Important Things to Know when Buying Property in Australia

WORDS: PHOTOGRAPHY

With such a high number of factors to consider and such high prices across the country, purchasing property is among the most daunting and life-changing decisions you will ever make. Whether you are buying your first home or simply looking to expand your portfolio, property should never be purchased without extensive research and advanced preparation that help to ensure you’ve made the right decision. To that end, here are some of the most important things you should know before buying property in Australia:

Prices are constantly on the rise
Although property prices in Australia haven’t been particularly low in recent years, they only continue to rise. The prices have already grown over 10% all across Australia, with cities like Sydney and Brisbane even reaching a 25% increase. These statistics make budgeting more critical than ever.
A solid budget is the first and arguably most important step to buying property. Not only does it allow you to save some necessary money for purchasing property and paying down a deposit, but it might also help in paying off your debt, covering mortgage payments, and investing in other areas in the future. That is why it’s advised to build a good budget and savings strategy from the very beginning.

Costs of buying are even higher
The price of the home itself won’t be the only expense. You will likely have to pay a 10-20% deposit in order to secure a home loan and avoid Lender’s Mortgage Insurance (LMI). Lower deposit solutions are available, but they will usually come with higher mortgage insurance rates and a lot more legal obstacles to overcome as well.
Additional costs you will probably incur include stamp duty tax, finance and insurance costs, legal and conveyancing fees, as well as building and pest inspections. These expenses can set you back several thousands of dollars, which is why it’s recommended to expand your budget or set up a specific savings account solely for additional fees.

Property lawyers are crucial
Buying property is among the largest and most important transactions you will ever make. The quality of the advice you receive before the purchase can be the difference between a smart and a detrimental financial decision, especially considering the legal setbacks and hidden fees that often come with these transactions.
For that reason, consulting an experienced property lawyer from Sydney is always recommended. These experts are focused on providing quick and efficient service in Australia’s competitive market, while offering fixed-fee pricing for purchases regardless of the type of property, and ensuring you get the best possible outcome according to your wishes and needs.

Mortgages are quite useful
While having a deposit is quite important, you will still have to shop around in order to find the most suitable financing solution. Make sure to understand all crucial terms of the agreement before you sign, including the height and the type of the interest rate (fixed or variable), the term of the loan (often 25-30 years), how often the interest is calculated, if you are able to redraw funds, and whether and how you can make additional repayments.
In case you don’t have enough for a deposit, financing your purchase in full might also be an option. This is usually done by having a parent go guarantor or by using the renting history as proof of savings, but there are higher risks associated with this solution, and full insurance will also be a requirement.

Consulting real estate agents
Selecting the suburb and the type of property that fulfils your requirements can be difficult enough, but it becomes even more challenging when you have to find a suitable home at an affordable price. A good real estate agent can be quite helpful in this instance, providing you with more information about the property market, the area, and purchasing the right type of property.
Appointing a buyer’s agent might also be useful if you are buying at auction, but they could also help to find suitable properties, perform background checks, and negotiate with sellers. This might eliminate some common stresses as well.
Buying property tends to be a demanding and time-consuming process, especially if it’s your first time. But with good preparation and the right people by your side, purchasing property in Australia can be a much simpler and more successful endeavour.