Australian Home Down Payment
The first thing a lending institution will ask you when you go in for an Australian home loan is the amount of your down payment. Without a down payment you are at risk of being declined by a lot of banks. The economic situation always affects how much of a down payment banks like buyers to have in order to offer a loan. When the economy is poor, having a decent down payment amount shows a bank that you’re serious about buying a home.
Australian real estate experts recommend saving at least 5% of the purchase price for your down payment. However, a down payment of at least 10 to 20 percent helps you get a better interest rate and gives you favorable loan terms. Put simply the more down payment you have the benefit to you is the banks will work with you not against you. Banks like to feel secure with the person they are doing business with and if you can show that you can save then they know that your repayments will come on time all the time.
Creating a Budget
The first thing that will help you in saving for a down payment is a budget. This includes budgeting how and where you spend your money. Start by documenting exactly how much you need for essential bills such as current rent payments, food bills, utility bills, and any other necessary payments. Calculate how much you have left over and what percentage of that you can put away towards your down payment amount.
When creating a budget, one of the areas you need to eliminate is any sort of credit card debt. Banks look at the amount of debt you’re in to determine your loan and interest rate amount. The less debt you have when you apply for a loan, the better your chances of getting the loan you need.
Determining How Much You Need for a Down Payment
Once you start saving, the next step is to determine exactly how much you need. Online calculators are great at averaging out a monthly payment based on how much you put down. By using one of these calculators, you can determine how much house you can afford.
It may seem counterproductive to start saving before you have a total amount in mind, but as real estate prices change so may the amount you need. By setting aside a set amount each month, you can increase it if possible or determine how long you’ll need to save in order to meet your goal.
Although home buyers used to be able to offer as little as 5%, many banks are leery of lending money to anyone who offers less than 10%, especially first time home buyers. This means that most home buyers will need at least $20,000 in order to qualify for a loan and you’ll want to save closing costs as well. If you’re not sure how much house you can afford but want to start saving for your down payment, use the $20,000 benchmark as a starting goal.
This is bought to you to help you with ideas to buy your new home.
Thanks for reading and I look forward to hearing from you through comments below.
Regards
Richard Colum
Western Australia.
Tags: Australia down payment, australia real estate, saving for down payment
Photo: http://www.sxc.hu/profile/ninnjas
Cost to buy a home in Australia
If you’re looking to invest in a piece of Australian real estate, it’s important to know the costs associated with buying a house. Home buyers, especially younger first home buyers, may not realise all of the extra home loan costs. From taxes to duty fees, home buyers must cover fees from the lending agency and state or government fees.
Because Australia is broken up into different states, each has its own laws on Stamp duty payments along with councils that decide how real estate transactions is handled. Fees may vary with water, sewerage and shire council rates across Australia as well. But lenders tend to charge similar fees.
Lenders Home Loan Costs
Depending on the lender, it may work out slightly cheaper to go with one lender over another. However, most banks and lending agencies figure out a way to recoup costs one way or the other. Typical fees associated with applying for a home loan include the loan origination fee to set up the loan, the settlement fee, rate lock fee if you want to lock in your interest rate for 90 days, security guarantee fee if you list a guarantor on your loan, possible extra security fees and any required mortgage insurance.
Most of the above mentioned fees are included in the home loan amount. This means you aren’t required to pay this money up front, but it will add anywhere from $1,000 to $3,000 onto the total amount of your home loan.
Government Fees and Stamp Duty
Government fees include the registration of the mortgage and the cost assessed for transfer of the mortgage. The government will also collect the stamp duty levied against the mortgage and the price of the property. Land tax is assessed by the Revenue office and collected by the government.
Stamp duty is a general tax levied by Australia on certain documents. For real estate the stamp duty is typically levied on the total value of the real estate along with a set fee. For example, in Western Australia the duty rate in 2006 for a home valued between $100,001 and $250,000 was $2200 plus 4% of the value. You must factor in this added cost when budgeting to buy a home.
Miscellaneous Costs of an Australian Home Loan
Along with the required costs imposed by your lending institution and the governing body, there will be extra costs that may or may not be optional. Some of these costs include:
- Solicitor fees if you needed assistance buying your home
- Inspection report fees if you wanted to check for structural problems of the building
- Home insurance to insure the contents of your new home.
- Connection fees to have your lights, phone, and Internet turned on by the time you move into the residence.
- Council costs if you want or the council must inspect your property
All home buyers must remember to factor in all costs when budgeting to buy a home. An extra cushion of around $5,000 should help cover the majority of the costs associated with an Australian home sale.
Thanks for taking the time to read this weeks wrap up.
