Sold! The trials, tribulations and joys of buying a Home.

[AFreshStart]

Hi Guys,

Well it's been a while since I've given an update. We've been here just under 4-months and continue to enjoy the journey and the experiences we are both undertaking and creating. Loads of adventures: camping, beaches and getting to know our neighbours better.

As the title suggests we've just bought out first home here in Sydney and will move in just over 5-weeks.

We decided a month ago to start looking at buying as renting was killing us. We knew we wanted to stay in the inner city and started looking at the Green Square areas of Zetland, Beconsfield, Waterloo and Alexandria.

For those that don't know the area is getting an $8 billion upgrade through 2030: new parks, library, plaza and aquatic center, many of which are right on our door step.

Over the course of the month we earmarked 30 properties, visited 10, put in an a offer on one, lost it and finally bought our new apartment. It's a lovely 2-bedroom with loft/office space in a small block of 37 units, 950m from Green Square station, a 5-minute walk to Redfern Park, 2-mins to Waterloo Oval and still within in the School zone for our son.

It's startling to see what property prices are doing in the area, even buying off plan. We first looked at 2 developments coming on-line in late 2016 and the other in 2017, 77-88m2 units going for just under and over $1million and realized that our return on interest in the bank wouldn't yield anywhere close to the returns to even allow us to buy in that price range in a year or 2.

It pushed us into looking into completed units and funny enough our unit was completed only a year ago by the developers of the said $1million dollar units and we able to get a much better price, taking advantage of the lower interest rates.

We'll actually be saving almost a 3rd of what we are spending on monthly rent paying into something we'll own. We've taken a 30-year bond and arranged interest only for the first 3 to allow us to build our savings back up having depleted ALL our savings by ploughing it into buying our home.

Something to be aware of in NSW is a term called Gazumping. In SA we'd call it 'horse trading' putting buyers against each other, which is legal here, unlike SA. Here they don't even take a written offer, it's verbal or via a text/e-mail and then pit you against other buyers. It's how we lost our first property by being outbid by another seller as it turns into a frenzy, which is why I see now why so many choose to go the Auction route.

A couple tips, if you are looking to buy, chat to a mortgage broker, find the best deal and get pre-approved.

Next have a solicitor on call, we managed to arrange with ours that he would look at all potential contracts for free, on the provisor if we won we'd give him the conveyancing work.

If you are serious about a property get an independent strata report done (on strata units), it costs around $250+, but consider that you'll be spending hundreds of thousands and its worth sinking it.

It's how we got in on this property. It was set for auction, but since we had all the info on hand we were able to we made a strong offer, armed with the information. There were stronger offers, but nobody was ready like we were, having arranged finances, drawn the deposit and were ready to sign, so while we were gazumped, the owners went with us because we could exchange almost the same day.

This meant they got a sale, avoided an auction and we missed the frenzy, saving at least $50k - $80k as similar properties went for that or more in the different between a fixed deal over auction.

We are blessed to be in the market again and look forward to having our own home and hope the info above might help some of you looking to purchase your first home or investment property.

Cheers

Matt

[Mel-B]

Thanks for sharing and CONGRATS! How exciting!

[Pell]

Yep, learning about all this as we priority hunt every weekend... Insane market out there.

Congrats on your purchase!

[greggle]

Congrats, that's amazing!

I have just put my house on the market here in Cape Town, which will be the deposit for our next one in Sydney. Part of my partner's Australian law conversion was 'conveyancing' so I'm hoping that all the crammed info comes flooding back when our time comes to buy!

[Batsie]

Very insightful, thanks for sharing.

[HansaPlease]

Congrats on the new house!

Definitely pays to be ready and flexible. We had a "closed bid" system when we bought our place - three parties put in their offers and terms and the owner decided on their preferred one on a set date and time. Far less painful than an auction if you ask me. Owner had to sell as they had already purchase their new place and it was a marriage breakup.

We were the middle offer, but the owner chose us over the higher one because we were flexible on settlement.

For some bizarre reason the party with the higher offer would not budge on terms even though they had the same scenario as us - breaking their rental lease.

Breaking our lease cost us $700. But it probably saved us $50k on a house we otherwise would not have been able to afford! I'm still baffled as to why the other party would not budge - silly. Yay for us!

Enjoy your new pile of bricks!

[AFreshStart]

Congrats on the new house!

