How To Find The Best Home Loan For Your Property In Western Australia
Many home buyers don’t actually know how much they can afford to borrow until they actually apply for a loan. This situation is not ideal because an informed home buyer is always in a much better position to make an offer on a property.
Up until about ten years ago it was pretty much the case that the ‘rule of thumb’ for buying a home was that you could borrow about three times your gross household income. So, if a couple was making $110,000 between them each year, a bank might loan up to $330,000.
This rule of thumb doesn’t apply terribly well today with house prices having grown so much. In January this year, the median purchase price for first home buyer in Western Australia was $400,000.
Of course, the price will vary depending on the suburb you are interested in. For example, in 2010, the median purchase price in the popular suburb of Subiaco was $1.3 million while in Kardinya is was $600,000. You can research other Western Australian real estate prices at the REIWA web site.
One way to a smooth start with a home loan is to have a healthy deposit. If you don’t have a deposit, it’s a good idea to start a regular savings program in preparation. Lenders do require evidence of savings before approving a home loan.
A trap for many first time borrowers is to put all their savings into the purchase of a new home. It’s wise to have a cash reserve of at least two months mortgage repayments to cover unexpected costs.
Talk to your financial institution or mortgage broker about the deposit. Most prefer a deposit of around 10 per cent the purchase price, but this is becoming unrealistic. Deposits of 5 per cent are now common.
Ask your lender to outline, in detail, all the fees that apply to the loan. Remember to including mortgage costs, mortgage insurance, stamp duty or any other fees that may apply. These costs are added to your home loan. Rather than looking at how much the bank will allow you to borrow, it makes more sense to concentrate on how much you can comfortably afford.
For more information about home affordability and applying for a home loan, please visit www.reiwa.com.au
REIWA Dismisses Perth Property Growth Claims By BIS Shrapnel
The Real Estate Institute of Western Australia has dismissed claims by BIS Shrapnel, that house prices in Perth, WA would grow by around 7 per cent each year for the next three years.
REIWA President Alan Bourke said this prediction was not supported by current trends in real estate data.
“REIWA data is showing that the number of properties on the market in Perth has jumped by 32 per cent since January, with more than 14,000 listings currently up for sale in a sluggish market,” said Mr Bourke.
Mr Bourke said the rental market in Perth was also quite soft.He said rents have remained steady for more than a year and a half and that the vacancy rate of available properties is hovering around 4.
“The reality is that the uncertain economic conditions overseas, coupled with concern about the resources super tax and a lowering of the expected migration intake over the next year is making the local market very flat, with many buyers waiting until after winter and the looming Federal election to see how things pan out.
“I expect that the Perth property market will be very steady for at least the next year, then after that we may start to see some modest growth, but nothing like 22 per cent over three years, that just isn’t realistic under current conditions,” Mr Bourke said.
Mr Bourke said Perth was now a buyer’s market. Home opens seeing many people doing the rounds to make sure they saw everything in their price range to ensure the best deal.
“Sellers need to understand that the Perth market will be flat for at least a year, so it’s important to listen to your agent about setting the right price for a quick sale,” Mr Bourke said.
How To Choose A Block Of Land In Perth
You have just arrived at a new land estate with the intention of buying a block on which you will build your future dream home. How will you pick the best block? At the moment there is a huge choice of land estates in Perth.
The decision can be hard to make, especially if there is little or no difference in price. Data by the Real Estate Institute of Western Australia indicates there are more than 2,000 blocks of land currently on the metropolitan Perth real estate market.
If you are in this situation, it’s important not to get flustered and just think about the best site characteristics to suit your building plans.
Imagine the likely house design and its orientation with the block. Think about energy efficiency and try and maximize the areas which face north to receive the winter sun, and conversely minimize the exposed window areas facing west into the summer sun.
Ask the developer or local Council about the minimum distance required between the front of the house and the road and the distance required between the house and side fences. These are known as ‘setbacks’. If you have bought a block and find that the setbacks don’t suit your preferred design you’ll have to change it or possibly chance your luck and seek special consideration from the Council.
What might you see out of your new windows? If you are buying into a production home area make sure you have a good level of privacy that meets your needs.
Does anything have the potential to block your views? What are the builder’s plans for homes around you? Is any urban construction planned by the Council which might later be visible from your site?
How is the lot shaped? How best will your home of choice fit on it? It may be worthwhile to inspect the block with your preferred builder to advise on the suitability of the block for your home design.
If the block slopes, calculate the extra cost that might be involved to level it. Even blocks that look flat can sometimes have a slight sloping that requires some site works.
How will the area drain? If it’s in a low lying area check that the available draining system will prevent flooding and consider any possible run-off water from adjoining blocks on higher ground.
Ask about easements for access, utilities and any other purposes that created their existence. In most cases, you are not permitted to build any structure over an easement. This may include pools, sheds or future extensions.
Finally, if you are lucky enough to be buying a block near any of Perth’s beach areas or in any of the expanding coastal suburbs, you might like to find a well positioned one where you can best catch the cooling sea breeze during summer.
Real Estate Perth: How Winter Can Be A Great Time To Buy
Seasonal weather patterns do influence the real estate market. Real estate in Perth is no exception. February to April and then again from October to November are the peak selling periods for real estate in Perth. During these periods the number of homes sold can be up to 20 per cent greater than other months. Home sales are historically at their lowest levels during the mid winter period of July and August and the holiday months of December and January.
