Home Loan – Read Finance

Gold Coast Suburbs Ideal for First-Home Buyers in 2025

15/03/2025 Jesse Read

First-home buyers on the Gold Coast have unique opportunities thanks to government incentives in 2025. Queensland’s First Home Owner Grant has been doubled to $30,000 for new homes under $750,000 (contracts signed by 30 June 2025), and transfer duty is waived up to $700,000 with concessions up to $800k until the 1^st May 2025. Below, we compare three suburbs that combine affordability, growth potential, amenities, and lifestyle while fitting within these price caps and discuss their pros and cons for first-home buyers.

Pimpama (4209) – Fast-Growing Family Hub

Median House Price & Grant Eligibility

Average over the last 12 months: $825,000 houses, $670,000 Apartment/Unit. Pimpama offers many brand-new houses and land packages, and a good selection are priced under the $750k grant cap, allowing first-home buyers to take advantage of the $30k grant. (According to Domain, new homes in Pimpama can be found for around $620k–$650k, making them within both incentive caps.)

Growth Potential

Pimpama is one of Australia’s fastest-growing suburbs – its population soared from a few thousand to over 24,600 by 2021. In the last two years, house values jumped about 18–20%. Growth is fuelled by ongoing infrastructure investment: a new train station at Pimpama is scheduled to open in 2025 (improving Brisbane/Gold Coast commute times), and a $1.3B Coomera Hospital is under construction nearby (due by 2027) to serve the northern Gold Coast. These projects, plus future highway upgrades, point to solid long-term demand.

Amenities & Transport

This suburb is built for families. It has new schools (e.g. Pimpama State Secondary and nearby Coomera Anglican College), childcare centres, and the modern Pimpama Sports Hub with pools and parks. Everyday shopping is convenient with Pimpama City Shopping Centre, and larger retail/dining is 10 minutes away at Westfield Coomera. With Transport, Direct access to the M1 motorway makes driving to Brisbane or central Gold Coast straightforward. Until the local train station opens, residents use nearby Ormeau or Coomera stations for rail. Local bus services connect Pimpama with neighbouring areas.

Lifestyle Benefits

Pimpama delivers a suburban family lifestyle – think weekend sports, playgrounds, and BBQs. It’s not on the beach, but surf and sand are a 20–30 minute drive away. Meanwhile, some of the Gold Coast’s best theme parks (Dreamworld, Wet’n’Wild, Movie World) are just minutes from Pimpama, offering plenty of entertainment for kids and visitors. The suburb also enjoys semi-rural surrounds and is a short drive from the Tamborine Mountain hinterland for nature outings.

Risks & Challenges

Rapid growth has strained local infrastructure. Residents have raised concerns that roads, schools, and medical facilities are struggling to keep up with the housing boom, leading to congestion on exits and local streets. The government is responding (e.g. upgrading Yawalpah Road), but first-home buyers should be mindful of peak-hour traffic and plan for possible commuting delays. Another consideration is the high supply of new housing. While it keeps prices relatively affordable, it means you’ll be competing with investors in the entry-level market and may face more competition like in similar estates. Finally, being a newer outer suburb, Pimpama doesn’t offer the café/restaurant scene or nightlife of the coastal areas – you trade a bit of urban convenience for affordability.

Upper Coomera (4209) – Affordable Liveability and New Developments

Median House Price & Grant Eligibility

Around $800,000 for houses (units ~ $580k). Upper Coomera still sits below the Gold Coast median and on the cusp of grant limits. Many townhouses and some house-and-land packages fall under $750k, meaning first-home buyers here can use the First Home Owner Grant. The suburb has one of the best affordability-to-liveability ratios on the Coast, offering solid value for money. (Note: prices have been rising – late 2024 figures put the median house around $900k – so buyers should act promptly in 2025 to secure eligible properties.)*

Growth Potential

Upper Coomera is a thriving northern suburb benefiting from both Gold Coast and Brisbane growth. It saw about a 10% rise in values in 2023 and continues to attract new residents. The area is popular with commuters – it’s close to the M1 and a short drive to Coomera or Helensvale train stations – and demand for “affordable” homes in convenient locations remains high. The city plans limited new land releases, so recent development areas like Upper Coomera will continue to see upward price pressure until supply tapers. Major investments nearby such as the Coomera Town Centre, Costco at Coomera, and the planned Coomera Hospital also bode well for capital growth and local jobs.

Amenities & Transport

Upper Coomera is very family-friendly and well serviced. There are multiple schools (both public and private) including highly regarded Coomera Anglican College in the area. You’ll find supermarkets, cafes, and specialty stores at the local shopping centres, and larger malls (Westfield Coomera, Helensvale Plaza) within 5–10 minutes drive. Being near the Coomera transport hub means residents have relatively quick access to trains and the G:Link light rail extension at Helensvale. For drivers, the suburb has two convenient M1 interchanges (Exit 54/49) for north or south travel.

