AUSSIE PROPERTY Q&A
Whether you’re moving to Australia and want a heads up before you arrive, or you’re here and want to get a few tips for your next property move, we’ve got you covered. I’m answering the questions that you had about Aussie property. DISCLAIMER – While we do our best to give accurate information, please always consult professionals rather than taking our word for it. Processes will vary between states. I always give answers based on personal experience, and from speaking with professionals.
WHAT WOULD YOU SAY IS A REALISTIC TIME FRAME OF BEING ABLE TO BUY A PROPERTY AS OPPOSED TO RENTING?
With rentals, you can secure them pretty quickly. In saying that, you will want to consider the current rental market, due to a shortage of rentals. I have some tips later on in this Q&A for securing a rental. When it comes to purchasing property, it will vary – you may need to secure a homeloan or foreign investor approval – that is what will take the time. If you don’t need either of those, then you can get a purchase through in as little as 28 days from having an offer accepted. If you need a homeloan, it’s likely that you will need at least 3 months proof of income.
WHAT SORT OF DEPOSIT DO BANKS/LENDERS REQUIRE WHEN BUYING A HOUSE?
This varies between lenders. Speak with a broker about what deposit you have and they will look for a lender to work with you. If your deposit is less than 20%, you will usually be required to get Lender’s Mortgage Insurance.
IS IT SIMPLE ENOUGH TO GET A MORTGAGE QUICKLY?
You will be required to provide proof of income for a period of time (usually 3 or 6 months), if your situation is straightforward then it can be relatively quick.
MOULD ON THE SUNSHINE COAST?
Last year we did have terrible mould problems on the Sunny Coast. We had to wash everything that was affected with a vinegar and water solution and then put it in the sun to dry. This is not something that we have ever experienced in our time here before or since. We did have terrible weather and flooding on the Sunny Coast last year, so it was unusual circumstances. You can use dehumidifiers and heating, as well as good ventilation as a preventative measure.
HOPING TO BE IN THE SUNSHINE COAST BY CHRISTMAS, ARE THE HOUSE DEPOSITS STILL AVAILABLE AT 10%?
We believe they are, you will need to speak with a broker though to discuss your options and which lenders would be best suited to you.
WHAT TYPE OF PROPERTY ARE YOU BUYING BACK NEAR THE COAST?
We are not sure yet, as we are keeping an open mind. We are not quite ready to be placing offers yet, but as soon as we are, we will assess what is on the market. In an ideal world, we will get a small acreage with a 4 or 5 bed house. It may be though that we find a house we prefer in an estate, so who knows.
CAN YOU BORROW MORE MONEY FOR A MORTGAGE IN AUSTRALIA THAN IN THE UK?
I’m honestly not sure, as we’ve not lived in the UK for quite a while now. The last time I spoke to a broker about this, you could borrow up to 6 times your annual income. This was also dependent on your outgoings, dependants and outstanding loans/credit cards etc. We are partnered with an incredible broker, who will be happy to speak with you – Becs Steinhardt.
WHEN MOVING OVER AND STARTING TO BUY FROM SCRATCH, WHERE WOULD WE GO FOR TOWELS, BEDDING, MOPS ETC?
If you’re kitting out a whole house, it can get expensive quickly! Have a look in Kmart, Target, Big W and Spotlight – they do some super stylish, affordable homewares. Adairs is my favourite for bedding (and dog shampoo!), they do some lovely things.
PROCESS OF GETTING A MORTGAGE? IS IT SIMILAR TO THE UK? DO YOU HAVE TO HAVE BEEN IN AUSTRALIA FOR X AMOUNT OF TIME?
The first thing to do is to get in touch with a mortgage broker, they will do a fact find with you, and then research which lenders will be the best fit for you. They can also give you tips to increase your borrowing capacity.
Then, once you’ve found a property that you wish to place an offer on, you can do so, inserting a subject to finance condition. Your broker will put your application in, while you keep your fingers crossed for good news!
You will need to have been in Australia for long enough to prove your income.
WHAT WOULD YOU SAY IS A STANDARD RENTAL PRICE FOR A 3 BED WALKING DISTANCE TO THE BEACH?
You can find rental prices for the areas that you’re interested in on realestate.com.au – Australia is huge, so price will very tremendously across the country.
SHOULD YOU HIRE A BUYER’S AGENT?
It’s not essential to hire a buyer’s agent, but there are some great pros to having one on your team!
-They don’t just search the properties that are on the market, they will be using their contacts to find properties off market too.
-They know what’s going on with the market, so will be able to stop you from overpaying. They will negotiate on your behalf.
-They have a relationship with local agents.
-They will do the research, and the hard work.
-They will ask the questions that you might not know to ask. They are professionals with experience of buying.
Many buyer’s agents also provide a service to secure a rental property on your behalf. This is a particularly interesting option at the moment while we face a rental shortage. You could use either a buyer’s agent or a relocation agent for this service. The benefit is that you will not need to worry about not being able to find accommodation, you will also save on paying for short term accommodation, such as hotels or airbnbs.
HOW MUCH DOES IT COST TO BUY IN AUSTRALIA, AND WHAT EXTRA COSTS DO I NEED TO CONSIDER WHEN BUYING?
-Have a look on realestate.com.au and Domain for property prices
-Conveyancer – the last time we purchased it cost us $1600, which included standard searches
-Stamp Duty, Mortgage Fee and Transfer Fee – These will vary depending on which state you’re in, the purchase price and other circumstances.
As an example, to buy an established home for $1mil, as a primary residence in QLD, you’d be looking at stamp duty of $30,850, a mortgage fee of $208.83 and a transfer fee of $3424.87.
You can use this calculator to work out your costs.
-Buyer’s agent fee (if you choose to use one)
-Building and pest inspection – we paid around $550 last time
-Lenders Mortgage Insurance if your homeloan deposit is less than 20%
-If you’re not a permanent resident or citizen, then there are additional fees. There is the Additional Foreign Aquirer Duty (which was 7% last time we heard), and also FIRB approval. Speak to your conveyancer about these.
-Don’t forget, you will need to put a deposit down when you have an offer accepted on a property. There is not a set amount, you can tell the agent how much deposit you wish to put down as part of your offer.
IS IT BETTER TO RENT OR BUY WITHIN THE FIRST 6 MONTHS TO A YEAR?
That’s entirely up to you. There is no right or wrong answer. We completed on our first Aussie property 5 months after arriving. It only took us so long because we were waiting for our house in the UK to complete! Ben and I have zero patience for waiting for anything, and so for us we wanted to jump in head first!
IS IT POSSIBLE TO BUY A HOUSE WITHIN 6 WEEKS OF ARRIVAL?
If you don’t need a mortgage or FIRB approval, then it may be possible. The conveyancers work quickly here, and it is not unusual (if the seller agrees) to complete on a house within 28 days.
