Key takeaways
The RBA cash rate is 4.35% after three increases in 2026, so check your current borrowing power before setting up a budget.
National dwelling values fell 1.9% over the three months to July, but conditions vary considerably between cities.
Your home equity could help fund your next property, but how much you can access depends on your circumstances and lender.
Buying first, selling first or keeping your current home each comes with different costs, risks and tax considerations.
When the dining table doubles as an office, there’s a queue for the bathroom and everyone’s running out of places to put their stuff, a bigger home can start to feel less like a nice-to-have and more like the next step.
Upsizing isn’t simply about adding another bedroom. You might need space for a growing family, teenagers who want some privacy, grandparents moving in, a proper home office or a backyard that gets everyone outside.
Whatever is driving the move, buying a bigger family home is also a major financial decision. Your existing equity, borrowing power, current home, buying costs, and the order in which you buy and sell can all shape what’s possible.
Here’s how to work through it step by step.
Step 1: Work out whether you’re ready to upsize
There’s no single sign that says it’s time to move. But if your current home hasn’t worked for your family for a while, it may be worth exploring your options.
Some common reasons families start thinking about upsizing include:
Your family is growing. A baby may be on the way, the kids might be ready for separate rooms or extended family could be moving in.
You need dedicated work or study space. If the kitchen bench has become a permanent office, an extra room could make everyday life easier.
Everyone needs more breathing room. A second living area, another bathroom or a more usable backyard could change how a busy household functions.
You’re planning further ahead. School zones, accessibility, space for teenagers or room for future renovations may matter more than they did when you bought your current home.
The question isn’t just whether you’d like a bigger house. It’s whether the move works for your family’s needs and finances.
And in the current interest rate environment, it’s worth checking rather than assuming how much you can borrow.
The Reserve Bank of Australia (RBA) has increased the cash rate three times during 2026. At its August meeting it held the cash rate at 4.35%.
Cotality estimates that the three rate increases reduced borrowing capacity for a median-income household by around 7%, or more than $53,000.
That means your borrowing power may look different from the last time you took out a home loan.
The takeaway: start with your family’s needs, then check what your finances can realistically support.
Step 2: Check your budget, borrowing power and equity
Before you start planning furniture for the extra bedroom, get clear on what you can comfortably afford.
Start with your must-haves: How many bedrooms do you need now and in a few years? Is a second bathroom more important than a larger backyard? Do you need a home office, or would a flexible second living space do the job?
Separating the essentials from the nice-to-haves can help keep your property search focused.
Check your borrowing power
Your borrowing power can change over time as your income, expenses, debts, interest rates and lender policies change.
Aussie’s Borrowing Power Calculator can give you an estimate based on the information you enter.
You can also talk to an Aussie Broker about your current position and the home loan options that may be available to you.
See how much equity you have
If you’ve owned your current property for a while, you may have built equity that could potentially help fund your next purchase.
Equity is broadly the difference between your property’s current value and the amount you still owe to it. But having equity doesn’t automatically mean you can access all of it.
How much you may be able to use will depend on factors including the property valuation, your loan-to-value ratio, lender requirements and your financial circumstances.
You can use the Live Equity Tracker in the Aussie app to get an estimate of your current equity.
Your next-home deposit could potentially come from:
cash savings
accessible equity in your existing property
proceeds from selling your current home
or a combination of these.
Remember to leave room in your budget for costs beyond the purchase price, including stamp duty, conveyancing, loan fees where applicable, moving costs and any immediate repairs or renovations.
Step 3: Decide whether to sell or keep your current home
One of the biggest decisions when upsizing is what happens to the home you’re leaving behind.
Selling it could unlock equity for your next purchase and reduce the number of loans you’re carrying. Keeping it and renting it out could give you an investment property, but it also brings another set of financial, lending and tax considerations.
If you sell your current home
Selling may:
give you a clearer idea of the funds available for your next purchase
reduce the debt a lender needs to consider
avoid the ongoing costs of owning an investment property.
