Buyin a house in Aus

niva*sis

hi all,

just wondering who here has bought a house in Aus?

I am not in a position to buy just yet but hopefully in the next year or two.

However, is there anything that I should take into consideration?

I have never had a loan here or anything like that so what is it that the banks etc will look at when giving out mortgages besides the obvious of salary etc.

Thanks.

mandrake04

I bought in Sydney 5 years ago and just sold my house about 3 months ago, currently living in my inlaws holiday home on Central Coast until the end of the summer and then buying back in the Hills again.

Rough guide is you need 20% otherwise you will be up for Mortgage insurance, as for loans rule of thumb is that they will lend you 3 to 3.5 your household income.

Not sure what the First Home Owner grant is still available (if you qualify), but my experience was $7000 and stamp duty exempt if under $500,000.

Not sure where you are looking for but at the moment in Sydney we are at the top of the cycle in prices, over the next year I expect a plateau and maybe a fall of between 2% -5% but if you are planning on living in the gaff for 5+ years this would not be a concern.

Also pick and choose where you live, think of future planning etc if you are smart you can pickup a diamond.

HillFarmer

mandrake04 wrote: »

I bought in Sydney 5 years ago and just sold my house about 3 months ago, currently living in my inlaws holiday home on Central Coast until the end of the summer and then buying back in the Hills again.

Rough guide is you need 20% otherwise you will be up for Mortgage insurance, as for loans rule of thumb is that they will lend you 3 to 3.5 your household income.

Not sure what the First Home Owner grant is still available (if you qualify), but my experience was $7000 and stamp duty exempt if under $500,000.

Not sure where you are looking for but at the moment in Sydney we are at the top of the cycle in prices, over the next year I expect a plateau and maybe a fall of between 2% -5% but if you are planning on living in the gaff for 5+ years this would not be a concern.

Also pick and choose where you live, think of future planning etc if you are smart you can pickup a diamond.

Fairly spot on. Although i think house prices can drop more than 5 to 10%.
All figures are showing more unemployment, taxes etc over the next few years. Iron ore down, i think we could defintely see a change.

Im looking aswell but see no value at the minute, Hills district also, absolutely love the area.

pete4130

I'm looking to buy right now. Lost about $1500 on small deposit after real estate claimed to have disclosed something but hadn't until the building and pest inspection was done.

Go through a broker, not through a bank. I got a much better interest rate and $1 LMI through ING (I think) as they are having a sale/promotion.

Most lenders capitalise the LMI into your home loan so you don't have to spend the money up front on the LMI.

No first time buyers grant anymore or stamp duty exemption unless its a new build/bought off the plans unfortunately.

The market is starting to plateau too. I was looking at central coast NSW for an investment place. Sydney is too expensive to live anywhere close to the city. Save your money and buy when/if prices drop if you can wait.

I've attached a spreadsheet which shows a repayments calculation I've done @ 4.59% (the rate we were getting through our broker) and the $1 LMI alongside the regular LMI cost. It's got different mortgage amounts on there and the initial outlay cost included. You might find it useful as a guide.

mandrake04

HillFarmer wrote: »

Fairly spot on. Although i think house prices can drop more than 5 to 10%.
All figures are showing more unemployment, taxes etc over the next few years. Iron ore down, i think we could defintely see a change.

Im looking aswell but see no value at the minute, Hills district also, absolutely love the area.

Yes I agree I meant 2-5% decline per year for a period of maybe 2-3 years and then a period of stagnation before the next increase this was Sydney I was talking about. There wont be a uniform drop across all areas, some suburbs will weather better than others but I cant see a huge pop but more of a slow deflation. There is still a huge shortage of houses in Sydney and even with some of the new land releases where it tends to be targeting overseas Asian Investors there is still shortages in areas where people really want to live and if they have the means (and a lot do) the will pay.

Also same can be said for factors across the country Sydney wouldn't be affected by Iron Prices than Perth would and NSW is currently in driving seat of the nation. I said years ago that I wouldn't buy a house in Perth if someone held a gun to my head, I still think its a bit of basket case waiting to happen but aside from Iron there still seems to other resources that should take some of the potential pain I think the boom in WA is largely over its just in that post boom wait and see.

I also agree there are few bargains in the Hills these days but plenty of value if you have the $$, if you look at CH and BH most blocks are 800-1000m this is where the value is, compare with newer suburbs of Kellyville Ridge and Rouse Hill where there are McMasions squeezed on 400m and you can p!ss on the back fence from your backdoor. The Hills is now a very sought after area, I took a punt 5 years ago and had friends asked me why and way out there this was before the SRT was actually announced, Hills area is now turning from an outlying village on the Sydney fringe to a satellite Business/Living hub stage 3 of Castle Towers is going start next year and will be the biggest shopping centre in NSW at 173,000m and my area was recently rezoned from R2 to R4 and it put an very easy $300K profit in my pocket, I sold to a greedy Asian on the speculation he might get the same out of it again (or maybe not) but I took mine and ran of to the Central Coast for the summer. I have a pretty good hand for buying as I will have near $500K deposit and only want to take $300K-$400K homeloan and I cant see much of a drop around the area, the prices now are likely what you will be paying.

catbear

http://www.macrobusiness.com.au/2014/12/the-history-of-australian-property-values-redux-2/

Interesting piece for consideration.

GladWrap

The $7000 First Home Owners Grant was stopped in October 2012.
You can only get a grant ($15,000) on a new home now in New South Wales.
The applicant must be a permanent resident or a citizen and not have owned any property at all anywhere before.

Banks will also consider tenant ledgers now whereas they didn't before.
So if you've rented for years and you have a good history then you can put that forward as evidence of good financial character.

And don't buy in Sydney. LOL.