The real cost of waiting for the "right" conditions
Most people think the goal is always the lowest interest rate available. My goal has always been getting control of an appreciating asset as early as I can, and the rate is a separate problem I solve for afterward.
My partner and I recently settled on a property in Wodonga for $655,000. It's a market I rate highly and have been active in for clients for a while. Ten year compound annual growth there sits around 8.5 percent, and it's held that pace because of a diverse local economy rather than one dominant industry.
We released $300,000 in equity last July, ahead of my partner going on maternity leave, so the portfolio had both deposits and buffering ready before the income change arrived. Of that, $165,000 went into this purchase.
The complication was serviceability. With reduced household income while my partner was on leave, we couldn't get this deal through a tier one lender. We went with a lower tier lender instead, at 8.75 percent. That's a real cost, and I'm not dressing it up as anything else.
Waiting for a better rate was the easier option. Nobody would have questioned it, given the timing. I've watched clients make that exact call before, waiting on the sidelines for things to improve, only to find themselves buying later at a higher price than the one they walked away from.
Here's why we did it anyway.
We still had $140,000, held back from that same equity release plus our other savings rather than fully deployed. That buffer exists specifically to cover situations like this one, a period where servicing is tighter than usual but the underlying decision is sound. We're already strong savers, and that capacity only grows as my partner's income increases. Three days a week now, four from September, full time from January 2027. We have a plan to refinance onto a better rate once that income lifts. We also have a backup plan of other lenders who may take the loan at the twelve month mark, subject to lending policy at the time.