Regards Richard Colum
Western Australia.
Tags: home loan costs, Australia home loan, buy home in Australia
Sources
www.moneybuddy.com.au/home-loans/guide-stamp-duty.html
Photo: http://www.sxc.hu/profile/ninnjas
Tags: Australian home costs, australian real estate, government stamp duty, Stamp duty
photo: http://www.sxc.hu/photo/1265521
Buyers Are Protected
Investing in real estate can be a scary venture, especially if you’re making a real estate investment in another country. The old saying of buyer beware stands true even for the real estate market. Consumers must approach a real estate sale with a diligent effort and make sure both the real estate agent and seller are being honest.
Most Australian real estate professionals work diligently to create a favorable experience for buyers. However, the practice of over quoting and under quoting has led the Australian Competition and Consumer Commission (ACCC) to propose legislation that protects buyers and penalizes sellers who purposely mislead buyers.
Australian Consumer Protection
The ACCC’s main concern is a practice that many agents consider outdated, but one that still causes concern. This is the practice of over-quoting the selling price of a house to a seller to get the listing and then under quoting the price buyers make to make a sale. Australian consumer protection services, such as the ACCC, work to make sure that real estate agents and other businesses that depend on consumers do not engage in deceptive conduct.
The newer legislation being proposed holds both the real estate agent and the seller responsible for misleading buyers. A seller will only be held responsible if they knowingly go along with a deceptive scheme in order to gain more money on their house sale. If a seller is unaware of an agent’s scheme, then only the agent is held responsible. The ACCC hopes the proposed legislation will deter agents and sellers from acting unethically.
How Consumer Protection Works
Right now the consequence for misleading buyers is a fine. But consumer protection agencies will offer legal assistance to buyers who have been deliberately misled. Real estate buyers who experience deceptive conduct on behalf of an agent or seller can work with a consumer agency to handle the matter in court. The agency will work on your behalf to petition the court and handle the situation.
How to Avoid Being Misled
Any buyer who researches a seller’s real estate agent before making an offer should be able to determine if the agent has a good reputation. If the agent is using comparative market analysis to determine price, then chances are good he or she is an honest agent. You can also go over these analysis with your agent to determine if the prices offered by the agent compare to prices offered from other agencies. As long as you act diligently when purchasing property in Australia , you will have a favorable property buying experience. Also remember that real estate representatives are there to help people like you have a good experience in buying your investment. Real Estate representatives are the go between people that make this experience a good one. I do urge you to please do your dudilegence on representatives as well I think I can say this without saying any more you know what I mean.
I hope this has been a help to you please give me some feed back as to your experience with purchasing property.
Regards
Richard Colum
Western Australia.
Tags: Australian consumer protection, australian real estate, consumers, Investment, real estate agent
Australian Housing Shortage
As more people flock to Australia for retirement or to purchase second homes, the supply of new housing is short to meet the demand. Also increasing the need for new housing is the expected surge in Australia’s population. The main problem with the housing shortage is that house values will rise, as will interest rates. In 2008 and 2009, Australia saw its new dwellings decrease by 18 percent. If there are few setbacks, the Housing Industry Association forecasts a growth of new dwellings by 16 percent over the next few years.
Setbacks to Building New Australian Homes
Availability of existing buildable land is one problem developers are dealing with. While it’s a large land area, only a relatively small percentage of it allows for comfortable living. Many of the people wanting new Australian homes want to live in the coastal areas rather than the rugged terrain of the Australian desert.
Trying to find enough land to satisfy the residential desires of home buyers is a difficult task. The Australian dream is to own a nice-sized home with enough outdoor space to entertain. The lack of land not only decreases the number of homes but reduces the size.
Australia is also experiencing a lack of lending available to home builders. Developers have been able to get approval for new communities, but without the needed funding they have been unable to begin building. What home buyers are finding is that they qualify for home loans in the form of mortgages, but the housing they desire isn’t available.
How Can Australia Resolve Its Housing Crisis?
Developers are hoping that councils and state governments will decrease the amount of time it takes to get approved for land. The more land a builder can get approval for at one time, the more communities they can begin to plan and develop.
Lenders must also improve lending procedures to allow builders the money needed for development. Banks must start creating equal lending opportunities for both buyers and builders.
Conservative groups and politicians believe that the Australian housing shortage can also be conquered by reducing the tax incentives offered to families for each child they have. Hoping to reduce Australia’s population by reducing the average family size isn’t a proposal met with much excitement, but some see it as a viable option for helping to increase the number of dwellings available.
The reason new Australia homes are so important is that the availability of older homes is also scarce. Whenever a nation receives a vast increase in its population, the need for new homes rises. Many property owners, developers, and investors see all of this as a great opportunity for profit potential so are investing in Australia real estate wherever possible.
