Getting the keys for your first home is an exciting time in anyone’s life, however it is often a less than simple process to get there! From the paperwork through to the various loan options to deciding on a variable or fixed interest rate, the first homebuyers market can be a daunting environment for a newcomer, however it doesn’t have to be. Save time and money by following these 5 MUST know tips to ensure that your first experience as a homeowner lives up to the great Aussie dream:
Tip #1 There is a $10k start waiting for you!
Yes, that’s right! As a first home buyer you may be able to take advantage of the Government’s First Home Owner Grant (FHOG) if you are building or purchasing a property that has never been lived in (turn-key property). This is a government initiative to assist people in buying their first home. Visit WA’s First Home Owner Grant website for details.
Tip #2 You could avoid stamp duty
Are you serious I hear you asking? Yes, absolutely! If you are eligible for the FHOG, you may also
be eligible for the first home owner concessional rate of stamp duty. Stamp duty is waived for vacant land up to $300k and for a turn-key property up to $430,000. Stamp duty is calculated at a reduced rate for vacant land up to $400,000 and turn-key to $530,000. Purchases exceeding these thresholds will attract standard residential stamp duty. If you were to purchase a $400k property, most buyers would be liable for $13,015 in stamp duty – that’s quite a saving for a first home buyer! Visit the WA Department of Finance for more details.
Tip #3 Engaging an Expert
Meeting with a trusted mortgage broker early on in your search is of great benefit. When your dream home does come up you are ready to secure the deal, maximising your savings on time and money. Most first home buyers are unsure where to start, getting excited to go out and look at property to see what is out there. You may find something and see someone at this point. Sometimes this works, but most of the time it doesn’t. With all the different bank policies out there, there could be one little issue that doesn’t get the deal done so then you need to move to bank b or c. The sooner you engage an expert, the easier it is to get the purchase or build done hassle free and with the best savings.
Tip #4 Get Pre-Approved, know all your costs!
It’s important in taking this exciting step that you think about your finances, know your budget and stick to it. There are many costs associated with buying a property to consider such as inspection reports, lenders mortgage insurance (LMI) and stamp duty to name a few. Getting a pre-approval for your finance puts you in a much more empowered position to take action. At this point you know what grants and/or concessions are available to you, you’ve engaged an expert to help you make informed decisions, and with their help you are well equipped to know your budget and get pre-approval on a loan that is best suited to your circumstances. Time to go shopping!
Tip #5 Stay on Target, stick to your budget
If you have followed tips 1 to 4, by this stage you are well equipped and ready to launch into the property market to secure your first dream home. Remember that this is meant to be a very happy experience, both throughout the search for your property and the duration of your loan. Stay on target and stick to your budget, no-one needs headaches or buyer’s remorse. Always make an offer that is within your purchase price. The right home that ticks all your boxes is out there for you.
The 1st home owners journey may seem daunting at first, however when you follow these simple tips you are guaranteed to save time and money and make the great Aussie Dream a reality before you know it.
Most importantly, enjoy the journey!