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  1. #1
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    Default Home loan finance advice

    Dh and I want to move to another area that is more expensive than where we are now.
    I am not sure if we should make the move now or in around 4-5 yrs time.

    Our house now is worth around $420-440k and we owe the bank around $210K
    The properties we are looking at are around $600-630K
    That means we will end up with a new loan of around $400-420K

    However if we pay off our $210K loan in the next 4-5yrs (I estimated that using a bank website), I was thinking that in 4-5 yrs time we could sell our house, owing nothing to the bank and take out a new lower loan (around $300K)?

    If prices rise in our area over the next 4-5yrs (approx 30%?) and the other area slightly more (40%), I worked out that our new loan later on could be around $300,000 (which in 4-5yrs would seem less than it does now).

    So am I on track or totally off it. I am so confused. It is not like we are desperate to move now. I would be happy to wait if it was financially better. I just feel ill at the thought of having a new $400K home loan now!!!

  2. #2
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    Bump

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    Default Home loan finance advice

    It's a tough one sorry, without a crystal ball anyway!

    Prices could go up sure, but they could also crash in your area. Or prices could increase dramatically in your new area but not your current one. Sadly the housing market is a massive gamble!

    Perhaps research the housing market in both areas over a 5-10 year period? It may give you a better idea.

    In reality a mortgage of $400k is quite normal - or even low - in this day and age. Sad but true. Our poor children will struggle to buy a house in 30yrs!

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    Not sure where you live in Australia, but now is a good time to be selling houses under $500k as the market is still strong in the first home owner price range, but are softening in the more expensive areas.

    There's no guarantee that in 5 years time the area you want will still be $600k (could be 900k) and also no guarantee that your house will be $400k--it could go up to $500k or down to $300k).

    5 years is a long time in the cycle. My loan is over $800k.. can we swap haha

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    Thanks for your reply. Yeah I know it's a gamble. Like now property has dropped around Melbourne. Who would have thought?

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    Not in all suburbs. Good property in a good location is still selling well in Melbourne.

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    Sorry em, just saw your post. Wow $800k?! Where are you?

  8. #8
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    Quote Originally Posted by embee80 View Post
    Not in all suburbs. Good property in a good location is still selling well in Melbourne.
    Opps I was meant to edit that to parts of Melbourne.

  9. #9
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    Maybe I'll organize for a broker to come. See what we can borrow etc. I just want to stop thinking about this all soon!


 

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