I hope you have enjoyed this information this week, it s good to know what is happening if you wish to move to Australia or perhaps you live here, investment in Australia housing has always been positive history has shown that investors have been very successful.
Let me know how you feel good luck and I look forward to next weeks column.
Regards
Richard Colum
Western Australia.
Tags: australia housing shortage, australia real estate, home buyers, new homes australia, retirement
Tips to research Property Data
Whether you’re looking to purchase a home for your personal residence or simply want to invest in Australian property, knowing how to perform a property search on homes and pieces of land is important. While a real estate agent and their representatives can give you advice and information on available pieces of real estate, having some background information on the general area can help you as well.
With real estate listings available online, even international buyers can find out about the current market with a quick search. Whether you’re looking for information about price or trying to find new real estate listings, an online search can give you answers if you know how to utilise it properly.
Buying Investment Property in Australia
Performing a property search for investment reasons is different than researching a residence. You must take into consideration the profitability of an investment property rather than just the look and location of the property. Newer Australian investment properties will be the most expensive, especially if they’re in a metropolitan area that’s seeing a lot of growth. When performing your property search, make sure you input your desired age of the property.
After you input the data necessary to pull up listings, go through each listing and note the price, location, square meters, age of property, and potential profit. Compare listings in the same location and then compare listings from different locations. If a certain area has higher property prices but promises more profit, consider investing a higher amount. After performing your own research, talk with an Australia estate agent and their reprsentatives to find out about listings that aren’t currently available to the public.
Buying Residential Property in Australia
The nice thing about researching residential properties is that you don’t have to consider its profitability. When researching residences you are still interested in looking at the price, location, size of property, and age of the property and comparing like pieces of real estate. However, you also need to take into consideration the amount of jobs available in the location, the condition of the local schools, and the demographics of the people living in that area.
Most online property searches allow you to plug in the state you want and then choose your desired suburb. The listings usually include photographs of the interiors and list areas of interest that surround the property.
Write down the selling agent and in particular the representative that works for the agent as they are most likely to know more about the property, and the listing number. If you’re already working with a particular agent, you can give them the information and let them know you want to inspect the property. By utilising property research tools online, you can narrow down the properties you want to inspect and expedite the buying process.
Thanks for dropping by I hope this information is of value to you and I look forward to your comments.
Regards
Richard Colum
Western Australia. Enjoying life to the max.
Tags: investment property in Australia, online property search, property search, residential property in Australia
Commercial Property Investing
Australia offers a plethora of commercial property investment opportunities. But why should you consider investing in commercial property rather than residential property? For starters, Australia is a popular place for people to relocate due to the climate and natural beauty of the countryside. Australia also has high tourist traffic each year, making commercial real estate a profitable investment.
While most real estate investors, especially those located overseas, consider residential property when making investments, the commercial property sector is rapidly growing. Investors can purchase retail spaces, office space, warehouses, or parking garages to turn a profit. To maximize your investment, you can even open a business within your commercial property space.
Australian Real Estate Market Changes
Before 2010, you may have been worried about the Australian real estate market crashing. Like the rest of the world, Australia suffered from falling real estate prices in both the residential and commercial sectors. Larger firms weren’t interested in purchasing smaller spaces, and individual buyers were holding out until the market turned around.
In 2010, employment began to stabilize and the smaller states began to see economic improvement. Part of that improvement included the lowering of real estate prices. As prices bottomed out, investors become more confident in commercial property investing in Australia. As confidence increases you will notice that competition for prime spaces also increases. This will help to inflate the currently low real estate prices, so investing now will help you lock in lower prices and increase your profits.
Australian Tourism and Commercial Real Estate
One of the top reasons Australia is a good place to invest is the number of travellers to the area. Many people go on holiday to Australia, and they usually desire places to shop, eat, and conduct business. People who rent their homes to tourists may have an increased need for storage so they can store furniture or other items when they’re not using their home. This makes investing in warehouse units, retail mall space, restaurant space, and office spaces a good investment.
Investing in Australian commercial property is a good idea for people who want to take advantage of tourists who have money to spend on retail and restaurant amenities. Leasing spaces to business owners is one of the more profitable investments, with office and retail space leading the way. Because of Australia’s close proximity to affluent Asian countries, more and more people are jumping at the chance to invest in Australian property.
With this wealth of information you surely could put your self in a position of owning a commercial property. One of the great advantages of having this investment is that all the outgoings are paid by the tenant of the day there fore your investment grows with capital gain without out any outlay. It is important that you find the right property with a very long lease attached to it.
