With so much movement in Australia’s property market, it can be tempting to buy and sell frequently. After all, personal circumstances change, life events happen, and sometimes a move just makes sense. But for those in a position to hold onto their property longer, the rewards can be substantial, both financially and strategically.

According to Cotality, around 20% of current homeowners bought their property in the last five years, with 2021 being the most popular purchase year. These numbers show that plenty of Australians are still transacting fairly regularly. But they also highlight the opportunity that comes with resisting the urge to move too soon.

Capital Growth Favouring Long-Term Holders

One of the biggest advantages of holding onto a property long-term is the ability to build strong capital growth.

Cotality reports that:

• Australia’s median property price rose 70.2% over the last 10 years
• It’s up 157.9% over the past 20 years
• And a staggering 425.9% across the past 30 years

This means that those who bought in earlier cycles and held on have likely seen their wealth grow significantly, even through market downturns. The key insight here is that time in the market tends to outperform timing the market.

Minimising Transaction Costs

Frequent buying and selling also come with their own costs. Real estate agent fees, stamp duty, legal costs, and moving expenses can quickly eat into your profits. These costs aren’t trivial, and they can easily reach tens of thousands of dollars, especially in higher-value suburbs.

By holding onto a home longer, you can avoid repeated transaction costs and preserve more of your equity.

Turn Your Home Into an Investment Property

If you’ve outgrown your current property but don’t need to sell it to buy another, you might be able to convert your existing home into an investment property. This allows you to hold onto an asset you’ve already started building equity in, while using rental income to help service the loan.

This strategy can work well if:

• Your existing loan is under control
• The property is in a strong rental area
• You’re in a stable enough financial position to carry two loans (with rental income helping ease the burden)

It’s a way of starting or expanding a property portfolio without losing the growth potential of a home you already own.

Renovate Instead of Relocate

Another alternative to selling is to use your home equity to fund a renovation. If you love your location but need more space, or simply want a fresh look, you may be able to refinance and unlock equity for a home upgrade.

This approach helps you:

• Stay in a familiar neighbourhood
• Increase your home’s value
• Avoid the costs and stress of moving

And with spring traditionally being one of the busiest times for both property sales and loan activity, now could be a great time to explore your options, whether you’re renovating, investing, or just reviewing your loan.

At Peel Finance Brokers, we work with clients to build financial strategies that align with their life goals. If you’re considering whether to move, hold, invest, or renovate, we can help you crunch the numbers and find the right solution. Reach out to chat about pre-approval, refinancing, or accessing equity, and let’s plan your next move with confidence.

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