Definitely pays to be ready and flexible. We had a "closed bid" system when we bought our place - three parties put in their offers and terms and the owner decided on their preferred one on a set date and time. Far less painful than an auction if you ask me. Owner had to sell as they had already purchase their new place and it was a marriage breakup.

We were the middle offer, but the owner chose us over the higher one because we were flexible on settlement.

For some bizarre reason the party with the higher offer would not budge on terms even though they had the same scenario as us - breaking their rental lease.

Breaking our lease cost us $700. But it probably saved us $50k on a house we otherwise would not have been able to afford! I'm still baffled as to why the other party would not budge - silly. Yay for us!

Enjoy your new pile of bricks!

Hey Hansa,

Yes, exactly, we chose to break lease as well, at the minimum we are looking at $1000 penalty and they further wanted another $1000 to advertise the property, thing is I've got 2 diplomas in both graphic and interior design with a major in photography and have been shooting and styling homes for years for various magazines, so after seeing my pics of the place they decided to waiver that fee, on condition they can use my images for the ad. Bonus for us.

The owners are disappointing as we'll have only seen out 5 of the 15 month lease and they couldn't have asked for better tenants, we had every intention of seeing the lease out, but our circumstances have changed and are thrilled to be able to get into the market and if they shoe was on the other foot they'd have no problem asking us to leave if they cut their trip abroad short... so...

Cheers

Matt

[elleneo]

Such an exciting topic! Our lease ends in October so we have started looking at properties now, gotten the bond originator out and doing research into different suburbs.

It can be a long process to buy, you need to check out all your options, the scope of what you can buy for your money is huge, depending on suburbs, apartment v house,condition,land size,distance to station, proximity to schools and shopping all make a difference to what you can get for your money.

We have an only child who's is 8 so we can take a smaller place than most which is helpful, saying that I know of many who took up to a year to secure a property ( get outbid, sale falls through,finding the right house) I'm hoping to be in our own place by early next year, and being on a month to month lease I'll have no stress on that side of the move.

Congratulations on your aussie home! Very exciting indeed!

Edited March 3, 2015 by elleneo

[Cole]

Ah that's so cool, congratulations and thanks for all the info!

[SML]

Very exciting for you guys!

[MomOfTwo]

Hi Guys,

Well it's been a while since I've given an update. We've been here just under 4-months and continue to enjoy the journey and the experiences we are both undertaking and creating. Loads of adventures: camping, beaches and getting to know our neighbours better.

As the title suggests we've just bought out first home here in Sydney and will move in just over 5-weeks.

We decided a month ago to start looking at buying as renting was killing us. We knew we wanted to stay in the inner city and started looking at the Green Square areas of Zetland, Beconsfield, Waterloo and Alexandria.

For those that don't know the area is getting an $8 billion upgrade through 2030: new parks, library, plaza and aquatic center, many of which are right on our door step.

Over the course of the month we earmarked 30 properties, visited 10, put in an a offer on one, lost it and finally bought our new apartment. It's a lovely 2-bedroom with loft/office space in a small block of 37 units, 950m from Green Square station, a 5-minute walk to Redfern Park, 2-mins to Waterloo Oval and still within in the School zone for our son.

It's startling to see what property prices are doing in the area, even buying off plan. We first looked at 2 developments coming on-line in late 2016 and the other in 2017, 77-88m2 units going for just under and over $1million and realized that our return on interest in the bank wouldn't yield anywhere close to the returns to even allow us to buy in that price range in a year or 2.

It pushed us into looking into completed units and funny enough our unit was completed only a year ago by the developers of the said $1million dollar units and we able to get a much better price, taking advantage of the lower interest rates.

We'll actually be saving almost a 3rd of what we are spending on monthly rent paying into something we'll own. We've taken a 30-year bond and arranged interest only for the first 3 to allow us to build our savings back up having depleted ALL our savings by ploughing it into buying our home.

Something to be aware of in NSW is a term called Gazumping. In SA we'd call it 'horse trading' putting buyers against each other, which is legal here, unlike SA. Here they don't even take a written offer, it's verbal or via a text/e-mail and then pit you against other buyers. It's how we lost our first property by being outbid by another seller as it turns into a frenzy, which is why I see now why so many choose to go the Auction route.

A couple tips, if you are looking to buy, chat to a mortgage broker, find the best deal and get pre-approved.

Next have a solicitor on call, we managed to arrange with ours that he would look at all potential contracts for free, on the provisor if we won we'd give him the conveyancing work.

