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Buying a house


Naz
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Hi, quick question to put out there, on average how long did it take to purchase your first home in Oz and

Has it generally been in the first area you landed in....interesting to know. Thanks

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Hi,

That would depend on your financial capability. I have friends that bought a house within the first year of coming over. Others have been here for almost 4 yrs and although they have the capability, they are choosing to wait until the house prices come down. There are rumours that the property bubble will burst in 2015/2016 (in some cities), but that remains to be seen.

If you can buy a house, GREAT!! Saves you the hassle of renting, dealing with agents, 3 monthly inspections and the DREADFUL bond cleaning when you move...

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We bought our house within four months of landing in Brisbane.

As for waiting for the housing bubble to burst, the articles I read say dream on. There has been some softening in some markets over the last ten years (and probably longer) but overall Australia has a housing shortage because we all live around the edges and nobody wants to live in the middle. Also councils want to avoid urban sprawl so do not release enough land, resulting in price pressures. Government intervention with the first home owners grant and such like only served to drive up prices by the same margin.

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We only bought after 4 year, but that was mainly due funds being stuck in SA and due to us being on a 457 with limited purchase options when we first arrived.

Agree with the comments regarding bubbles, don't wait for the bubble to burst if you plan on buying anywhere regarded as prime real estate. In Melbourne that is in the inner suburbs (all around) and the South Eastern and Eastern Suburbs up to about Ringwood. We had long discussions with various entities prior to buying and their view was areas of high demand were unlikely to soften while newer areas may stagnate for a period (basically until supply and demand caught up in the outer suburbs), but even in those areas there are many that are not coming down or stagnating (sort of depends on the suburb, schools and amenities).

Also, I read about bubbles from the day we arrived. The only slow period was 2011 and prices didn't go down, just flattened or grew slowly.

Talking to guys in the office who deal with property more than I do, I believe that even the Gold Coast is recovering and the great opportunities of 2009 and 2010 are things of the past.

The reports regarding house prices talk quite openly about how the Chinese investor market is pushing prices up and will continue to do so while Chinese investors see Australia as a safe haven (when I say Chinese I mean investors from mainland China investing with plenty of foreign currency often that they don't want to repatriate to China). So perhaps look at neighbourhoods that are not popular with Chinese investors. That sort of worked for us, as there were no Chinese bidders bidding for our house even though the Chinese population in surrounding suburbs is about 10% (which is high based on demographic info) - I don't know why that was the case, but was very grateful when we heard "Sold!"

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You are lucky that you are in Brisbane. Its bad here in Sydney. We have foreigners buying up our property at ridiculous prices. A guy made the news by buying his kid an apartment. He did it because he didn't want his kid to be forced to rent his entire life.

Unfortunately there are few laws stopping foreign ownership of property in Australia like there are in most other countries. And right now anything near Sydney hasrbour is hot property.

Edited by monsta
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You are lucky that you are in Brisbane. Its bad here in Sydney. We have foreigners buying up our property at ridiculous prices. A guy made the news by buying his kid an apartment. He did it because he didn't want his kid to be forced to rent his entire life.

Unfortunately there are few laws stopping foreign ownership of property in Australia like there are in most other countries. And right now anything near Sydney hasrbour is hot property.

Non resident foreigners cannot buy established properties in Australia, only new properties.

Edited by Fish
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We bought 4,5 years after landing in Sydney. I personally think bubbles popping will not really effect you if you buy a house for you and your family to live in for the long term. In the bigger picture, historically, the curve always goes up. If you use the property market to speculate and invest your money, you need to keep an eye on the bubbles. The market in Sydney has gone bonkers since we bought in May 2013. But we will not be selling this 1960's beauty, I will be carried out of here!

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Fish, are you certain that your understanding is still correct?

That was certainly true when we were on our 457 visa, but I understand that they loosened the rules again in about 2012 after the "slump" of 2011 and it is a lot easier for foreign investors to buy existing houses.

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Fish, are you certain that your understanding is still correct?

That was certainly true when we were on our 457 visa, but I understand that they loosened the rules again in about 2012 after the "slump" of 2011 and it is a lot easier for foreign investors to buy existing houses.

Yes, non-resident foreigners are restricted to new stock. Temporary resident (457 etc) foreigners can buy one established home and unlimited new homes. Maybe that was the change you were thinking about ?

