Mortgage stress is set to get worse. Is it time to sell?

If you’re counting your dollars and cents and barely scraping by each month, you might start to wonder if now is a good time to sell? Don’t worry, you’re not alone. Australia’s mortgage market is experiencing a huge shift, with many homeowners coming off two-year and three-year fixed-rate loans onto much higher variable rates.

As of March this year, about 25% of fixed-rate loans had expired, soon another 40% will expire; and by the end of next year, another 20%. So, if you’re feeling a little (or a lot) of mortgage stress [link to my other article] because of this “fixed-rate cliff”, then you may be considering what you can do to reduce your debt. Here are five questions you should ask yourself to help work out your next steps.

1. Do I need to sell my house?

Our homes (and even our investment properties) can hold an emotional connection for us, so it’s important to sit down and really understand the reasons you might need to sell now. Perhaps you need to relieve mortgage repayments pressures, perhaps your facing repossession or foreclosure, looking to downsize or just wanting to move on and save money. Either way, understanding the harsh reality of why you might need put your property on the market, will help you look at the sale as more of a “transaction”, as opposed to an emotional event. 

2. What is the state of my finances?

Unbelievably, around 86% of the Australian population doesn’t know how much money they are spending every month, and a further 82% don’t know what their mortgage rate actually is. Do you? When you’re thinking of selling up, you need to know and understand your finances down to the dollar. This is especially important if you’re facing financial hardship, avoiding repossession or foreclosure, or just setting your expectation of how much you’ll need in your bank account to be financially sound.

3. What type of home do you want to buy or rent next?

Knowing where you’d like to move next will help dictate how you manage any debt you have, as well as any profit you will make selling your house and any changes in your income. Will you be renting from now on, moving in with family or buying a new house? If it’s the later, how much money will you need in order to buy somewhere affordable with a mortgage that’s easier to service than your current one? What kind of costs will be incurred when you move? These are questions that will help you understand your needs from a sale.

4. What is my timeline?

Knowing how much time you have to sell your house will allow you to make some important decisions. Do you need to sell within a month or three months? Do you need the money to hit your bank account on a certain day for a certain reason, or are you flexible? Do you need to get the banks off your back as soon as possible, or do you have some breathing room?

5. How can I make the most of selling my house?

There is an influx of homes on the market right now, so the key to selling your home for the most profit is to stand out from the crowd. This could involve cleaning, painting, changing the floor plan, renovating kitchens and bathrooms, and styling for today’s buyer. Don’t have that kind of time or cash available? That’s where Your Property Profits comes in. Our Financial Assistance Package goes hand in hand with our flagship zero-upfront-cost, renovation‑for‑profit service. It’s not means tested and you don’t need to jump through any hoops to take advantage of it. Basically, we supply you with the financial assistance you need to get rid of debts from the banks, then use our knowledge, experience, and funds to renovate your house to get you the maximum possible price when you sell.

Our team of builders, tradies, stylists, and specialised experts can find the potential in any property, renovating it to be a buyer’s dream home – leaving you with a faster sale and likely more money in your back pocket. It’s a win-win.

Interested in finding out what Your Property Profits can do for you? Find out more or contact us for a chat about your home.