Lifestyle Benefits

Upper Coomera strikes a nice balance between city and suburban life. It’s close to entertainment – the big theme parks are just down the road – and about 20 minutes from major shopping/dining precincts in Southport or Surfers Paradise. The suburb itself has plenty of green space and parks for outdoor activities, and it’s near the Coomera River for boating or fishing enthusiasts. Being on the northern edge, it’s also closer to Brisbane (roughly 45–50 minutes) which is a plus for dual-city commuters. Residents describe Upper Coomera as having a safe, community vibe, with sports clubs and community events bringing people together.

Risks & Challenges

As an outer suburb, Upper Coomera shares some challenges with other growth areas. Traffic can be heavy at times (especially around the M1 on-ramps during rush hour), so commute times can be unpredictable. Most properties are modern builds which is great for low maintenance, but buyers should still inspect quality as some mass-built homes may have minor construction issues. Because the area is in high demand by young families, entry-level stock (e.g. new townhouses) might see competitive offers, and prices could edge up beyond first-home budgets. Lastly, while not “far,” it is inland from the beach – about a 25-minute drive – so beach-lovers will be trading immediate coastal living for affordability. Overall, however, Upper Coomera’s challenges are manageable and outweighed by its accessibility and value for money for first-home buyers.

Nerang (4211) – Affordable Inland Suburb with Lifestyle Appeal

Median House Price & Grant Eligibility

Roughly $800,000 to $900,000 houses; units ~$526k. Nerang’s median sits below the Gold Coast average, reflecting its inland location. While most existing houses won’t qualify for the new-home grant (they’re established), there are some new townhouse complexes and unit developments in Nerang priced under $750k that first-home buyers could target for the $30k FHOG. Importantly, Queensland’s transfer duty concession up to $700k can make purchasing an older house in Nerang more achievable for first-timers. Compared to flashier coastal suburbs, Nerang still offers relative bargains – one reason it was named a top suburb for affordability and liveability in 2023.

Growth Potential

Nerang is an established market that is now seeing a renaissance. In 2023, house values jumped ~11% as more families and investors “discovered” the suburb. PRD researchers ranked Nerang among the top 3 Gold Coast suburbs for combining affordability with future growth. Drivers of growth include its central location, improved shopping amenities, and spillover demand from pricier coastal areas. Being inland, Nerang has a bit more room for development – there are still pockets of land and older homes ripe for renovation, which invites new buyers and investors. Market trends show steady demand: the area’s relatively lower price point is attracting young families seeking houses (as opposed to units) they can afford, as well as some investors capitalizing on strong rental yields. With the Gold Coast Light Rail not yet reaching this far inland, future transport projects (if proposed) could further boost values.

Amenities & Public Transport

As the unofficial “gateway” to the Gold Coast hinterland, Nerang is strategically located. It has its own train station (on the Brisbane-Gold Coast line) and sits just off the M1, giving residents easy access north and south. Day-to-day needs are met by several shopping centres (including Nerang Fair and local supermarkets) and a variety of restaurants, cafes, and services in the town centre. There are numerous schools in and around Nerang, from primary to high school, making it convenient for families. For public transport within the Coast, buses from Nerang run to key spots like Southport and Broadbeach; and by car you can reach Robina Town Centre, Pacific Fair, or Surfers Paradise in 15–20 minutes. Nerang also hosts the city’s council chambers and other civic facilities. While not as bustling as coastal hubs, it has all essential amenities within close reach.

Lifestyle & Environment

One of Nerang’s biggest draws is its lifestyle balance. The suburb hugs the Nerang River, and many homes enjoy waterfront aspects or leafy surroundings. It’s at the doorstep of the Gold Coast hinterland – weekends can be spent hiking or picnicking in Nerang National Park and the green hills beyond. At the same time, Nerang offers urban conveniences: trendy cafes, craft breweries, and live music venues have been popping up, giving the area a budding social scene. For sports lovers, Nerang has golf courses, an equestrian centre, and is close to Metricon Stadium (for AFL games and events in neighbouring Carrara). Beach outings are a 20-minute drive east, which is a reasonable trade-off for the quieter, more nature-centric setting Nerang provides. This mix of outdoor recreation and improving urban amenities makes it popular with both families and active retirees, as well as anyone who prefers a calmer environment over the tourist centres.

