Real Estate Tips For First Home Buyers
The combined value of Australian residential real estate has touched $7.2 Trillion (CoreLogic Data). It is no surprise that more and more people are gearing up to buy their first home, especially when great home loan packages are still available.
In any case, the charm of staying in your own home is incomparable, isn’t it? But, considering that combined capital city house values have increased by 10.9 percent over the past 12 months (until July 17), respectively, are you sure you can afford the house of your dreams in the area you really wish to stay?
In December 2016, The New Daily published an article revealing that ‘a hard-saving couple will need 4.9 years to squirrel away a deposit for a median-priced house in one of the capital cities.’
It’s a long-road win, but here’s how you can do it.
Support for Home Buyers
Of course, first home buyers purchasing their own home could boost their savings with State Grants and stamp duty concessions. They can also opt for parent guarantee loans or pay LMI to secure a high LVR loan. However, there is a more affordable way for first home buyers to step into the property market.
Rentvesting, or renting where you want to and investing where you can afford to, is fast catching up with savvy first home buyers who are comfortable with the idea of buying an investment property as their first home. This not only allows them to continue with the lifestyle they are used to but also allows them to use the rental income from the investment property, and the gradually building equity, to fund their own home much sooner, without undergoing significant financial stress. Investment properties also offer major tax benefits that investors can gain from.
Buying a well-researched property
First home buyers who are looking to break into the housing market could benefit greatly from rentvesting. Affordability is a major factor to consider when buying a house. Instead of paying too much for a popular suburb that may have already peaked, it is smarter to look out for upcoming suburbs that are currently affordable but well serviced. Most of these areas fringe the popular suburbs, sharing the amenities but offering low-priced houses. Spot the next upcoming suburbs for your investment.
Being financially disciplined is the key to growing wealthy. Those who plan to buy a property must take a look at their expenses, and follow a household budget that minimises extra expenditure and maximises savings. Use Coronis Finance online calculators to set a budget or savings target.
Choosing the right home loan
Several banks, as well as non-bank lenders, offer home loans at competitive rates. When searching for a home loan, it pays to shop around and compare home loan deals online to choose one that best fits your requirement. However, borrowers must understand that instead of choosing the cheapest home loan, it is prudent to pick one with essential features (such as free additional repayments and redraws, an offset account, etc.) that will help them save more in the long run.
Seek expert advice
As a first home buyer, you might find yourself confused in a market flooded with jargon, self-professed experts and unsolicited information. Seek expert advice before making one of the biggest investments of your lifetime. Talk to a Coronis Mortgage Broker who will be able to help you put the right foot forward when it comes to getting into the property market.
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