The downside is timing. If your sale settles before your next home is ready, you may need temporary accommodation or storage.
If you keep your current home and rent it out
Keeping your property means you’ll need to consider rental income alongside expenses such as:
mortgage repayments
property management fees
insurance
repairs and maintenance
council and other property charges
periods when the property may be vacant.
Your existing mortgage and other commitments can also affect how much you’re able to borrow for your next home. There are important tax considerations, too.
From 1 July 2027, negative gearing for established residential properties acquired after 7:30pm AEST on 12 May 2026 will be limited so losses generally can’t be deducted against non-residential income such as wages. Excess losses can be carried forward.
Properties held before the cut-off are generally excluded from the new negative gearing rules.
So, if you’re considering turning your current home into an investment property, the tax treatment will depend on your individual circumstances, including when you acquired the property. Speak to a qualified tax adviser before making a decision.
What about capital gains tax?
Moving out doesn’t necessarily mean you immediately lose the main residence of CGT exemption.
The ATO says that if you move out of your main residence and use it to produce income, such as by renting it out, you may be able to continue treating it as your main residence for CGT purposes for up to six years.
You generally can’t treat another property as your main residence for the same period, although the ATO allows an overlap of up to six months when moving homes, subject to conditions.
Because the tax outcome depends on your circumstances, speak to a qualified tax adviser before deciding whether to sell or keep your existing property.
The takeaway: selling can give you more certainty about the funds available for your next home, while keeping your property could give you an investment asset. The right option depends on your finances, goals, and tax circumstances.
Step 4: Decide whether to buy first or sell first
Even if you know you’re selling your current home, there’s another decision to make: which transaction happens first?
Pros | Things to consider | |
Buy first | More flexibility to secure your next home; less pressure to coordinate settlement dates | You may temporarily carry more debt and have more costs and moving parts to manage |
Sell first | Gives you greater certainty about your available funds and next-home budget | You could need temporary accommodation if you don’t find your next home before settlement |
There’s no single approach that works for every family. Your equity, borrowing capacity, cash flow, property market and preferred settlement timing all matter.
Clay Bremer from Aussie Coolum says bridging finance is increasingly coming up in conversations with customers making their next move.
“We're getting more and more enquiries about bridging loans from people making changes, whether they're upsizing or downsizing,” he says.
Could bridging finance help?
If you want to buy your next home before selling your existing one, bridging finance may be an option.
Aussie Bridge, powered by Bridgit, is designed to provide access to property equity before your existing home is sold.
Clay also shared that he recently worked with a customer who wanted to purchase and renovate his next property while selling his existing home.
“We've just put in an application so he can buy the next property without making the purchase conditional on selling his current home,” he says.
In this type of scenario, bridging finance may allow an eligible borrower to purchase their next property before their existing property is sold.
Aussie Bridge currently offers:
terms of up to 24 months
no monthly repayments during the bridging term, with interest included in the loan amount
conditional approval within 24 hours.
Eligibility, lending criteria, fees, and other conditions apply.
When your existing property is sold, the bridging loan is repaid or partially repaid. Depending on your circumstances and the value of your new home, you may still have an ongoing home loan after the sale.
Bridging finance comes with costs and eligibility requirements, so understand how the loan and interest work before deciding whether it suits your circumstances.
You might also be interested in: Bridging loans and bridging finance explained
Step 5: Understand the property market you’re buying into
Australia’s housing market isn’t moving in one direction.
According to Cotality’s August 2026 Monthly Housing Chart Pack, national dwelling values fell 1.9% over the three months to July, while remaining 5.3% higher over the year. Conditions varied considerably between capital cities.
Over the three months to July, dwelling values fell 4.0% in Sydney, 3.4% in Melbourne, 0.6% in Brisbane, 0.3% in Perth and 2.1% in Canberra. Adelaide increased 0.1%, while Hobart rose 1.4%.