Get in contact post some comments for to address.
Regards and have a great week.
Richard Colum
Western Australia. Taking the lead in communication.
Tags: Australian commercial property, Australian real estate market, commercial property investing in Australia, commercial real estate
photo: http://www.sxc.hu/profile/svilen001
Foreign Investors
Investing in Australian real estate can be a great foreign investment as long as you know and follow the real estate rules. Foreign investors must be approved in order to purchase residential real estate, vacant land, or commercial property in Australia. Even non-citizen family members of Australian citizens must seek approval before being able to buy any real estate.
There are some exemptions that allow you to purchase real estate without having to apply for approval. However, the Australian government recommends that any foreigners wishing to invest in Australian real estate consult with a real estate attorney before assuming that their purchase does not need approval. If you don’t already have one, your real estate agent can help.
Australia’s Foreign Investment Review Board
The review board is the governing body that reviews applications for real estate approval. If you wish to purchase residential real estate, commercial real estate, or vacant land, the Foreign Investment Review Board (FIRB) is the entity that helps approve or deny applications.
The board’s main goal is to ensure that homes continue to be built that can be occupied in the future by Australian citizens or people who relocate to the continent. With Australia’s growth boom there has been a slight housing shortage, especially in the more cosmopolitan areas. The board assists investors in complying with policies.
The Application Process
FIRB prefers that applicants submit electronic applications. Mail applications are accepted, but they do take considerably longer to arrive and process than applications done through email or fax. Depending on the type of real estate investment you’re making, there is a variety of forms you fill out. The board will want to see financial information, the address or location of the property being purchased, and any web addresses if purchasing as a business investment.
Exemptions
There is a variety of exemptions granted to Australian real estate investors. Some of the approval exemptions are:
- Australian citizens who live abroad don’t need approval to purchase property.
- You are purchasing Australian property from a developer who has already been pre-approved to sell to foreigners.
- You are purchasing government property.
- You are purchasing property as a joint tenant with your spouse who is an Australian citizen.
- You have a permanent resident visa and are purchasing only residential real estate.
Although you may think your real estate investment meets exemption needs, it’s important to ensure that your transaction is legally exempt before moving forward with your sale. It’s also important to remember that approvals are only good for one property. You must get approval for each piece of Australian real estate you wish to purchase. There is no general approval process that grants you permission to continuously purchase real estate.
Sales In Australia.
Sales in Australia as indicated in this link gives the investor a indication on what the market has been doing since 1986 up to 2009. All indications have been good for strong investment in the Australian Market. One of the main driving forces behind the Australian market is the mining industry. Australia has been going through a gradual increase with the export of different materials to all parts of the world. Australia has a vast quantity of Iron Ore and other precious metals that drives these property prices. Your views toward these comments would be appreciated.
Regards and have a most outstanding week.
Richard Colum
Western Australia watching out for a good buy for you. 
Tags: australian real estate, foreign investment, foreign investment review board, Investment, real estate investment
House Hunting tips
There’s no shortage of properties with great curb appeal in Australia. Australian real estate
buyers can have their pick of modest starter homes, grand executive homes, or coveted vacation properties. Whatever your heart desires (or your budget affords you), house hunting can be a lot of fun. But…make sure you can look past subtle curb appeal tricks so you really do get the house you’re expecting to get (for a reasonable price).
Home staging is done, in theory, to help prospective buyers envision living in that home from a decorating, cleanliness, and furniture placement perspective. But in some cases, things can be done to deceive you into thinking a home is worth more than it’s truly worth.
Home staging has become a profitable enterprise. A professional comes in and helps a homeowner prep a house for the best possible outcome prior to their open house event. Things are done and arranged in a way to appeal to people looking for a home and things are done in a way to help the homeowner get as high an offer as possible. There are known things that can reduce or increase a home’s appeal and perceived value and by playing on those aspects, a home staging expert knows which areas to target to make the home seem more welcoming, appealing, and valuable.
House Tips
When you look for a home to purchase, here are some house tips you’ll want to watch for and look past…in order to help you decide whether or not you really want the home and how much you’re willing to pay.
- Aroma. A home staging expert will probably tell homeowners not to cook fish for a week before an open house. The way a home smells has distinct impact on browsers. Baking smells sell. So do fresh aromas such as pine or lemon. But when you enter a home, be suspect of too overpowering an aroma to be sure the owner isn’t trying to mask a musky, damp smell. Always look for signs of water damage, regardless of scent.
- Cleanliness. A clean home is likely to fetch a much higher offer. The interior and exterior of a house are often polished to perfection in the hopes of getting a great offer. Don’t let tidiness cloud your judgment, though. Continue to look at the neighbourhood for average sales rates and look for flaws that cleanliness cannot hide.
