When setting out on the journey of purchasing your first home, it’s important to remind yourself (often) that this is not a quick, nor a simple process. It’s equal parts exciting, frustrating and demanding, but ultimately, it’s rewarding.
Working out how to finance the purchase of your first home is the most important part of the journey. But understanding deposits, mortgages, LVR, LMI etc. can all be a bit overwhelming. Don't worry, we can help you make sense of it all.
Read MoreAs a first home buyer, you may be eligible for either state or federal government assistance (maybe both). There's a number of different schemes so check out what's available by clicking below.
Read MoreThere are many reasons why buying off-the-plan may be a good option for you. Check out some of the benefits by clicking below.
Read MoreBuying a property isn't typically a quick process. You need to do plenty of research, visit display suites, talk to agents etc. Click below for a quick guide of what to do.
Read moreThere's a number of things you need to look into when buying an off-the-plan property, so here's a checklist of items that will help you cover everything.
Read MorePurchasing your first home should always be seen as a long term investment, so ensure you understand the fundamentals of buying property.
Read MoreDuring the course of your property buying journey, it's important to remind yourself that this is your decision. Lots of people will give you advice, or profess to know everything about property. Only you know your circumstances and where you want to live.
Read MoreGot more questions? We've covered off a few more items, so read on via the link below. Of course, if there's something we haven't covered, our sales agents will be able to help you with your query. So visit one of our display suites or make an enquiry.
Read MoreBefore purchasing a new home, you need to have a good understanding of your budget. How much you spend on your home obviously affects the deposit you will need, and how much you’ll need to borrow. It’s best to speak with a mortgage broker first who’ll give you an indication of your borrowing ‘power’, or the amount a bank is likely to lend, based on your income. Don’t have a mortgage broker? We can help introduce to you to one, so don’t stress.
It’s worth noting too, that any pre-approval you have from a lender will expire after 90 days, much less than a construction timeline, unless you’re purchasing close to when a building is being completed. After your purchase, and as you get closer to settlement, you’ll need to get pre-approval again, so as it’s valid for when you want to formalise your mortgage and settle.
It’s a complex process, and is one that needs due consideration. But if you’re also looking at your finances and are wondering how you’ll actually afford to buy a home, rest assured, today there’s a number of different ways to get you into your own home.
The ‘bank of mum and dad’, for example, is a very popular way in which young people especially are getting into the property market. What’s more, mum and dad don’t necessarily need a heap of cash in the bank to make it work. So long as they own their own home, they can help you buy. Of course conditions apply, so best to talk to your finance broker and of course, your parents first.
So don’t worry if the world of deposits, mortgages and banks bamboozles you – that’s what a finance broker is for. They don’t typically cost you, as the borrower, any money, so get a good broker (or ask us introduce you to one), and let them guide you through the process.
In Victoria, off-the-plan purchasers can make use of the first home buyer grant, which is $10,000 for metropolitan areas, for properties valued at less than $750,000. You will likely also be eligible for a stamp duty concession. The Federal government also provides assistance to first home buyers, however, such packages are typically limited, so your ability to secure this help does depend on when you intend to purchase a home.
There are a number of websites that provide an explanation of the various assistance packages that are available. We recommend that you always rely on government websites, as they are the most reliable.
Useful links:
– State Revenue Office of Victoria
– National Housing Finance Corporation
– First Home Super Saver Scheme
As a brand new home, not only is everything fresh and unused, you also get the benefit of a seven year building warranty. Purchasing an existing home can be risky, and there can often be hidden issues that you only discover when you move in, potentially costing you thousands.
Sustainable design and construction has come a long way in the last few years, and at a time when utility bills are becoming increasingly unaffordable, it’s wise to choose a home that has key sustainability features already built in. Double glazing and solar boosted electricity, amongst other things, will help ensure your home is thermally comfortable, without costing the earth.
When you purchase off-the-plan, you have a waiting period before you can move in, while construction of the project completes. The length of this time period will vary, subject to when you purchase in the lifecycle of the project, but it means that you have window whereby you can shop around for the best home loan. It takes the pressure off and ensures you have time to seek the best deal.
If you’ve ever bid at, or even attended an auction, you’ll likely agree that it’s a stressful event. At any time you can be outbid by another, robbing you of your dream home. Purchasing a home is an emotional process, and when you lose at auction, it’s incredibly deflating. But there’s no such issues when buying off-the-plan. You simply select the home that best suits your lifestyle and budget, and it’s yours. No competition, no stress.
