How To Decide Whether To Sell Or Hold Your Green Square Apartment

If you own a Green Square or Zetland apartment and your life is shifting, your exit strategy is simple in theory: sell if the numbers and risk say “too tight”, hold if you can carry the unit with sensible buffers and it serves your next decade.

In practice, the decision is emotional and messy. This guide strips it back to five numbers and a one‑week process so you can decide whether to sell or hold your Green Square apartment without blowing up your cashflow, tax position or future options.

Start with your life change, then let the numbers guide your exit strategy.

Step 1: Get clear on your life change and time frame

Before touching spreadsheets, define why you’re thinking about an exit and when pressure bites.

Common life shifts around Green Square

• Upgrading to a house (often inner‑ring suburbs)
• Moving interstate or overseas for work
• Starting or expanding a business
• Relationship changes – forming, separating, divorce
• Kids arriving or leaving home

Each scenario drives different constraints. For example, an upgrade may be better handled with a staged move, as covered in Smart ways to finance a move from Green Square to a house.

Write down:

1. Your key change (one sentence).
2. Your time horizon (e.g. “need decision within three months”).
3. Your risk tolerance (conservative / balanced / aggressive).

This frames the rest of the maths.

Step 2: Run the five-number exit check

You don’t need complex modelling. Focus on five numbers that make or break a Green Square exit.

1. Usable equity in your Green Square apartment

Indicative example:

• Current estimated value (agent + RP Data): $900,000
• Current loan: $650,000
• Selling costs (agent, marketing, legals): ~3% = $27,000

Equity if sold = $900,000 – $650,000 – $27,000 = $223,000.

Not all of this is “usable” for your next move – you’ll want some buffer left over.

2. Realistic rent or holding cost if you keep

Work out:

• Gross weekly rent you’d actually achieve (allow for vacancies)
• Strata, council, water, insurance
• Repairs and sinking fund contributions
• Interest and principal repayments

If you’re unsure whether your current loan is still sharp, read When Green Square Investors Should Reprice Or Refinance Their Unit Loans before deciding.

3. Cashflow stress test

Using Roy Morgan’s work on mortgage stress, and Local Knowledge’s internal guidance, a stressed repayment load above 35–40% of your after‑tax income is a bright orange flag for inner‑south borrowers.

So model stressed repayments at an interest rate 3% higher than today (aligned with APRA’s serviceability buffer) and ask:

• Total home + investment repayments under stress
• As a % of your after‑tax income

If that percentage is:

• <30% – generally comfortable
• 30–35% – watch list, you’ll want strong buffers
• 35–40%+ – exit or restructure should be on the table (see also Nine Debt Stress Red Flags For Inner‑South Borrowers To Act On).

4. Buffer after the move

As a practical rule from multiple articles in this hub, aim for:

• 3–6 months of total stressed holding costs for most households
• 6–12 months if you’re self‑employed or highly geared

Holding costs = mortgage(s) on all properties + strata + essential living costs.

5. Tax and structure

Key tax points (speak to your accountant for specifics):

• When your former home becomes an investment, interest is generally deductible only to the extent the loan funded that original property.
• Any equity release used for a new home or personal spending stays non‑deductible, even if secured against the old unit – so clean loan splits by purpose are critical.

This is the same principle we highlight for Mascot and Rose Bay clients and it absolutely applies in Green Square.