Risks & Challenges

As an older suburb, Nerang’s housing stock includes many homes from the 1970s-80s. First-home buyers should budget for potential renovations or updates (the upside being the chance to add value). The area’s inland location means you won’t get ocean breezes; summer heat can feel stronger, and you’re not walking distance to the beach (which some may view as a drawback). In the past, parts of Nerang had a reputation for slightly higher crime or lower socio-economic status compared to coastal suburbs, but this is changing as new families move in. Flood risk is limited to low-lying spots along the river – most residential areas are well zoned, but checking flood maps is a good precaution. Finally, while Nerang is well connected by train and road, it currently misses out on the Gold Coast’s light rail network and the buzz that comes with it. This means public transport within the suburb is mostly bus-based, and if you work in, say, Broadbeach or Southport, you’ll likely be driving or have a multi-step commute. Despite these challenges, Nerang’s value for money and lifestyle are strong drawcards for first-home buyers who might be priced out elsewhere.

Key Takeaways for First-Home Buyers in 2025

Align Budget with Grants

Leverage the Queensland First Home Owner Grant (now $30k) by targeting new builds under $750,000 – for example, new estates in Pimpama or Upper Coomera often have house-and-land packages in this range. Also aim to stay under $700,000 if possible if you are attempting to avoid transfer duty until the update made on the 1st May 2025. This can significantly reduce upfront costs and boost your starting equity. If your chosen suburb’s median house price is above these caps (e.g. Nerang’s ~$800k), consider townhouses or units, or older houses that you can renovate over time.

Growth Potential vs. Price Now

Each suburb offers growth potential, but for different reasons. Northern corridor suburbs (Pimpama/Upper Coomera/Ormeau) are experiencing rapid population growth and heavy infrastructure investment, translating to strong recent price gains (15–20% over two years). Buying here means you’re may see continued capital growth as new facilities (stations, schools, shops) come online, but it also means getting in quickly before prices climb out of first-home range. More established areas like Nerang may offer a steadier climb; they might not spike as dramatically, but their growth is now accelerating as affordability draws in new buyers. Decide if you want to “ride the wave” in a booming estate or opt for a slightly pricier suburb with proven long-term appeal.

Lifestyle and Commute Trade-offs

Be realistic about the lifestyle you want versus what you can afford. Suburbs further from the beach or CBD tend to be cheaper – you’ll get more house for your money in inland or northern areas, often with larger yards and family amenities. For instance, Pimpama and Upper Coomera provide modern family living, theme parks, and new shopping centres, but you’ll be driving to the beach and may face highway traffic. Closer-in suburbs like Nerang or Southport shorten the trip to employment hubs, universities, and beaches, and offer established dining and entertainment options, but generally at higher price points. First-home buyers should choose a suburb that fits their daily needs – if you work in Brisbane, living near the M1 in the north might be ideal, whereas if you crave weekends surfing or nightlife, a central location could be worth the extra cost.

Amenities & Future Infrastructure

Research what’s already there and what’s coming soon. A suburb with current essential amenities (schools, supermarkets, public transport) will make life as a new homeowner much easier. All three suburbs above have good basics e.g. schools and local shops but differ in extras. Upper Coomera has quick access to major retail and upcoming health facilities, Pimpama is getting a new train station, and Nerang has a train station plus established civic centres. Keep an eye on council plans and state infrastructure projects like the Light Rail expansion or highway upgrades. Buying in the path of future infrastructure can boost your property’s value and convenience over time.

Risks to Consider: Don’t stretch beyond comfort

Rising interest rates and inflation mean you should leave a buffer in your budget. In fast-growing estates (e.g. Pimpama), be prepared for growing pains like traffic congestion or construction activity as the area develops. In older suburbs (Nerang, Southport), factor in maintenance or renovation costs for aging properties. Also, consider resale appeal while it’s your first home, it likely won’t be your last. Think about what future buyers or tenants might look for (proximity to transport, low crime, good schools, etc.). Diversify your research: check flood maps, crime stats, and talk to locals if possible. Each of these suburbs has strong upsides for first-home buyers, but each also has quirks that need due diligence

Bottom Line

The Gold Coast in 2025 remains a promising arena for first-home buyers, as long as you balance affordability with lifestyle. Thanks to government incentives and the city’s growth, suburbs like Pimpama, Upper Coomera, and Nerang allow newbies to enter the market with a solid chance of capital growth. Focus on finding a property that meets the grant criteria, fits your lifestyle priorities, and has growth signals (infrastructure, population trends) in its favour. With careful planning, your first home on the Coast can both save you money now and build your wealth for the future.

Strategy

Deposit Bond Basics Explained

18/09/2023 Jesse Read

Deposit Bonds are a tool used when purchasing a property that allows a buyer to guarantee to a vendor that the purchaser will pay the deposit at settlement. Deposit Bonds act as the guarantee, and are also may be known as a deposit guarantee.

These have helped people purchase property when they don’t have access to the required funds in their account ready for a deposit right away. Read on to see if this is a solution that could help you.

