Thinking about buying a new home or buying your first one? In this article, we’ll talk about buying a property in New South Wales (NSW), Australia. We won’t focus on the additional issues that come with purchasing investment, holiday and other property that won’t be used as your main residence.
When purchasing a home in NSW, you will most likely get one of the following types:
- You will be given extensive rights of use and exclusion over the entire property. This is generally what people expect as an owner of freestanding house.
- Same with freehold, except that the buyer’s right is time limited based on talks with the vendor (owner).
- Strata Title: Typically applies to townhouses and apartments. This gives you rights over the space within the townhouse or apartment, plus any backyard or balcony space that comes with the property title.
- Community Title. Typically works in combination with strata title and lets you have rights over communal land in a development along with everyone else invested in the development.
NSW houses for sale revolve around any of these property types, so it all comes down to you or your family’s preferences.
What about conveyancing?
Conveyancing is simply the process of transferring one’s ownership of a house to another, typically from a vendor to the purchaser. This process is assisted by a property lawyer, a duly licensed conveyancer, and yourself. Lawyers and conveyancers have fidelity and indemnity insurance cover that lets you recover costs if they make errors.
There are also do-it-yourself conveyancing kits that you can use if you don’t want to engage a conveyancer or lawyer, but the risk doing it on your own is that if you make errors, you won’t be able to recover your costs.
Financing for a new home. When you start budgeting for your property purchase, you will need to include all applicable costs such as inspection reports, stamp duty, and conveyancing costs. You will also need to work out how much you can afford every week in mortgage repayments. Also, you need to finance the ongoing expenses such as insurance, council rates, water, maintenance, and strata levies.
Lenders mortgage Insurance. Leading institutions such as banks usually loan up to 80% of the property’s value. Other banks will let you borrow a greater amount if you purchase a Lenders Mortgage Insurance, which is a one-off payment added to your home loan.
Getting assistance with your home loan. Borrowing money can be troublesome at times. If you’re having a hard time borrowing from a home loan provider, often times a family or friendly member can guarantee your loan. This means that if you default (hopefully not) on your mortgage and the lender cannot recover the money from you, they will be able to get the borrowed money from your guarantor.
First home owners grant. If you are a first time home-buyer, and you’re purchasing a new home, you may be eligible for a first home owners grant. NSW has this policy, allowing you to choose from houses for sale in NSW. You can get more information on the NSW Office State Revenue website.