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23 August, 2016
Buying property is a serious affair, and expats interested in becoming home owners in foreign countries should be prepared to face even more complex purchasing procedure. If you're considering to buy a property in Australia, this post is for you. The process varies from state to state, but here are some general 5 steps that apply everywhere in Australia.
1. Establish your budget
An expat who has been granted permanent residency in Australia can benefit from a First Home Owner's Grant, which entitles eligible candidates to a single grant of AUD 7,000 to serve as a payment put toward their first property.It's a nice touch, but most of the time prospective property owners won't be able to buy a property up front. At this point, expats will usually consider taking a loan – calculate your budget to learn how much you need and prepare for the reality of the Australian mortgage.
2. How to get a mortgage in Australia and survive
At least a couple of factors like your visa and credit rating will affect the ease with which you can get a mortgage. You might need to apply to the Foreign Investment Review Board (FIRB) for permission to buy real estate – they assess each case individually.Recognized lenders usually lend expats up to 80 percent of the value of a property. If you need to cover more, consult with a specialist mortgage broker.
Expats on a Doctor's working visa, or people on spousal visas can borrow an amount corresponding to even 90-95 percent of the property value. Expats won't be offered a different interest rates or pay higher charges on their mortgage just because of their visa status. However, prepare for fewer lenders willing to give you a mortgage.
3. Choosing the location for your property
When picking the location for your home, you'll want the property to retain its value. Research trends in housing prices and learn what the median prices in areas you're interested in are. This is how you can easily check whether you can afford to look for properties in that location.Most expats are unfamiliar with Australia, so it's a good idea to initially rent a property and get more time to make this serious decision. Sure, resale value is important, but you don't want to sacrifice the quality of your life for a prospect of future sale.
4. House-hunting in Australia
Selecting the location of your future property is a key step. Once you're sure about it, you'll be looking for just the right property in the area. As you can imagine, this can become very time-consuming.
You can save time by searching platforms like OpenAgent to hire an experienced real estate agent who knows the area and is able to estimate what the property is worth or negotiate a good deal for you.
5. Buying the property
If you're buying from a private seller, the formal purchasing process will involve mediation through the estate agent who manages the property and acts as your go-between with the seller. This is where you need a real estate agent as well.Once you agree on a price, you'll have legal sale documents drawn up. It's a good idea to have a solicitor guide you through the process as the documents vary from state to state. If you sign an unconditional or an exchange contract without having your financing formally approved, you risk not being able to back out of it.When buying property in Australia, you'll need to pay Stamp Duty on the purchase price. First time buyers may be exempt from this rule, but that depends on the state – check this and make sure to incorporate Stamp Duty when making your final offer.
The Australian property market is very dynamic and offers lots of properties with good market value. Follow these 5 steps and you can be sure that buying a property in Australia is pure pleasure.
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