See: http://www.firb.gov.au/content/guidance/downloads/gn3_jan2012.pdf

"Established (Second-Hand) Dwellings

Non-resident foreign persons cannot buy established dwellings as investment properties or as homes."

Edited by Fish
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We bought our home one month after arriving. (We made an offer to purchase prior to arrival). But our situation was not usual as te seller was willing to wait for us to get here and get finance approval.

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We only bought after 4 year, but that was mainly due funds being stuck in SA and due to us being on a 457 with limited purchase options when we first arrived.

Agree with the comments regarding bubbles, don't wait for the bubble to burst if you plan on buying anywhere regarded as prime real estate. In Melbourne that is in the inner suburbs (all around) and the South Eastern and Eastern Suburbs up to about Ringwood. We had long discussions with various entities prior to buying and their view was areas of high demand were unlikely to soften while newer areas may stagnate for a period (basically until supply and demand caught up in the outer suburbs), but even in those areas there are many that are not coming down or stagnating (sort of depends on the suburb, schools and amenities).

Also, I read about bubbles from the day we arrived. The only slow period was 2011 and prices didn't go down, just flattened or grew slowly.

Talking to guys in the office who deal with property more than I do, I believe that even the Gold Coast is recovering and the great opportunities of 2009 and 2010 are things of the past.

The reports regarding house prices talk quite openly about how the Chinese investor market is pushing prices up and will continue to do so while Chinese investors see Australia as a safe haven (when I say Chinese I mean investors from mainland China investing with plenty of foreign currency often that they don't want to repatriate to China). So perhaps look at neighbourhoods that are not popular with Chinese investors. That sort of worked for us, as there were no Chinese bidders bidding for our house even though the Chinese population in surrounding suburbs is about 10% (which is high based on demographic info) - I don't know why that was the case, but was very grateful when we heard "Sold!"

For instance Chinese people don't like buying houses were the driveway goes down.It's considered unlucky.

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Thanks guys for all your very informative responses. We have been looking at properties in south eastern suburbs, but the commute to the city for my husband is so long . While it is gorgeous here, I feel it a but far . In terms of pricing though the affordability is fine, can anybody advise on suburbs say 30 minutes from city I can investigate. We are based in Berwick at present which is about a one hour train commute to the CBD where hubby works!

I greatly appreciate all the input and responses!!!!

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For instance Chinese people don't like buying houses were the driveway goes down.It's considered unlucky.

They have gotten over this in Sydney !!

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For instance Chinese people don't like buying houses were the driveway goes down.It's considered unlucky.

this is interesting...we live in Nicholls and all around us are Chinese and most driveways go down...it's very hilly here :) even the house we rent is from a Chinese dentist here in Canberra, and our driveway is not horizontal

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Do you guys mean the driveway must not go down towards the house or down away from the house?

We bought after 10 months on a temporary business visa with FIRB approval. It was about 2 suburbs away from where we rented.

I think by non-resident Fish, that must mean people that literally live overseas?

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If you are looking, I would suggest that you start watching the real estate pages like a hawk to see the selling prices in the area. In Melbourne, at least in some ares, it seems common for the asking price to be way below the target selling price. If you are not in country, google street view can be a God send. Finally, mentally narrow all photographs - estate agents seem to be very fond of taking photos then stretching them along the horizontal.

Ask for a section 32 for any house you are interested in and question anything you don't understand. If it is an older house, or if you have any doubts, would strongly advise a pre-purchase inspection (which you will have to pay for). Have also found the local city council to be literally a delight to deal with in terms of asking questions - could have knocked me down with a feather!

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This is not a house for sale but it does show how some pictures can be very deceiving.

The photos provided by many estate agents can mean when you arrive to view a property you are immediately met with disappointed by the reality.

post-17492-0-47360100-1396926752_thumb.j

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Just a note for all readers of this thread: a section 32 on a property only applies to Victoria. Every state has completely separate laws and other states won't know what you are talking about.

For property info have a look at www.somersoft.com

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Another tip i received from someone in Canberra (this is not confirmed, just something I have been told) is that you have to request the approved building plans of the house if at all possible. An owner is allowed to sell a property even if there is a portion without approved building plans but if there is damage like a fire or something to that part, it is not covered by insurance.

Feel free to correct me :) this is just hearsay but it does make sense

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Been in Australia since June 2008 and still have not been able to afford to buy a house. Can't see that chaging anytime soon. How people save up for a 5%-10% deposit on an average $600,000 house whilst still renting and trying to survive each day is beyond me. I have many times thought that surely I must be missing something....... Wish that someone would share their secrets on how they managed to scrape that huge deposit together.

