Your 1st Australian Home
When you come to buy your own home in Australia you will find it different to buying a home in the England.
In Australia, well Western Australia (I have no experience of buying property in other States or Territories) when you put in an offer for the property you want to buy, the offer will form the contract if accepted by the seller.
This is a much better way to buy & sell property as you avoid all the stress and worry of things falling apart at the last minute.
YES when your house is sold it is generally sold.
There is no worry about the buyer changing their mind at the last minute.
Now because the offer will form the contract it is important that you include anything (conditions) that you purchasing the property relies upon. For example
- Subject to finance;
- Subject to a building inspection;
- Subject to a white ant inspection;
Subject to FRIB approval;
- Subject to the sale of your property;
The list of conditions is endless and it will depend on the circumstances which are relevant to you. I would recommend at the least you should have your offer conditions subject to finance, white ant, and a building inspection.
Even if you have a pre-approval from the bank DO NOT let the real estate agent put cash offer on the Offer & Agreement) the chances of having an issue with the finance are minimal, but why leave yourself open to unnecessary risk. Likewise if you need FIRB approval.
Another important thing to remember is ONLY put in an offer if you are serious about buying the property. In England you can put offers in on several properties at the same time but as I have already mentioned, in WA your offer once accepted forms the Contract. SO BEWARE or you could find yourself buying a house you didn't want, just because you didn't take time to understand the process.
OK so you have landed in Australia and looking to buy your first home, what can you expect?
HOW MUCH CAN YOU BORROW?
As a general guide times your income by four. This will vary hugely between lenders and will also depend on the serviceability factor (your ability to repay the home loan).
For this reason you will find using a
a big advantage, they will do all of the research for you thus saving you heaps of time.
A good broker will have access to a panel of around 30 lenders and 250n products. They will have software at their fingertips (updated daily) with all the latest loan options available from the lenders. A mortgage broker will be able to help you find the most suitable loan to suit your requirements. Many mortgage brokers are obligation free; they are paid a commission from the bank on settlement of your loan.
NEW HOME OR ESTABLISHED HOME?
In Australia when you buy a new home you generally purchase the land and then choose the home you would like to have built on it. You will find new homes on display in suburbs close to land sales.
As land has increased in price and peoples desire for smaller gardens (less maintenance), the standard block size has reduced in size.
The disadvantage of having your home built is that it is often in an area yet to be established, so you may not have many facilities such as schools, shops and hospitals close by. If you are lucky enough to find land in an established area then you will find that you will be paying a premium price for that piece of land.
A new home is a great way of getting what you want though and may be well worth the inconvenience of living close to a building site for a year or so.
Established homes cost more to purchase (you don't pay land transfer stamp duty on the construciton of a new property) than building and you don’t have all the inconvenience. Established property will be in suburbs that are more developed so access to transport, shops, schools, doctors etc… will be close by.
WISH LIST OF THE AREA YOU WANT TO LIVE IN
Before buying your home the first thing you will need to do is decide where you would like to live. Of course you will have various deciding factors on the location, some which will be more important to you than others. Factors such as:
- How big do you want the property to be?
- How much land do you want?
- What budget do you have to spend on your home?
- Do you want to be in the catchments area of good government funded schools?
- Do you want shops/dentist/doctors etc to be close by?
- Do you want to be close to where you will be working?
- Are you bothered about buying in an area, which has state (council) housing?
- Do you want to be close to Perth?
- Is public transport important?
- What about the freeway and main highways into Perth?
- Would you like to be close to the beach?
- DO you mind living close to the airport?
and so the list goes on………………
Armed with all the above information start making a wish list to first establish where will be and will not be suitable areas to live in.
If you want to be close to the beach then you can cross all the suburbs in the hills of your list for example.
RESEARCH PROPERTY PRICES
Once you have a short list of suburbs you like, you will need to do some research on property prices in the area (if you have not already done so).
This may of course limit the property you can afford, if you select a more expensive area then you may not have the budget to buy the kind of home you dreamed of. You may have to reach a compromise; perhaps the suburb next door is more affordable.
CHECK OUT THE SHORT LISTED SUBURBS
Go take a look at the short listed Suburbs, get in your car and take a drive round. There is no better way to get an idea of what a place is like than to go check it out. Pay attention to the types of property on the market, what the neighbouring properties are like and the surrounding roads.
Remember to do this at different times in the day too. In rush hour and night time a place could look very different.
We live in Woodvale and Trappers Drive on first sight looks a great location for your home with many of the properties overlooking the park.
People are happy to live on Trappers Drive but it is the main road running through Woodvale, linking Whitfords Avenue to Ocean Reef Road. It can be very busy. We preferred to sacrifice a view of the park in favour of living on a quieter road in the Suburb.
You will find that once you drive around looking at the suburbs you will start to get a feel of where you would like your home to be and where you definitely don’t want to live.
You need to reduce the number of suburbs on you list down to two or three.
WISH LIST OF THE HOME YOU WANT TO LIVE IN
Make a wish list of what you want your home to have and take this round with you when you view properties. Don’t loose site of what your dream home will be, even if you do have to compromise.
We compromised, we had a carport not a garage, we ended up with no raked ceilings and there is no swimming pool. The pool and garage doors on the carport we will have in time. The raked ceilings? Well you can’t always have everything. Woodvale was our chosen suburb and the property available that we could afford limited.