Who can use a Deposit Bond:

First Home Buyers
Property Investors
Next Home Buyers (Upsizing or Downsizing)
Off-the-plan Purchases
Home and Land Package Purchases
Commercial Property Buyers
Self-Managed Super Funds

Common Reasons to Use a Deposit Bond

Hot having the required funds available when you want to purchase a property can be a hassle especially if you know you have the funds in your home equity, a term deposit, or other investments. They may also be a more financially viable product if comparing them to a personal loan.

The solution on what a deposit bond may help with includes:

Deposit stuck in another property: If your funds are tied up in your current, or an investment property.

Auction: When attempting to buy a property at auction, a cash deposit could be an alternative solution to keeping cash.

Problems with Deposit Bonds

Deposit Bonds are not perfect though. Bond providers can have various products with different fees. Developers, Real Estate Agents, and Vendors also do not need to accept your deposit bond, which is why you should check before getting one.

One reason why a real estate agent won’t accept a deposit bond is due to the fact that they may receive their commission from the deposit. Since a deposit bond is not cash, the agent may have to wait until settlement to be paid their commission instead.

Vendors may also refuse the deposit bond as they may be relying on the funds themselves for various different reasons including as a deposit themselves.

Deposit bonds aren’t something to be used as genuine savings or a deposit to secure funding from a bank or lender. They also can only cover up to 10% of the deposit until settlement.

What to do if you want a Deposit Bond

Reach out to us at Read Finance for a complimentary assessment where we can go over your financial situation, goals and if a deposit bond can help you when purchasing a property.

Pre-Approval vs Pre-Qualified Home Loans

Guides

Pre-Approved vs Pre-Qualified – Home Loan Terms Explained

04/09/2023 Jesse Read

Some clients of mine have been using these terms interchangeably, not realising that both pre-approved and pre-qualified are two completely different terms when getting a home loan. Knowing the difference between the two is vital so you aren’t disappointed later on, and know the terms equips you with the right information.

If you have a pre-approved home loan it means that the lender has checked the information you have submitted and provided a figure they believe they may lend you, while a pre-qualified home loan provides you a figure the bank estimates it may lend to you without having verified your information.

It is important to note that neither of these guarantees that the lender will write the home loan. Your circumstances or the lender’s product could change from the time you received the information and the time you apply for the loan.

Pre-Approved

Getting a pre-approval requires a lot of the same steps as applying for a loan, getting the lender to assess your situation to provide an amount that they may lend you.

Information provided to the lender includes:

Income
Assets
Liabilities

Pre-approval comes with more weight than a pre-qualified loan due to the verified information. Though this still can be affected by property valuations, changes in circumstances and property types. A good example would be if someone applying for a loan lost their income source or job.

Pre-Approval Process

The process to obtain a pre-approved home loan is as follows:

Meet with your mortgage broker
At Read Finance we would first have a complimentary meeting to find out what you are after and to see what your financial goals are. Here we can provide you with documentation and answer any questions you may have. We will stay in touch with you through this process and after.
Documentation Request
You will need to provide the information and documentation that we request to fulfil the lender’s requirements and our compliance.
Conditional Pre-approval
Also known solely as a pre-approval, it will have requirements and conditions listed needed for them to provide the home loan to you.
Search for a Home
You now have an idea of how much the bank is willing to lend you as well as the conditions and additional requirements that you need to fill. Use this information while searching for your new property.

Common Conditions for a Pre-Approval

The conditions that a lender could give you varies for each person due to different lender product and current lender requirements. but here are some common conditions you may be provided with.

No changes in your financial position.
Verification on details you have provided.
A valuation of the property that satisfied the lender.

These will be provided to you so you will be well aware of what they are.

Pre-Qualified

Getting pre-qualified will provide you with an estimate of how much you might be able to borrow from a lender. This is done without verifying your financial information and in turn, means that you have not applied for a loan.

Get Help

Getting professional help for one of the largest purchases in your life is important. Reach out to us at Read Finance and let us help guide you through the process.

Book a complimentary meeting where we can assess your situation and talk about whether you’re interested in a pre-assessed or pre-qualified home loan.

Guides

How to Avoid Paying Lenders Mortgage Insurance (LMI) in Australia

28/08/2023 Jesse Read

Lenders Mortgage Insurance (LMI) is a one-time, non-refundable fee that borrowers in Australia might have to pay when acquiring property. It serves as a safety net for the lender in case the borrower defaults on the mortgage.

For many prospective homeowners, LMI can add a significant cost to the home buying process. In this article, we’ll explore strategies to avoid paying LMI in Australia.

Understanding LMI

Before diving into how to avoid LMI, it’s vital to understand what it is and when it’s applied. Generally, if you’re borrowing more than 80% of the property’s value the lender may require LMI to offset the risk. Each lender has different products with varying terms that may affect if you need to pay LMI. I will go over these in more detail below.