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Been in Australia since June 2008 and still have not been able to afford to buy a house. Can't see that chaging anytime soon. How people save up for a 5%-10% deposit on an average $600,000 house whilst still renting and trying to survive each day is beyond me. I have many times thought that surely I must be missing something....... Wish that someone would share their secrets on how they managed to scrape that huge deposit together.

i

It is very tough Heymanse. We used LMI (Lender's Mortgage Insurance) the first time and ANZ added it to the loan. It was a big rip-off, but anyway...

Then we really worked on the house to build up equity so that we had a 20% deposit for the 2nd house in Australia.

I don't really know a better way of going about it.

Even 10% of $600k is tough to save! It used to be easier with the First Home Owners Grant but I really think that was just pushing prices up.

I think you still get the FHOG on a new build (well we do in Qld). You could look at a build or go for a kit home, which I find interesting.

I also like a house with granny flat potential because if you get it right it can take years off your mortgage.

I'll actually start a new thread on the Kit Homes to get opinions.

Edited by Bronwyn&Co
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We do still get the FHOG here in NSW too but it will only cover maybe half of the 5% deposit we would need. Problem is, you have to buy a new house and though that is really nice and all, these new houses are all mostly situated further out from where I work and will mean that I will have to travel further to and from work (spending more time on the road). Unfortunately, I don't have the option of using public transport (I can, but that will add even more travel time each day). The thought of never being able to afford our own home is quite depressing (even more so when so many people that I work with buy houses and seem to be able to do it so easily without blinking... :glare: )

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The other thing you can do is look for a cheap and ugly unit and fix it up and put tenants in it for a few years. Hopefully cover the mortgage. That way you sell and use the profit as a deposit...only problem is that the house market moves up too so you would have to be lucky with your choice of unit.

The truth is that it's much cheaper to rent. It's just our mindset to own a house. Australia is extremely expensive.

Alternatively you could try a less expensive State...

Btw I think a lot of young couples inherit money or property in Australia. This always gets them on the ladder. We are behind because of immigration and the currency devaluation.

Edited by Bronwyn&Co
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We managed to make a tidy profit on our house in SA, which only just managed to cover the deposit, transfer duty and a few bits. Back to baked beans for us.

A friend of mine who made no money out of her house in SA and is now still renting is currently scraping together enough to pay for a deposit on a unit. They are a 5 person family so they won't live in the unit but will rent it out (use negative gearing to get the tax under control) and hopefully have a place to move into/sell when their kids have moved out of home.

We are busy painting and doing as much as we can without tradies to bring our 1930s bungalow with an 80s reno on the back into the 21st century. If you are in an industry where you get to meet and befriend tradies, then meet and befriend as many as you can. We have used a tradie friend who surfs with my husband to do sanding of some of our flooring and redo decking and thank goodness for mates rates! It is going to be a slow process.

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The theory of giving a $7 000 tax free grant from the Australian gov't to First Home Owners was great.

In practice, house prices went up $7 000 overnight and haven't come down, so the money basically went into the seller's pocket.

Australian house prices won't come down while we have a robust economy that is sucking in immigrants.

People coming to Australia need a roof over their head.

They look for a place, alongside the home grown Aussies, and often they have a big wad of cash to play with that young Australians don't have.

There is evidence now that 10% of people buying houses in Australia are Chinese investors, as since they are investors, they don't care if the driveway goes up, down, sideways or inside out . . . . . as long as the property sells for more than what was paid for it. Tenants can always be put in to put up with driveways.

Sydney prices went up over 15% last year, Melbourne up 11% and the rest of Australia's capital cities around 4%.

That basically shows the level of demand in Sydney and Melbourne and this is entirely due to new people coming in. Australian families are leaving Sydney in their droves. It's just too expensive for families. Great for singles.

Aussies that I've spoken to from around the country don't go there unless it's a career move . . . . and then, they are off and away to other parts of Australia once their two or three years is over with the company that asked them to go there.

House prices are only likely to come down when demand slows down. This will only occur when construction in Australia builds enough houses to cater for the backlog with all the immigrants that have come into Australia over the past few years.

The only other thing will be a downturn in the economy causing migration to grind to a halt because all the jobs will be taken up with local Australian labour, and prices generally tighten up for just about everything. People will be looking for bargains in that scenario.

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