When buying property for the first time, a major concern and focus is always about what will be the right investment decision.
So here are five key questions everyone should consider when buying a property.
1. What Type of Property Should You Buy and Where Should it be Located?
One of the crucial concerns that come to mind when purchasing a home is the location of a property. Ensure that you inspect and look around the area where you intend to buy in. For example, if infrastructure projects are running in the area, the property prices will be higher. Moreover, it is advisable to always get a valuation report of a house that you wish to purchase. This is helpful when determining the property value and you can ask the broker to get the report for you.
The major banks or lending institutions of Australia maintain a restricted list that includes high-risk locations, such as city suburbs or high-density areas. The loan amount and lending policies are determined on the basis of locations on this list.
Consider this: If you are looking at renting out your property in the long term, what sort of person would want to live there? How do the amenities in the area correlate to their lifestyle?
2. Consult a Mortgage Broker
Without consulting a mortgage broker, it will be difficult for you to find the right property in Australia. Brokers maintain a good relationship with financial institutions and so, they can help you get a loan on reasonable terms. They can also provide you with a list of recommended solicitors or conveyancers that can assist you in purchasing the right property for you.
Speak to our team about this step now: 1300 065 088 or email [email protected]
3. Do You Qualify for the First Home Owner Grant?
If this is the first time you are intending to buy a property in Australia, you should check whether you qualify for the one-off First Home Owner Grant. Every state has its own type of grant. However, there are some general criteria that are required to be met, including:
• A person, buying a property, should be an individual and not a trust or a company
• At least one applicant must hold a permanent residency or an Australian citizen
• The minimum age of all the applicants must not be below 18
• It would be a primary place of residence for one of the applicants for at least six months. The time period will begin within twelve months from the date of settlement or construction of property
You must contact the state government to find out all the required details, as they may vary based on the type of property you are buying. For example, it will depend on whether you are purchasing a new house or buying a land to build one.
4. Do You Have the Finances to Buy a Property?
This is one of the primary factors that need to be considered when buying a property. When you plan to purchase a home, you have to bear in mind the extra cost involved in it.
Following are the extra costs you must incur upfront:
• Fees Charged by Financial Institutions
Search the market before choosing a lender because the costs associated with the loan amount varies from one bank to another. Hunter Galloway’s team of mortgage brokers can do this for you at no cost.
• Fee Charged for Property Valuation
This fee will also be different for every bank and the amount varies between $50 and $300. There are a few lenders who carry out property valuation free of cost.
• Stamp Duty
Tax charged by the government on the value of a property and varies between 3 percent and 5 percent of the purchase price of the house.
• Transfer Fee Registration
It includes the cost related to the ownership registration with the concerned state department.
• Cost of Inspection
This cost is related to the pest or building inspection and it is based on the extent of inspection carried out.
• Legal Fee
Again, this cost varies from one solicitor to another. You can inquire about the fee charged by them, to manage the overall conveyancing cost associated with your house.
• Council Rate
This cost is paid to the local council and the amount varies from council to council.
5. Are You Prepared to Apply for A Home Loan?
To be prepared for your home loan, get your documents ready for inspection. This will include payslips, a letter from your employer, or tax returns, etc., to gather evidence for your income. Moreover, lenders prefer to give loans to individuals who have good credit rating. Therefore, always try to maintain a good credit score by paying your loans or bills on time.
These are some of the crucial questions you must keep in mind whenever you plan to buy a house. It will enable you to take the right decision without causing any delays.