I was thinking about buying a property...I saw that some prices are tending to decrease. Is it a good time to do it? Or should I wait? I was waiting to have a higher down payment but maybe there are interest benefits currently that allow me to buy at an overall lower price.
Stacey in Wellers Hill, Qld
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Aaahhh the question that’s often thought about but rarely asked! When it comes to purchasing property it’s always a good time to buy and adversely there’s always going to be a better time to buy. With so much going on, you’re never going to get it exactly right, but you can minimise some of the variables which I’ll come to later in the response. There is always an event which will and/or does impact specific sectors, prices and markets.
Property, much the same to fashion, seems to alter in regard to particular demanding trends as time goes on before, offering up a similar solution that was highly sought after year and years ago. To put this in context, noting that you live in Wellers Hill, there was an absolute boom for townhouses in Wellers Hill / Holland Park and Greenslopes in the late 90s, then it died off, then it arose again in the late 2010’s and feed the need of consumers for a few years and then died off, most of the articles published today indicate that there is a current oversupply, but given the entry price, purpose and position it may be the perfect vehicle for those with particular circumstances or aims. What I would challenge you to think about would be two things, Purpose and Preparation.
Purpose - what are you looking to buy for? Is it a rental? Is it to live in? Is it to reduce weekly expenditure and increase your personal assets? Is it to do a combination? Are we looking to expand a family, gain additional weekly income to reduce a mortgage or perhaps purchase an old house closer to a uni for future needs? Given the limited info in the question you may have already clarified this, but if we are able to be really clear about WHY we want something and it sets a specific purpose for the future to allow us to achieve (enter reason here) as the timing becomes less relevant overall because the purpose will help you navigate through current attractive ''incentive or opportune periods'' and save you buying something in a rush that you later regret or no longer suits your needs.
Preparation - let’s be frank, no one wants to pay excess fees / charges or costs if we can get away from it, we work hard for our funds and they, in turn should work hard for us. Setting up for a property purchase can be and often is, daunting and stressful. The process of looking online, getting emotionally attached only to find a contract went in force yesterday time and time again is draining. Preparing yourself and your finances can be a great way to breeze through the process with minimal hiccups, things like having a deposit, having dedicated savings, having tax bills addressed and lodgements / returns ready to send can save a mountain of unnecessary back and forth. Given the ever-increasing prices these days, having a 20% deposit can often be a challenge in itself so the government has recently offered a solution.
The First Home Loan Deposit Scheme is an Australian Government initiative to support eligible first home buyers purchase their first home sooner. Usually first home buyers with less than a 20 per cent deposit need to pay lenders mortgage insurance. Under the Scheme, eligible first home buyers can purchase a modest home with a deposit with as little as 5 per cent (lenders criteria also apply).
There’s a few other requirements so I’ve attached a link here https://www.nhfic.gov.au/what-we-do/fhlds/. As always seeking good advice from an Adviser, Accountant and Lawyer can steer you in the right direction and guide you through the process to ensure your experience is a positive one.
Thank you for your question!
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