Moving from renting to home ownership is a dream many Perth renters hold close. With rising property prices and an increasingly competitive market, it can feel like a daunting leap. But with strategic planning and practical advice, the journey becomes much more manageable. Here are five expert tips to guide you from being a renter to a homeowner in Perth.
1. Assess Your Financial Health
The first step toward homeownership is understanding your financial position.
- Savings and Debts: Ensure you have enough savings to cover a deposit and additional costs such as stamp duty, legal fees, and moving expenses. Also, try to reduce or eliminate existing debts.
- Rental Spend: From your current rental spend you can calculate how much of a mortgage that will cover. E.g. $26000 a year in rent covers a $430,000 mortgage on an interest-only basis of 6%.
- Credit Score: A higher credit score can help you secure better mortgage rates. Check your credit report and address any issues.
- Income Stability: Lenders prefer borrowers with a steady income. If you’re considering changing jobs, it may be worth waiting until after securing your loan.
2. Set a Realistic Budget and Savings Goal
A clear understanding of your budget is crucial.
- Estimate Costs: Calculate how much you can afford to borrow based on your current income and expenses. Don’t forget to factor in ongoing costs like insurance and maintenance.
- Deposit Size: Aim to save at least 20% of the property’s value to avoid Lenders Mortgage Insurance (LMI).
- Saving Strategies: Automate your savings, reduce discretionary spending, and consider extra work or a side hustle to boost your deposit.
3. Research the Perth Property Market
Knowledge is power when it comes to property hunting.
- Location Matters: Identify suburbs that align with your lifestyle, work, and family needs. Look for growth potential and amenities.
- Market Trends: Stay up-to-date with market trends and property values in your target areas. Understanding market conditions can help with negotiating a better deal.
- Attend Inspections: Explore different types of properties by attending inspections and auctions. This will help you refine your preferences.
4. Secure Pre-Approval and Seek Expert Advice
Pre-approval gives you a clear indication of your borrowing capacity.
- Mortgage Pre-Approval: Apply for pre-approval from a lender to understand your borrowing limit and expedite the buying process.
- Financial Advisors and Brokers: Seek advice from financial advisors or mortgage brokers who understand the Perth market and can help tailor a plan to your needs.
- Legal Advice: A solicitor or conveyancer can ensure your contracts are in order and help you navigate the legalities.
5. Start the House-Hunting Journey
Once your finances are in order, it’s time to begin the hunt.
- Property Search Platforms: Use platforms like realestate.com.au to find properties that meet your criteria.
- Inspections and Offers: Shortlist potential properties and attend inspections. Make offers that reflect your budget and the market value.
- Building and Pest Inspections: Before finalising the deal, arrange for building and pest inspections to avoid costly surprises down the track.
6. Putting in an offer (Talk to us first though)
- This is the scary part and having done your research will make you much more confident in your approach and your offers. You can get sales data of properties around your area from the Valuer Generals Office so you know exactly what people have recently paid for similar properties. This is better thane hearsay information.
- Getting assistance from an experienced family member or third party professional can help mitigate the sales prowess of a real estate agent good at talking up the price and the fact that everyone wants to buy this property.
- Finding out about the seller’s motivations can give you an idea of urgency as well and improve your bargaining position. The real estate agent won’t give you this information too easily. Divorce, death, distress, debt, health problems and other factors can mean settling at a lower offer is more convenient to the seller. Talking to the neighbours is a good start. Knock on their door and say, we are thinking about buying next door. You can find out if you will like your neighbours too and that’s important.
- It’s a great idea to get plenty of advice or get some help here if it’s your first time putting in an offer.
7. Choose Cockburn Conveyancing as Your Settlement Agent
- You’ll want a great settlement agent on your side to explain all steps of the process and what to include in the offer contract BEFORE you put in your offer.
- The wording of conditions is important and we can give you exact wordings which will help protect your interests more than the sellers. From Pest inspections, building inspections, electrical and plumbing.
- We handle all your ID checks and paperwork and keep you informed along the way
- Getting a quote from out team ahead of the offer process can give you more confidence as to what to expect.
Get into your own home today
Transitioning from renting to homeownership in Perth may be challenging, but with the right strategy, you can achieve your dream. Start by assessing your finances, setting a realistic budget, and understanding the local market. With expert advice and perseverance, you’ll be well on your way to finding a place to call your own.
Reach out to our team for information about what’s involved in property purchasing and advice to understand property transfer costs. If you are going to be subject to foreign ownership clauses because you or your spouse is from overseas and has not passed all the Australian criteria. We can help inform you of what your status is here.
Its a quick phone call or email and you will be well informed by our expert term of Perth conveyancers and settlement agents.
