It has been a screaming rocket ship ride for the property market here in Australia. For almost two decades land value steadily roared above expectations and in some areas, it soared into the stratosphere. To some it seemed that the Australian dream of home ownership was now out of reach.
Is it possible to enter the property market now in 2019 as a first-time buyer? With some careful planning, Yes! At the time of writing the fiery climb of property value has seemingly stalled. For now, at least values have stabilized or even dipped. Now might be a good time to enter the market.
A lending hand
An affordable and manageable way into home ownership is the ever-popular home loan. A plethora of financial institutions clamor for you patronage and offer home loans at supposedly low rates with fantastic features. Some deliver, and some do not. The best home loan providers, like Newcastle Permanent will not only give you great rates on a home loan but will assist you in planning. Lenders like Newcastle Permanent Building Society also offer great tools like home loan calculators and home loan repayment calculators to help you manage your finances. But be wary, some home loan calculators won’t give you the whole story.
Call of duty
When you purchase a property in Australia, whether it be a family home in Belconnen or a minimalist apartment in the heart of Chatswood, you will pay a ‘transfer’ fee. This taxation is most commonly known as stamp duty. The amount of stamp duty you will need to pay upon purchasing a property is dependent on its sale price. The duty must be paid within three months of purchase and it can really put in dint in your funds. For a home around $600000 the stamp duty will hover close to $20000. That’s a new kitchen. For a house closer to $800000 you will be paying over $30000. That’s a long a decadent holiday.
Luckily though, if you are first time home buyer you might be eligible for the ‘First Home Buyers Assistance scheme’… let’s just call it FHBAS from now on. FHBAS is available to any Australian resident over the age of 18 buying their first home. FBHAS aims to reduce the cost of home ownership for those yet to enter the market. You will have stamp duty reduced to zero if you are purchasing a property under $800000. Such a significant saving can ease the strain when buying your first home.
I’ll build a new one.
But wait, there’s more! If you are entering a contract to build your first home, you will be eligible for the First Homeowners Grant or FHOG for short. To qualify for FHOG you will need a building company that meets compliance, check with the Australian Governments Revenues website for more details. FHOG is a one of payment of $10000 to assist you building your first home, it is also designed to simulate the building sector and provides local building companies employment. Buying a new home can save you more than just money, but hassle and worry as your home will need little maintenance or major repairs for decades.
The average value of land has increased dramatically over the last two decades, but it doesn’t have to stop you from owning your first home. Whether you are buying your home or building it, there is government assistance available to you. Take advantage of this assistance and you could put a bundle of cash back into your pocket.