For many of us, savings for a home deposit is no easy feat. In fact, it can take a number of years of putting away money and budgeting to get there. The truth is, you can take out a home loan with a deposit of as little as 5%. However, it generally comes with extra costs and could end up leaving you more out of pocket over the life of the loan. That’s why saving up more for a deposit of 20% of the property value (or more) is actually more likely to save you money in the long run. Here’s how: Simply put, the more you save as a home deposit the less you will have to borrow to buy a property. It ultimately reduces the percentage of the property value you pay interest on. For home loan customers with a 20% deposit, or 80% Loan to Value Ratio (LVR), lenders won’t charge Lenders Mortgage Insurance and may offer more competitive interest rates. Plus, the more money you have in your back pocket for a deposit, the easier it is to prove that you have the necessary savings. That way when it comes time to be approved for a loan, you have more chance of being given the green light.
2020 is set to be a positive year for the Australian property market, which will be a relief to home-owners and investors alike after a tough 2019. With the uncertainty of the election behind us and last year’s three RBA rate cuts finally flowing through to the market, we can expect a spike in value for Sydney and Melbourne, while most other cities will enjoy 3-5% growth.
For many Australians, buying a house is no easy feat. And with Uber Eats, Afterpay and Netflix all making headlines over the past year for potentially hurting our chances of securing a home loan, it seems like just about every little indulgence in the book could sink our dreams of owning a home.
Whether you’re taking things one step at a time or are building your portfolio, investing in property has the potential to secure your financial future. But that’s not to say it won’t cost you along the way - because aside from the hefty home loan deposit you’ll have to cough up, there are a number of expenses you’ll also need to budget for, from building inspections to council rates.
So, you're about to buy your first home and currently feel like a new parent that's in way over their head? Firstly, congratulations! Buying your first property is an incredible achievement and massive milestone in your life, which you should be super excited about.
Whether you’re upgrading or downsizing, there’s no denying the stress that comes with selling and moving house. And if there’s one thing on the mind of sellers, it’s the uncertainty that comes with not knowing how much your home will sell for.
The Builders Collective of Australia has called for a Royal Commission into the residential construction industry in Australia - and considering the news about the Mascot Towers apartment building recently, there’s no surprise.