If you are serious about a property get an independent strata report done (on strata units), it costs around $250+, but consider that you'll be spending hundreds of thousands and its worth sinking it.

It's how we got in on this property. It was set for auction, but since we had all the info on hand we were able to we made a strong offer, armed with the information. There were stronger offers, but nobody was ready like we were, having arranged finances, drawn the deposit and were ready to sign, so while we were gazumped, the owners went with us because we could exchange almost the same day.

This meant they got a sale, avoided an auction and we missed the frenzy, saving at least $50k - $80k as similar properties went for that or more in the different between a fixed deal over auction.

We are blessed to be in the market again and look forward to having our own home and hope the info above might help some of you looking to purchase your first home or investment property.

Cheers

Matt

Congratulations...im almost jealous lol....we still have such a long way to go...as in, we are still not even in Aus..but I'm dreaming of this day already and all ur info and advice is being saved in a special folder :-)

Question though, how did you get all your things in order having arranged financed and get a independent strata report? How did u know that house is going to be on auction...and how many weeks or months before it was meant for auction did u start doing ur homework and getting ur affairs in order....i didn't realize you can secure a home loan without the actual house? Sorry I'm still new at this....xx

[AFreshStart]

Hi MomOfTwo,

I seemed to have missed your response, forgive the tardy response.

RE getting the mortgage approved we spoke to a mortgage broker who acted on our behalf, who we met through his brother-in-law, who handled our life policies, who in turn is an aquientance of the attorney that drafted our Aussie will, incidentally all ex South Africans.

Since they all knew each other it was easy. Once we were pre approved we knew what we could spend and I started looking at properties on-line through Real Estate, researching Suburbs etc.

We actually put in an offer on another place and were outbid.

When we saw our home we knew it was going to Auction, it also had loads on interest, people streaming in and out and we knew if it went to auction it would go for far more than the suggested sale price.

I asked the agent if the sellers would be interested in selling out of auction, they were and had a few offers, some higher than ours, but we had access to the funds quickly and easily as we had been pre approved and had the deposit in cash.

Our solicitor offered to look over any and all contracts for free, provided that if we decided to buy a property we would give him the work.

He then uses an independent strata company, who draw up the records and assement for you. You pay for this report and you'd need to do it on any property to make sure their are no glaring issues, a decent sinking fund and good overall upkeep, which there thankfully was.

RE securing a loan without a house, yes, easily done, in fact if the loan is under $1 million most banks won't even bother to have an asset come look at the property.

Pre approval of course is done on your credit score, salary and ability to pay back the funds you intent to borrow.

Hope that helps!

Cheers

Matt

[Heather]

Hi Everyone

I am a mortgage broker and have helped many people on this forum over the last who knows how many years.... I am able to help everyone in any area even though I am based in Queensland. It is not hard to get a pre-approval, it just takes a bit of time as you need to lodge the application as if you are buying but without an address, unless you are going to the auction then you can get the house valued upfront , building and pest done and all ready to go, they then dont call this a pre-approval, this is a full approval and most of the auctioneers require this on the day of the auction. If you are not fully approved, you run the risk of bidding at the auction and winning the bid but then not getting approved for finance, this would be a disaster as you have no option but to go ahead an purchase the property and have to find the money somehow as it is legal and binding. I always suggest to my clients that they make an offer prior to the auction or advise the auctioneer that they would like to make an offer after the auction if it does not sell and they dont allow a pre-auction bid. The banks are sometimes a bit lenient with valuations if there is a sound contract of sale and it falls within certain criteria. The valuers are picked by the different lenders and each has their own criteria. You can look at buying here before coming over.

I am happy to answer any questions from anyone and always happy to help.

regards

Heather

[CGP]

Hey, you are making the rest of us look bad! I've been here over 2 years and still no house

congrats and thanks for the post.

[rozellem]

It took us 4 years in Sydney to buy a house.

[AFreshStart]

As shared, it wasn't our intention to buy, we had every intention of staying in our rental, but after a few months we were barely coming out and so we scaled back, down and out the suburb we were living in (no way we could afford a property there).

It's not a house, but a 2-bed apartment, but big enough for the 4 of us and we've made it a home and it's an entry point into the local market and saving us money over renting.

Two or three other properties have already sold for well over what we have paid and if we ever moved on the rental would cover the mortgage as it has a high rental market, minutes from the city, bus stop outside, 900m walk to Green Square station etc.

We count ourselves blessed and most fortunate.