Often clients of mine and the general public have been confused about which party this insurance protects. It only protects the lender in the case someone defaults on their repayments but is paid commonly by the borrower.

Save for a Larger Deposit

The most straightforward way to avoid LMI is by saving a deposit of at least 20% of the property’s purchase price. Saving for this amount of deposit is challenging for some, which is why budgeting is important.

Tips for Saving:

Budgeting: Outline your monthly expenses and identify areas where you can cut back. Doing it once provides you with a great overview of your previous spending, while continuously keeping track can help you maintain the saving goals set.
High-Interest Savings Account: Utilize an account that provides good interest on your savings. When putting away saved money for specific periods of time, these are seen commonly as low-risk investments.
Government Schemes: Schemes available for first time homeowners like the First Home Super Saver Scheme (FHSS). Check with your mortgage broker to see what government schemes and grants may be available to you.

Consider Family Guarantees

Some lenders allow immediate family members (usually parents) to use their property as security for your loan. This method can sometimes eliminate the need for LMI, as the lender has additional collateral.

Things to Consider:

Legal Advice: Both parties should seek legal advice to understand the responsibilities and potential risks involved.
Relationship Dynamics: Be clear about expectations and responsibilities to prevent future misunderstandings or disputes.

Explore Professional Packages

Certain professionals like doctors, lawyers, and accountants may be eligible for LMI waivers or discounts due to their generally stable and high-income employment. Each lender has different criteria, so it’s worth investigating if your profession qualifies.

Negotiate with the Lender

In some cases, lenders may be willing to waive or reduce LMI if you present a strong case, such as:

Stable Employment: Proof of a stable income and job security.
Good Credit History: A clean record of managing debts responsibly.
Other Assets: Having other assets might reduce the lender’s perceived risk.
Promotions: The lender may have a promotion running changing the requirement for LMI.

Opt for a Smaller Loan

Consider properties within your budget that would enable you to borrow at or less than 80% of the property’s value. While this might limit your options, it ensures that you won’t be subject to LMI.

Viewing properties at different price tags will give you a good idea of the difference in what getting a smaller loan could do for you. Not only could you find the property that you love, but you may be paying less due to the overall size of the loan or the interest rate.

Use a Mortgage Broker

A mortgage broker can help you navigate the complexity of different loan products and assist you in finding a lender’s product that suits your needs. This could save you time and stress knowing that you’re being looked after.

Contact us at Read Finance for a complimentary meeting to see how we can help you with your property finance.

Conclusion

Avoiding LMI in Australia could require careful planning, financial discipline, and a thorough understanding of the options available. By saving a larger deposit, considering family guarantees, exploring professional packages, negotiating with lenders, opting for a smaller loan, or using a mortgage broker, you can strategically reduce or eliminate the cost of LMI.

By following these principles and seeking professional guidance, the path to homeownership in Australia could become more affordable and within reach, without the burden of Lenders Mortgage Insurance.

First Home Buyers

9 Tips for First Home Buyers Looking at Properties

21/08/2023 Jesse Read

Buying a home is a monumental decision, marking not only a significant financial investment but also a commitment to a new chapter in one’s life. For first-time homebuyers, the process can be both thrilling and daunting, filled with dreams of the perfect dwelling and the complex realities of the housing market.

The path to homeownership involves numerous considerations, ranging from understanding what can be changed about a property to meticulously evaluating the exterior, sniffing out potential problems, considering maintenance responsibilities, and wisely navigating negotiations and professional collaborations.

This comprehensive guide is designed to assist first-time homebuyers in navigating these multifaceted considerations. Whether you’re just starting your home search or are about to make an offer, these tips will help you approach the process with foresight and clarity.

1. Know What Can Be Changed

Image looking over Pacific Pines, Queensland, Australia. — The suburb of Pacific Pines, Queensland, Australia

Understanding Property Limitations: Assess what elements of the property are permanent and what can be renovated or modified. Evaluate how these limitations align with your long-term goals and lifestyle needs.
Location Evaluation: Since location is usually unchangeable, thoroughly explore the neighbourhood and potential neighbours before submitting an offer. Investigate local amenities, safety, and community culture.
Zoning Regulations: Make sure you understand local zoning laws and restrictions that may affect future changes to the property. Consult with local authorities or a real estate lawyer to clarify potential legal barriers.

2. Review the Exterior

Exploring Surroundings: Pay attention to your potential home’s surroundings, considering neighbouring properties, proximity to parks, shopping centres, and noise levels. Check for future development plans that might affect the area.
Checking Privacy: Determine if neighbouring properties overlook crucial areas like your garden or bedroom. Consider planting trees or building fences to enhance privacy if needed.
Assessing Traffic and Noise: Consider the property’s location relative to busy roads and noise pollution at different times of the day. Visit at various times to get an accurate sense of noise levels.