- Fresh paint or wallpaper. Sure, a fresh coat of paint or a fresh layer of wallpaper spruces a place up but don’t let decor alone determine whether you want to offer asking price. Look closely at the condition of the walls. Often, wallpaper or textured finishes can be chosen to hide flaws and increase perceived value. A few hundred dollars in decorating supplies shouldn’t necessarily cost you $25K more. Look past the surface when determining value.
- Over staging. Some stager’s make a house look like a model home with rented furnishings that elevate the look and feel of the house. Don’t let it dazzle you. Instead, try to imagine your own things in the space and know your numbers in terms of value for the area and property type guide you.
Money Pit
Not every homeowner is trying to sell you a Money Pit but being able to see past little tricks designed to play on your desires can help you make a wise decision and see anything that should concern you enough to rethink your offer or that could alert you to putting a clause related to a defect in the agreement. Whether you’re looking for Melbourne real estate or a piece of property elsewhere, it’s a great idea to get as educated as possible before taking the plunge.
Regards
Richard Colum
Out there to help people in Real estate
Tags: australia real estate, curb appeal, house hunting tips, house tips, Melbourne real estate, money pit, Real Estate, Richard Colum
The interest rates goes up again for the home buyer and business operator, the tax goes up for the mining industry who support the work force what next Mr Rudd. I reckon you won’t be sitting in that sit for too much longer, you suppose to be there for the working man but those 
days seem to have gone. It looks like a bit of Robin Hood and his merry men steeling from the rich and giving back to the coffers for all the insulation stuff ups that they have caused. 
After watching a report last night on TV it appears that Australia is the country with the highest interest rate. Maybe because of that we managed to come out of the economic crisis better than any other Country, (May be).
At least when we were under a Liberal government they were able to keep us in a way better position financially than what you have managed to do Mr Rudd.
I wonder what it would have been like if the liberals had have won office in Australia at the last election and then faced up to the economic crisis, unfortunately that is all history now and we have to live with what we have got today. It does give me reason to wonder though. What about you ? Comments from outside the country are welcome too would love to hear from you
I mean to say here we are we had low interest rates for what 9 months, before they started going up again. Our reserve bank use’s the excuse that the cities around Australia have risen in price by 15% in the west to and up to around 25% in the east in the cities. I wonder where they got those figure from because in the country areas it is a much more different story.
Ask any real estate company in the country area and regional rural farming areas what they think, I can tell you that it is a complete different story. It seems that the people in the country have to wear the success of the property sales in the city areas by giving them an interest rate rise.
Any how you can see that I ‘m a bit upset by what is happening in Australia at the moment, I only hope that the reserve bank and Mr Rudd know what they are doing because it does not look to fair to me.
Sorry for loosing it here folks but this has got at me, Our young people and people on low incomes deserve a better go. I hope you understand where I’m coming from. Your comments and feed back would be greatly appreciated to help ease the mind in some way.
Regards
Richard Colum
Western Australia.
Have a great and outstanding day 
Tags: australia, home buyer, home buying, Property Investing, Real Estate, Richard Colum
photo credit: http://www.sxc.hu/profile/svilen001
We’ve discussed the current state of supply and demand for residential housing across Australia and now it seems there are some tentative signs that investors are coming through and beginning to fund new construction projects.
In February of 2010, the number of property investors applying for mortgage loans was at the highest level seen in the past two decades, according to the Australian Finance Group.
An increase in real estate prices combined with the shortage of supply is fuelling the interest in property investments. As well, the opportunity to achieve high yields through fully occupied rentals, both residential and commercial, is certainly a factor.
Conversely, first time homebuyer numbers are dropping. It is speculated that higher interest rates are to blame.
In another piece of good news, RAMS Home Loans has teamed up with Residex to provide additional information that should help property investors make more informed purchase decisions. The mortgage writer and real estate statistics provider are now making detailed reports available that include the median sales price, growth trends, median rent, and a current listing of available properties on the market.
This will certainly help realtors provide better service to their customers via informed advice, more accurate financing requirements, and a quick way to determine which locality will be best for a particular investment type.
One can surmise that investors will continue to drive the real estate market for some time to come. Additional supply is necessary and it is expected that property investors will lead the way toward providing it.
Have you been waiting to invest in Australian real estate hoping prices will decrease?
It may be time to rethink that strategy. Even if you do not have the necessary funding to invest in a large new construction project, consider an existing rental property, particularly in major urban areas where the need is great.
Regards
Richard Colum
Western Australia
Australia
