Selling guide · 3 min read · Checked 21 October 2026
Should I Buy First or Sell First?
In short
Selling first is the lower-risk option: you know exactly what you have to spend, though you may need to rent or negotiate a long settlement. Buying first secures the home you want, but you risk carrying two loans or having to sell in a hurry, which is riskier while Melbourne prices are softening. Long or matched settlements, a subject-to-sale condition, a rent-back or a bridging loan can narrow the gap.
Selling first
- You know your budget to the dollar before you commit to a purchase.
- You negotiate as a cash-ready buyer, which sellers like.
- No risk of carrying two loans.
- The catch: if you do not find the right home in time, you may need to rent and move twice. A long settlement on your sale buys time.
Buying first
- You secure the home you want without rushing.
- You move once.
- The catch: you may carry two loans, and if your home sells for less or takes longer than expected, you could end up selling under pressure. In a market where values have fallen over the past year, that risk is real.
Ways to narrow the gap
- Match the settlements: ask for a long settlement on your sale and a shorter one on your purchase, or the reverse, so they land close together.
- Rent back: ask your buyer whether you can lease the home back for a few weeks or months after settlement.
- Subject to sale: in a private sale you can ask for the purchase to depend on selling your current home. Many sellers will say no or want a short deadline, and you cannot add conditions at auction. If the condition is not met, the deposit is refunded.
- Line up both early: get a written estimate on your home and pre-approval on the purchase before you start looking seriously.
Bridging loans
A bridging loan covers the period when you own both homes. The lender lends against both properties, so your total loan at the start, called peak debt, includes your existing mortgage and the new purchase. When your old home sells, the proceeds pay it down to the end debt, the ongoing loan on your new home.
The big banks generally limit the bridging period to 12 months. Some let interest add to the loan during the bridge instead of charging repayments, which eases cash flow but increases what you owe. If your home sells for less than planned, the end debt will be higher than you expected.
Tax and duty while you own two homes
- Land tax: both homes can be exempt for one land tax year if neither earns income while it is not your home, you move into the new home within 12 months of buying and live there for six months in a row, and you sell the old home by the end of that land tax year.
- Capital gains tax: the ATO can treat both as your main residence for up to six months, if you lived in the old home for at least three months in a row in the year before selling it and it did not earn income while it was not your home.
- Stamp duty: there is no Victorian concession or refund for briefly owning two homes. You pay duty on the new home as normal.
Which is right for you
If your budget depends on what your current home sells for, selling first, or selling and buying within the same few weeks, is usually safer, especially while prices are softening. If you have plenty of equity and income to carry both loans for a while, buying first can work. Either way, start with a realistic, written value on your current home.
Questions
What people ask us
Is it better to buy or sell first in a falling market?
Selling first is usually safer when prices are falling, because you lock in your sale price before you commit to a purchase and avoid carrying two loans.
How long can a bridging loan last?
The big banks generally allow up to 12 months. Check whether interest is charged monthly or added to the loan, and what happens if your home has not sold by the end.
Can I make my purchase subject to selling my home?
In a private sale you can ask for that condition, but many sellers will refuse or set a short deadline. You cannot add conditions at auction.
Will I pay land tax if I own two homes while moving?
Possibly not. Both can be exempt for one land tax year if you meet the State Revenue Office conditions, including selling the old home by the end of that year.