3. Sniffing Out Potential Issues

Detecting Odors: Be vigilant about strong smells that may signal problems like mould or mildew, which could lead to significant expenses. A professional inspection may be required to ensure no hidden issues.
Beware of Masking Scents: Air fresheners, baked goods, fresh paint and even candles may be used to disguise unpleasant odours. When looking at a property keep these things in mind. They also may be used as a sales tactic to entice you into having a favourable view of the property.

4. Identifying DIY Repairs

Spotting Amateur Work: Look for rushed or incomplete repairs, including messy plumbing, carpentry, electrical work, and other incomplete projects. Consider hiring a professional inspector to assess the quality of work.
Inspecting for Damages: Pay attention to leaky taps, missing tiles or flooring, and other signs of poor maintenance. These may indicate a lack of care in other unseen areas of the home.

5. Considering Garden Maintenance

Evaluating Garden Size: While a large garden might seem appealing, consider the amount of work required to maintain it if you’re not accustomed to gardening. Don’t forget about the amount of mowing, whipper snipping, and poising required too on large blocks of land.

6. Taking a Deliberate Approach

Avoiding Sales Pressure: Real estate agents may pressure you into making a quick decision; take your time to research and feel comfortable with your choice. Have a clear understanding of your priorities to avoid impulsive decisions.
Negotiating Wisely: Remember the importance of this purchase and don’t be afraid to negotiate or walk away from a bad deal. A patient approach may lead to better terms and a more suitable property.

7. Seeking Second Opinions

Getting Objective Views: Invite a family member or friend to an open home as they may spot potential problems that you may overlook due to emotional investment. Their unbiased perspective can provide valuable insights.
Hiring Professionals: Consider hiring a professional home inspector to identify any hidden problems. An expert’s evaluation helps to ensure that you’re making a well-informed decision.

8. Collaborating with Professionals

Work with a Mortgage Broker: Find the right mortgage to work with like Read Finance. A broker’s expertise can help you find a mortgage tailored to your financial situation from a vast amount of lenders.
Engaging a Real Estate Agent: Find a reputable agent to help navigate the process, and possibly an attorney to handle legal aspects. Their experience can streamline the process and mitigate potential legal challenges.

9. Keep your Emotions

Using Logic over Emotion: Keep emotions in check and approach the buying process with a logical, analytical mindset. Avoid letting emotional attachment to a property override critical thinking.
Setting a Realistic Budget: Be mindful of your financial limitations and ensure that your purchase aligns with your long-term financial goals.

Conclusion

Buying your first home is an exciting yet complex process that requires careful planning and consideration of many factors. From understanding the property’s limitations to scrutinizing the exterior, detecting hidden issues, considering garden maintenance, and seeking professional help, these comprehensive guidelines can assist first-time homebuyers in making an informed and confident purchase decision.

Collaborating with real estate professionals like agents and mortgage brokers can further ease the process, ensuring that the first-time homebuyer achieves a satisfying and successful homeownership experience that aligns with their lifestyle, preferences and financial capabilities. By taking a deliberate approach and focusing on both tangible and intangible aspects, first-time homebuyers can turn their dream of owning a home into a rewarding reality.

First Home Buyers

10 Things Every Australian First Home Buyer Should Know

14/08/2023 Jesse Read

As a proud Australian and a homeowner, I know firsthand that navigating the property market for the first time can be overwhelming, even daunting. You’re not just buying a house but you’re investing in your future, and that’s a huge step! The process can seem complex, full of unfamiliar terms and hidden expenses. However, becoming well-versed in the fundamentals of buying a home can take much of the anxiety out of the process.

As someone who has been in your shoes, I’ve put together a list of 10 key things that every Australian first home buyer should know. This is the knowledge I wish I had had at my fingertips when I was embarking on my own home-owning journey.

1. Get a Mortgage Broker

Mortgage brokers may be incredibly helpful for first home buyers, and I am not just saying that because we are a Mortgage Broking company. They have access to a range of loan products from a variety of lenders, including banks, credit unions, and other financial institutions. This means they can help you find a loan that suits your specific needs and circumstances.

Using a mortgage broker could potentially save you time and effort as they will handle the loan application process for you. They also understand the ins and outs of home loan products and can negotiate on your behalf. With them now having to follow the Best Interest Duty, you’ll know that you’re getting professional advice tailored to your needs.

2. Familiarize Yourself with Transfer/Stamp Duty

Transfer duty, also known as Stamp Duty outside of Queensland is a tax levied by Australian states and territories on property purchases. It’s often the largest expense a home buyer will face, outside the purchase price. The exact amount varies greatly depending on where you live, the value of your property, and whether it’s your primary residence.

There are often concessions and exemptions for first home buyers which can significantly reduce the amount of stamp duty payable. These vary by state, so it’s crucial to understand the specifics for the location you are purchasing in.

