Tips to Buy Your First Home in Melbourne in 2022?

Buying a first-home in Melbourne can seem like a challenging task. It can be difficult to find out the perfect place or location for a new abode. The capital of Victoria offers great amenities, modern-age apartments, million dollar mansions, Victorian homes, cottages and much more in the inner as well as outer suburbs.

Finding the most suitable dwelling in one of the most developed cities require proper research, property market knowledge and an estimated budget.

With a bit of house market, you can make a confident and well-informed home buying decision. To help you out on your property investment journey, we have gathered a complete guide that will make things easy for you:

1. Know Whether You are Ready or Not!

Are you ready to buy a new home in the hotspots of Melbourne, Victoria? Do not forget to ask this question to yourself. If you are sure and confident, then begin the process of assessing your work condition.

One of the crucial things lending companies look for is job security. Higher job security allows lenders to approve a loan without any stress.  So, assess your current condition, buying potential and other factors before making the final decision.

2.  Check your Finances and Budget

It is important to find out how much you can borrow funds from the bank. There are numerous factors that influence the borrowing amount. You should talk to a financial advisor in Melbourne, Victoria for proper guidance. They can help you find out what your monthly living expenses are.

Creating an estimated budget will make it easy for you to determine how much you can afford for your new abode. Make sure you apply for a credit file when applying for a home loan. Clear all your debts and outstanding payments if you don’t the best loan with the lowest interest rate.

3. The Cost of Buying in Melbourne

According to experienced property investors, it is vital to consider the cost of buying a home in Melbourne for your peace of mind:

Legal Fees

Do not forget the cost of legal services when buying a new home in Victoria. It completely depends on the property you are buying in a particular location. It is good to put aside at least $1200 to $3000 for  legal services.

Stamp Duty

It completely depends on the state you live in. The stamp duty is applies to the buying value of the home. You can calculate the amount of stamp duty online for better clarity.

Save at least a 10 to 12 per cent deposit to secure a home loan.

You may need additional costs when buying an investment property. It includes insurance, maintenance, property management, water rates, council, land tax, body corporate fees and much more.  It is good to consider market tips for a long run property investment in Melbourne if you want to buy your dream home.

Be ready to pay LMI if you are borrowing over 80 per cent of your home’s purchase price. The insurance will be paid to protect the lender if you don’t make your repayments. You will need to pay fees for applications, valuations and settlements.

It doesn’t matter how much you saved up a deposit, you need to borrow funds from banks to purchase your dream home. Look for potential finance options and understand the terms and conditions of a finance agreement before signing it. You should search for the following features of the home loan:

• Interest rate
• Loan term
• Options to redraw funds
• Additional repayments options
• The procedure of calculating the interest rate.

You can also read the home buying guide if you want to buy your first home in Melbourne.

Banks and other lending companies offer two different types of interest rate:

Fixed: It is perfect for those who are excellent at budgeting.

Variable: It is bit risky because the interest rate changes as the market change.

Make sure you secure pre-approval for a home loan before you buy a house in Melbourne. After getting it approved, you will know exactly how much you can lend money from the bank.