Buying a larger home is one of the most significant financial decisions you’re ever likely to make. So, it’s important to make the right purchase for the right reasons.
It’s a legitimate strategy to buy a bigger home to increase your investment in the property market. However, most of us are in the upsizing market to cope with the needs of a growing family.
As an experienced neighborhood agent, I’ve found that the most successful upsize buyers are those who thought hard about why they wanted a bigger home before diving into the market.
Spending time to analyse what you need will make the difference between a successful purchase and discovering down the track that the property is either too big or not big enough. That’s a mistake that can cost you tens of thousands of dollars in lost value and taxes.
Having worked with many buyers on their upsizing ambitions, I’ve pulled together five questions that you should ask before setting your heart on a bigger home. I’m sure they’ll keep you on track to make an excellent purchase.
- What problem are we trying to solve?
Be clear about the challenge presented by your current property. Are you suffering a space shortage, or do you like the idea of owning a bigger home and the long-term investment benefits that it will deliver? There’s no wrong reason, but understanding your motivation will help you make the right purchase.
- Do you need more space?
This is the question most folks ask themselves when they consider upsizing. But here’s a better question: “how many rooms do I really need?” To answer, start with the bedrooms. Are children sharing, and will there be a time when each of them needs their own space? Perhaps the living space is cramped, or you want some privacy or a home office? All these reasons are legitimate and should influence your property search.
- What is your budget?
Use a mortgage broker or bank adviser to give you an indication of your borrowing capacity and double-check the equity in your existing home. Also, be clear on whether you can afford the running costs of a larger home. Your utility bills and taxes will go up as well.
- How long do you want to be in a larger home?
Many buyers upsize when their children are teenagers. But it only takes a few years before they’re leaving the nest and you’re rattling around in a big house. Even if they stick around a little while longer and treat the place like a hotel, it won’t be long before you’re wondering whether you made the right purchase for your lifestyle.
- Where do you want to live?
Upsizing is not just about finding a bigger property but choosing the right location. For most people, this will be a long-term decision, so be sure to pick an area that suits your lifestyle.