Buying your house

Below are 6 steps you can take to guide you through the house-buying process, to make it easier and less confusing!

1. Save up for your house deposit

It’s a good idea to make yourself a budget to find out how much you can afford to save, and forming a goal for your saving. A recommendation for this goal is to save around 20% of the average house prices you’re looking at.

Further information on saving for a house deposit

2. How much can you afford to borrow?

Considering your income, financial situation, house deposit amount, credit score/report, etc. find out how much you can realistically borrow. Given that mortgage interest rates are increasing, give some space to include the extra expense.

Check out this Mortgage calculator from moneysmart.gov.au!

3. Finding a good home loan

Contact multiple lenders, to get personalized home loans, and compare their rates. Remember, a small difference goes a long way.

You may also decide to get help from a mortgage broker to help you find the best loan options for you.

Getting a loan preapproval could also help you prepare for when you really do need to take the loan, so you’ll be eligible for it in the future.

4. Time to find a house!

Reflect on the reasons for buying a house, so you can come up with a list of what you need your house to have. You can then make a separate list for what would be ‘nice to have’ but not necessary.

The hardest part – yet one of the most important – is to make sure you stick to your price range, or you might end up in a tough financial situation.

Having patience to research, look around, and attend many inspections is key to finding the house that’s right for you.

5. Looking at properties

Getting help from professionals might be a good idea so you can check for pests in a house, or make sure you are making legally sound decisions.

Be prepared to pay a deposit immediately at an auction, or as stated in the contract of sale if it’s private.

Making an offer includes either an unconditional or conditional offer. Unconditional offers are simple, and you just pay. However, a conditional offer is a binding contract that only applies if certain conditions are met.

Once that’s all done, it’s time to finalize your loan!

6. Settling in

“You’re on the home stretch now, with a few more costs to take care of before you can move in.

Settlement

The settlement date is when the property title is transferred into your name, and your mortgage begins. The contract of sale sets out the settlement period, when you have to pay the full purchase price. Your solicitor or conveyancer will finalise the settlement with the lender and seller. Then you’ll get the keys to your new home.

Stamp duty

Stamp duty is a one-off state government property-transfer tax. You typically need to pay this within 30 days of settlement.

Find out how much you have to pay by using one of these calculators:

• Australian Capital Territory — Revenue Office: Conveyance duty calculator
• New South Wales — Revenue NSW: Calculator — for land and property transfers
• Northern Territory — Department of Treasury and Finance: Stamp duty calculators
• Queensland — Office of State Revenue: Transfer duty calculator
• South Australia — RevenueSA calculator: Stamp duty on conveyances
• Tasmania — State Revenue Office of Tasmania: Property transfer duty calculato
• Victoria — State Revenue Office: Land transfer (stamp) duty calculator
• Western Australia — Office of State Revenue: Calculators

If you’re a first home buyer, check if you’re exempt from stamp duty or entitled to a rebate or concession.

Home and contents insurance

Protect your home and contents against damage or loss. This may be a condition of your home loan. See home insurance.

Stay on track with your repayments

Finally, update your budget with your mortgage repayments, plus ongoing costs like council rates and land tax (when known). Extra expenses may take time to get used to, so keep an eye on your spending for a while.

See pay off your mortgage faster for tips on how to stay on track.”

 

All information above was collated and sourced from moneysmart.gov.au, that has much more detail and resources to access!