks the properties, your finances and how the loan will work after the sale.
Terms vary. As one lender's example, CommBank offers a maximum bridging term of 12 months and requires interest-only payments during the bridge. A longer sale can mean more interest, and a lower sale price can leave you with more debt than planned.
Before you commit, work through these steps:
1. Get a realistic sale estimate and allow for selling costs.
2. Compare buying first with selling first, including temporary rent and moving costs.
3. Ask what happens if the sale takes longer or the price comes in lower.
Selling first gives you a clearer budget, though you may need somewhere to live between settlements. Buying first can make the move simpler, but only if you can carry the overlap and meet the lender's deadline.
When is it better to wait?
If the move only works at your best-case sale price, give yourself more room before signing anything.
Waiting may make sense if your income is about to fall, the repayments would use all your spare cash or you would have no reserve for an unexpected repair. You may also prefer to sell first if you can't comfortably fund a period with both properties.
Start by pricing the whole move: what you can realistically sell for, what you want to buy and the debt left afterwards. Moneysmart also recommends allowing for buying costs beyond the deposit.
If you're thinking about your next home, we can compare the finance for selling first and buying first, then work out a budget you can use when you're looking.
Sources: AFG September quarter index via Broker Daily, October 2026; CommBank bridging loans; APRA APS 220; Moneysmart. Rules checked 17 October 2026. Worked examples are illustrative, not market forecasts or loan offers.
General information only, not financial or credit advice. Consider your circumstances before acting.