Getting on the property ladder can be daunting as a first-time buyer, after all, a lot of money is at stake and your home is likely to be the single biggest purchase that you ever make. So if you think that you are ready to take the step then here are 4 things to consider.
- How much do you need to save for a deposit?
When thinking about getting on the property ladder as a first-time buying the number one thing that comes to mind is the deposit, and more importantly how much it is going to be and how you are going to save up for it. Deposits can be crippling for some budding homeowners, and the best thing to do is research low or no deposit options from companies such as https://no1propertyguide.com.au/. If a no or low deposit option isn’t going to work for you then don’t panic, plenty of first-time buyers manage to save up their deposit money through careful saving, moving back in with their parents for a short period or by asking for a family loan.
- Can you get a First Home Owner Grant to help?
The Australian government understands how hard it can be for first time buyers to get on the ladder which is why if you’re buying a house in Australia for the first time you may be eligible for the First Home Owner Grant. The grant is paid to you as the homeowner directly and can be used towards your deposit or other expenses. One thing to take into consideration is that every state tends to have different caps and rules, such as whether the property needs to be your primary home etc, so do read up on the grant terms and conditions specific to your area. - How much you can borrow for your mortgage?
The amount of money that you will be able to borrow for your mortgage will vary from lender to lender. In general, lenders use your salary to decide how much they are willing to give you and on average this works out at 5 times the joint salaries, pre-tax, for most couples. Some lenders may offer you more and some less depending on your financial situation, background and job security, so it’s best to get in touch to find the best deal. Remember to also check the interest rates that you will need to pay to each lender, one may offer to pay you more but with a higher interest rate which may not work out in your favour in the long run. - How much Stamp Duty do you need to pay?
Stamp Duty is the tax that you will need to pay on your property purchase and it can be a significant expense depending on the price of your property. Thankfully, once again, first-time buyers are often given discounts on the Stamp Duty, especially on lower-priced houses. In fact, when buying a $400,000 or less house you won’t need to pay any stamp duty at all in Sydney, Perth, Melbourne and Brisbane, so it may be worth rethinking where you buy too if that’s an option.