When buying off-the-plan, in most cases you have the ability to customise your new home. With the opportunity to select a preferred interior colour scheme, and add upgrade options should you wish, you really can create a home that best suits you.
First, make a shortlist of the suburbs in which you want to live, then go and check them out. Visit local shopping strips, dine at cafes, assess the public transport options and work out the travel time to work. Don’t be afraid to look a little further afield than your preferred suburb. The next suburb may have a comparable product at a lesser price.
With your location shortlist complete, now it’s time to visit some project display suites and speak to agents. When your research is complete, compare as many different home options as you need to, to work out what you can afford, what’s the best value and what has the fewest compromises. Off-the-plan properties sometimes can include sales incentives too, so make sure you ask agents for the best deal.
The developer – Research the developer, their reputation and track record. Visit their completed projects and inspect the quality.
The architect – Who is the architect and are they experienced in residential design?
The builder – If a builder has been appointed to the project, research their track record. If not, buying from an experienced, reputable developer will ensure a quality builder is used.
The contract – Ensure the Contract of Sale is reviewed closely by a conveyancer to ensure it’s as it should be.
The floorplan – Make sure you understand the size of the property and its various spaces. Buy a scale ruler and check the dimensions carefully. Can you fit you existing furniture in it? Does it have enough storage for you? Ask for kitchen and bathroom elevations if you’re unsure.
Construction – Make sure you understand when construction is likely to commence, and how long the build will take.
Owners corporation fees – These are ongoing costs you’ll need to pay (quarterly) in both established and off-the-plan apartments. These fees cover maintenance of common areas, building insurance and other items that are the responsibility of all owners.
What might your plans for the property be in five or ten years’ time? Would it be a good rental property if you decide to move into a bigger place to raise a family later in life? Will it have good resale value if you sell the property down the track? If it’s an existing property, how old is the building and what maintenance costs might I be up for in the future?
Your friends, family, neighbours, work colleagues, and even some property conveyancers, will tell you what, when and where to buy.
But what’s important is that you filter out the ‘noise’ and make a decision that’s best for you. Only you know where you want to live and how it’s going to affect your work and commute, what your budget is, and what your plans are in the future. Take the time, do your research and, where you can, speak to people in the industry that are without bias.
When buying off-the-plan, the developer will typically ask for a deposit of 10% to secure your property and execute a contract of sale. Some developers will accept smaller deposits, but that does depend on the project. Your mortgage lender, however, may need you to contribute more deposit to secure your loan. It’s best to speak with a mortgage broker early in your buying journey so you know exactly what you can afford, and how much you’ll need saved to purchase a home.
Typically the 10% deposit payable to the developer is due when you sign the contract of sale. Some developers may accept a split deposit, such as 5% on signing and 5% later, but it does depend on the developer and project. If you need to contribute additional deposit to secure your mortgage, this is payable at settlement.
Your borrowing capacity is directly influenced by how much you earn, and potentially the earnings of your partner, if you’re intending to buy the property together. The amount you can borrow is also impacted by interest rates, as this has an effect on your ability to service the financial requirements of the loan. The amount you contribute as a deposit is also a factor. Again, it’s best to speak to a mortgage broker early to best understand how much a lender is willing to loan you. Mortgage calculators like the one below are also handy.
Mortgage CalculatorIt is your responsibility to ensure that you have sufficient deposit funds and valid mortgage pre-approval to ensure you can settle your property. However, we understand that there can be extenuating circumstances in some cases and MAB will always work with you to ensure the best result for both parties. Subject to the specifics of the contract and the situation of the purchaser, we may be able to provide a little extra time to arrange your finance, or perhaps assist with a nomination sale.
When purchasing a home (with MAB specifically), there’s generally two stages to the process. Once you’ve selected your home with the sales agent, it is secured with a small reservation deposit, while you review the contract of sale. At this time, you can exit at any stage and your reservation deposit is refunded in full. Stage two occurs when you have reviewed and agreed on the contract, and are ready to sign, thus committing to the purchase of the property. On signing of the contract, your 10% deposit is due. It is also at this time that your ‘cooling off’ period commences, which is valid for a period of three business days. Should you change your mind and wish to exit the contract during the cooling off period, your deposit will be refunded in full. However, if this period has expired, you are committed to the purchase unless alternative arrangements can be made, which is at the discretion of the developer.
The settlement process does depend on the type of property you purchased, i.e. an off-the-plan apartment, an existing apartment or a house and land package. But no matter what type home you purchase with MAB, there is a step-by-step process we guide you through to ensure you're always kept up to date and understand what's required for each stage of settlement.
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