The annual picture looks different again. Over the 12 months to July, values fell 2.0% in Sydney and 2.8% in Melbourne, while increasing 14.8% in Brisbane, 10.5% in Adelaide, 20.5% in Perth, 9.3% in Hobart and 1.0% in Canberra.
That variation is a good reminder that national property headlines won’t necessarily tell you what’s happening in the suburb where you want to upsize.
How selling conditions are changing
There are also signs that conditions have become more favourable for buyers in some parts of the market.
Cotality reported that total property listings nationally were 14.9% higher than a year earlier over the four weeks ending 9 August 2026.
The median time to sell increased to 35 days over the three months to July, while the national median vendor discount widened to 3.8%.
Cotality notes that increasing vendor discounts have coincided with more properties being listed for sale, giving buyers greater negotiating power overall. However, conditions differ between cities, suburbs, and individual properties.
So, before making an offer, look at recent comparable sales, local listings and how long similar family homes are taking to sell in the area you’re considering.
“You don't need to rush into buying a property. You can actually find a deal out there. There are some good deals because people are negotiating a lot more,” says Clay.
Step 6: Find a home that fits family life
Once you’ve worked out your budget, it’s time to think about what “bigger” actually needs to look like.
Look for flexible spaces
An extra bedroom is useful, but flexible layouts can work just as hard.
A second living room might be a playroom today and a teenage retreat later. A study could become a nursery or guest room. A garage or multipurpose area may give you options as your family changes.
Think about the school run and commute
A larger home may not feel like an upgrade if it adds hours to your weekly travel.
Look at:
school and childcare locations
public transport
travel times to work
shops and healthcare
sport and recreation facilities
parks and other spaces your family actually uses.
If a particular school catchment matters to you, check the current enrolment boundaries directly with the relevant education authority or school.
Choose a yard you can actually use
You don’t necessarily need a huge block. A secure, functional outdoor area may be more useful than extra land that takes up every weekend with maintenance.
Think about pets, outdoor play, entertainment, privacy, and how much upkeep you’re willing to take on.
Leave room for the future
Even if you’re not renovating immediately, consider what the property could accommodate later.
Could the floor plan change as the kids get older? Is there room to extend, subject to council approval? Could accessibility become important for parents or grandparents?
A little flexibility now could help the home keep working for you for longer.
Step 7: Think about ongoing costs, not just extra space
A bigger property can also mean bigger ongoing costs.
Before you buy, think about:
energy use
council rates
home and contents insurance
maintenance
gardening and outdoor upkeep
strata or body corporate fees, where relevant
future renovations.
Energy-efficient features such as insulation, solar, efficient heating and cooling, or energy-monitoring technology may also be worth considering.
Smart-home features can make day-to-day life more convenient, from lighting and security to reliable home-office connectivity. But focus on features you’ll genuinely use rather than technology for technology’s sake.
Step 8: Compare home loan options for your next move
Upsizing often means changing your loan as well as your address.
Depending on your circumstances, options could include:
Variable-rate home loans, where your interest rate can move over time and the loan may offer features such as offset or redraw.
Fixed-rate home loans, which fix your interest rate for an agreed period.
Split home loans, which divide your loan between fixed and variable portions.
Interest-only home loans, which may be available in some circumstances, including for investment lending.
The features, rates and fees available will depend on the lender, loan, and your circumstances.
An Aussie Broker can help you understand your borrowing position and compare available loan options from Aussie’s lender panel.
Make your next home work for what’s next
Upsizing is more than moving into a bigger floor plan. It’s about finding a home that works better for the life your family is building.
That could mean another bedroom, a quieter place to work, room for teenagers to spread out, or simply a backyard where everyone can spend more time together.
Before you start making offers, get clear on your budget, equity, loan options and what will happen to your existing home.
An Aussie Broker can help you work through the numbers, understand your home loan options and plan the financing side of your next move. Ready to plan your next move? Book a chat with an Aussie Broker.