Speak to a mortgage broker or conveyancer to understand what your stamp duty obligations could be and what options you have available to you.

3. Grants

The First Home Owners Grant (FHOG) is a national scheme funded by the states and territories of Australia designed to help first home buyers. The grant varies from state to state and has specific eligibility criteria such as, but not limited to, the property value, whether the property is new or existing, and whether the buyer is an Australian citizen or permanent resident.

Application for the grant is generally made during the home loan application process, but it can also be completed post-settlement. It is important to take note that receiving the FHOG does not rule out stamp duty costs. In certain states, concessions or exemptions from stamp duty may apply for first home buyers, but these are separate to the FHOG.

If you want to find out what Grants are available, check out this article I wrote called Who is a First Home Buyer.

The rules can change, and the specifics can differ greatly between states, so be sure to do your research before relying on this scheme. Talk to your mortgage broker or look up the grants available to you from the correct government sources to get the most accurate and up-to-date information.

4. Learn about Loan-to-Value Ratios

The loan-to-value ratio (LVR) is a critical concept for any first home buyer to understand. Essentially, it’s a percentage that reflects the amount of your home loan compared to the value of the property. An old saying I hear a lot is that you require a LVR of 80% to buy a home, which means you’ll need a 20% deposit. This is not always true, read on to see why.

If you can’t save a 20% deposit, you may still be able to get a home loan. You’ll likely need to pay Lenders Mortgage Insurance (LMI) though, depending on the requirements of the lender. LMI protects the lender in case you default on your loan and can be a significant extra expense.

While a high LVR might enable you to buy a home sooner, it can also increase your financial risk if property values fall. Make sure to assess your financial situation carefully and consult with mortgage broker to understand your LVR options and LMI obligations.

5. Research the Market Thoroughly

As a first home buyer, it’s essential to research the property market extensively. Keep an eye on property prices in your desired area, inspect as many properties as possible, and monitor market trends. Understanding the local property market can give you an edge when negotiating a purchase price.

Attending open homes and auctions is a good way to familiarize yourself with the buying process. You’ll also start to understand what you can realistically afford and what type of properties you like.

Additionally, consider seeking advice from professionals. Real estate agents, mortgage brokers, buyers agents and financial advisers can provide invaluable insights and advice based on their industry knowledge and experience.

6. Get Pre-Approval for Your Home Loan

Before starting your property search, it’s wise to get a pre-approval for your home loan if that option best suits your needs. Pre-approval gives you an idea of how much a lender is willing to loan you, allowing you to focus your property search on homes within your budget.

It’s important to remember that pre-approval isn’t a guarantee that a lender will give you a loan, but it’s a strong indication of the amount they’d be willing to lend. It also demonstrates to real estate agents and sellers that you are serious about purchasing.

Pre-approval typically lasts for 3-6 months, so ensure that you’re ready to start looking for a property once you get pre-approval. If you haven’t found a property within the pre-approval period, you’ll likely need to apply again or get an extension if the lender offers it.

7. Beware of Extra Costs

When budgeting for your first home, it’s crucial to factor in additional costs beyond the purchase price. These can include building and pest inspections, conveyancing fees, moving costs, home and contents insurance, council rates, and utilities. I’ve written an entire article on it called First Home Buyer – Extra Costs to Consider.

Many of these costs arise before moving in, so you’ll need to have funds available to cover them. Understanding these costs early can help you budget appropriately and avoid any nasty surprises down the track.

It’s always recommended to have an emergency fund in case of unexpected costs. Property ownership can come with unexpected expenses, such as urgent repairs, so being prepared can give you peace of mind.

8. Understand the Contract of Sale

The contract of sale is a legally binding agreement between you and the seller. It outlines the terms and conditions of the sale, including the purchase price, settlement date, and any conditions such as building inspections or finance approval.

Before signing a contract of sale, have it reviewed by a solicitor or conveyancer. They will ensure you understand all the terms and conditions before you commit. If you’re buying at auction, this needs to happen before the auction day as a sale at auction is unconditional.

It’s also vital to understand cooling-off periods. A cooling-off period allows you to withdraw from the sale after signing the contract, but rules vary from state to state. Make sure you’re clear on your rights before signing anything.

9. Inspect the Property Thoroughly

Before purchasing a property, it’s vital to conduct thorough inspections. This usually includes a building inspection and a pest inspection, which can identify any potential structural issues or pest infestations.

You may also want to consider a strata report if you’re buying an apartment or townhouse. This report provides details about the financial health of the strata scheme and any potential major expenditures.

These inspections may save you from costly repairs down the line. While they might seem like an unnecessary expense when you’re already spending so much, they’re well worth the peace of mind.

