Buying Your First Investment Property in New South Wales
February 3, 2020
It’s not a secret that the Australian property market has become difficult to break in to. If If you’re a young person interested in property investment, you may be saving for a deposit for more than a decade. Assuming you’ve assessed your current situation, you understand the risks, and you’re not letting your emotions affect your decision making, it’s helpful to understand your current options. So, we’re going to give you some tips on how to get into the property market as quickly as possible.
Stamp 1. Family Guarantor
Typically, banks would like to a see a 20% deposit before approving a home loan. However, if this isn’t possible, one potential option is to use a family member’s equity in their own property to guarantee your home loan. If a close family member is comfortable with this risk, this is by far the easiest method to get your foot in the door.
2. Start Saving and Investing NOW
Are you 18? 50? Start saving now. It’s never too early or too late to start putting money away for your home deposit! Want to plan your finances on a long-term basis with regular deposits? Check out ASIC’s Compound Interest Calculator.
3. First Home Owners Grant
In New South Wales, the state government will provide first home buyers of new homes worth $750,000 or less with a $10,000 grant. Some lenders are happy to accept these grants as payment towards a deposit! Moreover, there are generous stamp duty concessions for first home buyers as well, making it easier to save for your deposit.
4. Find a Low Deposit Home Loan
Some Australian lenders provide low deposit home loans, meaning you’ll only need 5% of the purchase price of the home for a loan. However, this does not include other upfront costs such as Stamp Duty and Lenders Mortgage Insurance (LMI), which can be expensive.
Keep in mind that a home deposit is only one aspect that lenders consider when apply for a home loan. Other factors, including savings, income, and spending habits may also affect your ability to secure a home loan.
Let’s Build Something
As we prepare to tokenize development projects, we would like to keep you informed on future developments and investment opportunities. In the following weeks, you will be informed of launch dates, potential projects, and more! Just sign up to our email list below.