The hard part of downsizing isn't the money. It's the timing.
You've found the smaller, easier place — but the family home hasn't sold yet, and you don't want to move twice or rent in between. Bridging finance lets you buy first and sell after, on your own timing. Here's how the money moves through a downsizer's sell-and-buy, what the downsizer super contribution actually is, and how lenders assess someone who's asset-rich but living on a modest income.
Buy the new place first, sell the family home after — bridging covers the gap.
A bridging loan briefly lets you owe both properties at once. During the bridge you carry "peak debt" — the new purchase plus anything still owing on the old home, plus costs. Once the family home sells, the net proceeds are applied and the debt drops to your "end debt" — for most downsizers, that's nil, often with cash left over. The chart traces the debt through a single, illustrative sell-and-buy.
Illustrative example only, not an offer of credit, a quote or a promise of approval. Scenario shown: ~$1.2M family home with $150k owing, buying a ~$800k smaller home; peak debt ≈ new purchase + existing loan + costs, cleared by the net sale proceeds so end debt is nil. Real figures depend on both property values, selling and buying costs, the lender, your income and the bridging term (commonly up to ~6–12 months). Lenders cap peak debt at a maximum LVR across both properties and want a credible sale plan. Your actual numbers are confirmed in writing.
Which path fits depends on when you want to sell.
Bridging finance
Secure the smaller home now and sell the family home after you've moved. You briefly hold both, on interest-only over the bridge, then the sale clears the debt. Best when you've found the right place and don't want to move twice or rent in between.
Sell then buy (or subject-to-sale)
Sell the family home first — sometimes buying "subject to sale" of your current one — so you know exactly what you have to spend. Many downsizers then buy the smaller place outright with no mortgage at all. Cleanest, but ties you to the sale timeline.
Small end debt
Buy a better-located or higher-quality smaller home and keep a modest loan, so more of your equity stays liquid for retirement, travel or helping family. The residual loan is sized to what your retirement income can comfortably service.
The downsizer super contribution: up to $300k each, from the sale.
If you're 55 or older and sell a home you've owned for 10+ years, the ATO's downsizer measure lets each eligible person put up to $300,000 of the proceeds into super — up to $600,000 for a couple — and it doesn't count toward your usual contribution caps. It's a way to move money from the sale into the concessionally taxed super system. The rules are specific, so the detail matters:
This is general information, not tax, financial or superannuation advice — eligibility and outcomes depend on your circumstances, and a downsizer contribution can affect Age Pension asset testing. Confirm the current rules and your eligibility with your accountant or financial adviser and the ATO before acting. Source: ATO — Downsizer super contributions (as at July 2026).
Retired doesn't mean unlendable — it means assessed differently.
Downsizers are often equity-rich but show a modest income on paper. Lenders focus on sustainable retirement income and a clear exit for any residual debt, rather than a payslip.
Rates are indicative and change — variable rates move with the RBA cash rate and lender pricing, and any advertised rate carries a comparison-rate warning (see below). Sources: RBA Monetary Policy Decision, 16 June 2026. Serviceability, loan term and exit-strategy requirements vary by lender; figures are general information, not an offer of credit.
One move, not two — and no rent in between
Structured well, a downsizer's bridge means you buy the smaller home, move once at your own pace, then sell the family home without the pressure of a settlement clock forcing a fire-sale. We map the peak debt, the maximum both-property LVR your lender allows, and a realistic sale timeframe before you commit to anything.
All figures are illustrative and depend on your properties, costs and lender. Bridging carries risks — including the departing home taking longer to sell than expected — which we'll talk through with you.
Downsizing finance, answered straight.
Can I buy the smaller home before my family home sells?
Yes — that's exactly what bridging finance is for. The lender funds the new purchase while you still own the old home, so you move once and sell after. During the bridge you owe both (your "peak debt") and usually pay interest only; once the family home settles, the net proceeds are applied and the loan drops to your "end debt", which for most downsizers is nil. Lenders cap the combined LVR across both properties and want a credible plan to sell.
How long do I have to sell the old home under a bridging loan?
Bridging terms are commonly around six to twelve months (it varies by lender). The idea is to give you time to sell properly rather than at a discount. If the sale looks like running late, talk to us early — options include extending, re-listing strategy, or structuring the residual as an ongoing "end debt" loan you can service.
Can I get a home loan if I'm retired or over 70?
Often, yes. Lenders assess sustainable retirement income — account-based or super pension, age pension, and investment or rental income — rather than a payslip, and they'll ask for an exit strategy for any debt that remains (frequently the sale of the departing home itself). Fewer lenders operate at the older end and terms are usually shorter, but being equity-rich works in your favour. We match you to lenders whose retirement-lending policy fits.
What is the downsizer super contribution, and am I eligible?
It's an ATO measure that lets people aged 55 or older put up to $300,000 each ($600,000 per couple) from the sale of a home they've owned for 10+ years into super, outside the normal contribution caps. You must contribute within 90 days of settlement, lodge the ATO downsizer form (NAT 75073) with your fund, and it's available for one home in your lifetime. This is general information, not tax or financial advice, and it can affect Age Pension testing — confirm your eligibility with your accountant or adviser and the ATO.
Do I have to take out a mortgage at all when I downsize?
Not necessarily. Many downsizers sell first and buy the smaller home outright with no loan. Others keep a small "end debt" on purpose — to hold more cash for retirement or to buy a better-located place — sized to what their retirement income can comfortably service. And some only need finance briefly, via bridging, to buy before they sell. We'll help you compare the three.
How many lenders do you compare, and what does it cost me?
We compare products from our panel of 50 lenders (we don't compare every lender in the market). Our service is generally at no cost to you where the lender pays commission on settlement; if a fee ever applies we tell you in writing first. You can start with our online options check — no credit check to begin, so it won't affect your credit file.
Thinking about downsizing? Let's get the timing right.
Tell us about your current home, where you're heading and roughly when — we'll map the bridge (or the sell-first path), compare lenders, and make sure the numbers work before you commit. No credit check to start.
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