How much equity do you need to upsize in Brisbane?

The number most Brisbane families target is wrong. Here is how to calculate what you actually need before you start looking at larger properties.

The 20 percent rule

Most lenders require 20 percent equity in a new purchase to avoid lenders mortgage insurance. On a $1.5m property in Brisbane's inner south, that means $300,000 in deposit from the proceeds of your sale, after paying out your existing mortgage and covering costs.

The full cost calculation

Most upsizers focus on the deposit and forget the transaction costs. Stamp duty on a $1.5m Queensland property is approximately $60,000. Add agent commission on your sale (around $25,000 at 2.5%), conveyancing, removalists and any pre-sale preparation costs, and the total cost of the move is typically $90,000 to $120,000 on top of the deposit you need.

The bridging risk

If you buy before you sell, you may need bridging finance. Bridging loans carry a higher interest rate and typically run for six to twelve months. Understanding the total cost of bridging before you commit is essential. Roxanne can connect you with a trusted broker to run the numbers for your specific situation.