10. Don’t Rush Your Decision

Finally, remember that buying your first home is a major decision and it shouldn’t be rushed. Take your time to research, inspect properties, and understand the financial implications of your purchase.

The property market can be unpredictable and sometimes stressful. Don’t be pressured into buying a property that isn’t right for you or exceeds your budget. Remember, it’s better to miss out on a property than to rush into a decision you might regret later.

Always be patient and keep an eye on the market. Your dream home is out there, and careful preparation will help you find it.

Conclusion

Buying your first home is a significant milestone, an exciting journey filled with potential and promise. It is also a journey laden with complexities that, if unprepared, can turn the experience from exhilarating to exasperating. As someone who has navigated this path, my advice is to arm yourself with as much knowledge as possible.

The more informed you are, the better decisions you’ll make and the more rewarding the experience will be. By understanding the Australian home buying landscape – from the First Home Owners Grant to hidden costs and thorough inspections – you’re setting yourself up for a successful and fulfilling home purchase. Be patient, be diligent, and don’t forget to enjoy the process. After all, there’s no place like your first home.

First Home Buyers

First Home Buyers – Extra Costs You Need to Consider

07/08/2023 Jesse Read

The prospect of buying a home is an exhilarating time in your life, but you need to know what you are up against. As an Australian homebuyer, you’re offered a plethora of property choices on the market. While you may be quick to fixate on the advertised purchase price, it is essential to factor in the hidden and extra costs in purchasing the home that you may not have thought about.

As the owner of Read Finance which is a mortgage broking company, I deal with first home buyers consistently. Recognising that there has been a common trend that first home buyers haven’t thought about additional fees they may come across, I’ve compiled a list of these that you need to keep in mind.

Home Loan Fees

Home loan fees, sometimes referred to as mortgage fees, are the costs associated with setting up, maintaining, and closing your home loan. In Australia, these fees can significantly vary depending on the type of loan, the lender, and the loan’s terms and conditions. Here are some of the common home loan fees you might encounter:

Application Fee – This fee is charged by the lender to set up the mortgage. The amount that it could be depends on the lender’s product that you are going with, and can typically range from free to a few hundred dollars. Some places may call this a Mortgage Establishment fee.
Property Valuation – To determine the value of the land and improvements a valuation is normally completed. Depending on the lender’s product you go for this commonly also ranges from being complimentary to a few hundred dollars.
Transfer Duty – There are grants offered by many of the states and territories of Australia that reduce or remove this fee for a first-time home buyer. This is known as Stamp Duty outside of Queensland.
Lenders Mortgage Insurance – Commonly referred to as LMI, this is insurance to protect the bank in case you default on your repayments. It may be a requirement by the lender, especially if you’re borrowing more than 80% of the property valuation.
Mortgage Broker Fee – We do not charge fees for first home buyers at Read Finance unless their circumstances require a considerable amount of more work. Any fees that we charge you will be discussed and provided on a credit quote after our first discussion, this is so we get an idea of your current circumstances. Different mortgage brokers have different fees but are required to provide you with a credit quote

Property Fees

Property fees in Australia encompass a range of costs associated with buying, owning, and selling property. These can include upfront costs like conveyancing fees (for legal services related to transferring ownership) as well as building and pest inspection fees, and if applicable more fees that relate to your first home purchase.

After purchasing a property, homeowners are also responsible for ongoing costs such as council rates, water rates, strata fees (for properties like apartments or townhouses), and home and contents insurance. Additionally, any maintenance or repair costs will also be the responsibility of the homeowner.

Inspections – Building, pest and electrical inspection fees. Depending on the lender’s policies you may be required to have some or all of these completed.
Insurance – Building insurance may be one of the requirements of the lender. Contents insurance is also something you may want to consider.
Legal – A solicitor or conveyancer to go over the legal documents and transfer of ownership.
Utility Costs – One fee that I’ve found that people often forget is the cost of setting up their utilities at the new home. There may be a connection or transfer fee
Council and Water rates – Ongoing rate fees will apply once you have purchased the property.
Strata / Body Corporate – Buying a property on a strata title or an apartment will lead to body corporate fees. This could be substantial fees if there are any major areas of concern.
Building Maintenance – Even if you are not making significant renovations, you should plan for regular property maintenance.

Conclusion

In conclusion, while the prospect of buying a home in Australia is exciting, it is essential to be aware of the hidden and extra costs associated with the purchase. As a prudent homebuyer, you should not solely focus on the advertised purchase price but also take into account various home loan fees and property costs. It’s crucial to consult with a mortgage broker like Read Finance to get a clear understanding of these fees and how they might impact your overall budget.

As you embark on your journey to homeownership, having a comprehensive understanding of these costs will enable you to make informed decisions and better plan your finances. Being financially prepared for all aspects of buying and owning a home will set you up for a successful and enjoyable homeownership experience in Australia.