At the end of March this year the number of homes on the market was around 13,000, but this has jumped to more than 14,000 in more recent months. Overall real estate listings in Perth have grown by more than 30 per cent since January.
Home opens are a good indicator of market activity. In warmer months people are more likely to do inspections, while in winter the cooler conditions, shorter days and footy matches on the TV keep most people inside.
Despite fewer sales occurring in winter the average time taken to sell properties does not vary a great deal throughout the year. Fewer sales in winter is usually a result of fewer properties for sale.
Serious home buyers aren’t too concerned about the weather, but interestingly it seems that those who make a decision about buying in winter do so after visiting fewer homes.
Remember to adapt selling strategies during the winter months. Advertising can be more important in winter to attract the more serious home buyers. And if it is cold and wet on the day of a home open, it pays to take some sensible steps to keep the place warm, dry, well lit and welcoming. If necessary, have a stand for umbrellas by the front door and a decent mat to keep the floors tidy.
From a buyer’s perspective, a wet and windy day is an opportunity to see how the home holds up, potentially exposing faults such as leaky roofs or inadequate storm water drainage. Such a day will help a prospective buyer understand the heating needs of the home.
Homebuyers can also find the winter months more beneficial when negotiating on the terms and conditions for a property sale, because the market is slower.
The current Perth real estate market indicates that some asking prices are coming down a little. With many owners still keen to sell, winter could prove an ideal opportunity for first home buyers. So, if you’re in the Perth real estate market for a first home now’s a great time to find a more affordable home and negotiate a good deal on the sale price.
How To Choose A Block Of Land In Perth
You have just arrived at a new land estate with the intention of buying a block on which you will build your future dream home. How will you pick the best block? At the moment there is a huge choice of land estates in Perth.
The decision can be hard to make, especially if there is little or no difference in price. Data by the Real Estate Institute of Western Australia indicates there are more than 2,000 blocks of land currently on the metropolitan Perth real estate market.
If you are in this situation, it’s important not to get flustered and just think about the best site characteristics to suit your building plans.
Imagine the likely house design and its orientation with the block. Think about energy efficiency and try and maximize the areas which face north to receive the winter sun, and conversely minimize the exposed window areas facing west into the summer sun.
Ask the developer or local Council about the minimum distance required between the front of the house and the road and the distance required between the house and side fences. These are known as ‘setbacks’. If you have bought a block and find that the setbacks don’t suit your preferred design you’ll have to change it or possibly chance your luck and seek special consideration from the Council.
What might you see out of your new windows? If you are buying into a production home area make sure you have a good level of privacy that meets your needs.
Does anything have the potential to block your views? What are the builder’s plans for homes around you? Is any urban construction planned by the Council which might later be visible from your site?
How is the lot shaped? How best will your home of choice fit on it? It may be worthwhile to inspect the block with your preferred builder to advise on the suitability of the block for your home design.
If the block slopes, calculate the extra cost that might be involved to level it. Even blocks that look flat can sometimes have a slight sloping that requires some site works.
How will the area drain? If it’s in a low lying area check that the available draining system will prevent flooding and consider any possible run-off water from adjoining blocks on higher ground.
Ask about easements for access, utilities and any other purposes that created their existence. In most cases, you are not permitted to build any structure over an easement. This may include pools, sheds or future extensions.
Finally, if you are lucky enough to be buying a block near any of Perth’s beach areas or in any of the expanding coastal suburbs, you might like to find a well positioned one where you can best catch the cooling sea breeze during summer.
Real Estate Perth: How Winter Can Be A Great Time To Buy
Seasonal weather patterns do influence the real estate market. Real estate in Perth is no exception. February to April and then again from October to November are the peak selling periods for real estate in Perth. During these periods the number of homes sold can be up to 20 per cent greater than other months. Home sales are historically at their lowest levels during the mid winter period of July and August and the holiday months of December and January.
At the end of March this year the number of homes on the market was around 13,000, but this has jumped to more than 14,000 in more recent months. Overall real estate listings in Perth have grown by more than 30 per cent since January.
Home opens are a good indicator of market activity. In warmer months people are more likely to do inspections, while in winter the cooler conditions, shorter days and footy matches on the TV keep most people inside.
Despite fewer sales occurring in winter the average time taken to sell properties does not vary a great deal throughout the year. Fewer sales in winter is usually a result of fewer properties for sale.
Serious home buyers aren’t too concerned about the weather, but interestingly it seems that those who make a decision about buying in winter do so after visiting fewer homes.
Remember to adapt selling strategies during the winter months. Advertising can be more important in winter to attract the more serious home buyers. And if it is cold and wet on the day of a home open, it pays to take some sensible steps to keep the place warm, dry, well lit and welcoming. If necessary, have a stand for umbrellas by the front door and a decent mat to keep the floors tidy.
From a buyer’s perspective, a wet and windy day is an opportunity to see how the home holds up, potentially exposing faults such as leaky roofs or inadequate storm water drainage. Such a day will help a prospective buyer understand the heating needs of the home.
Homebuyers can also find the winter months more beneficial when negotiating on the terms and conditions for a property sale, because the market is slower.
The current Perth real estate market indicates that some asking prices are coming down a little. With many owners still keen to sell, winter could prove an ideal opportunity for first home buyers. So, if you’re in the Perth real estate market for a first home now’s a great time to find a more affordable home and negotiate a good deal on the sale price.