Buying Australian Property

When considering buying Australian property, there are many things to consider.

The lure of better weather, affordable housing and plenty of business opportunities makes buying Australian property a great idea for many people.

When it comes to purchasing property, the more research you do, the better off you will be. Property should be an investment which will continue to grow in value in the years to come. The following are a few tips to keep in mind when buying property.

Location 

It has often been said that the three most important things to consider when buying Australian property are location, location, and location. Keep in mind the weather factor when choosing a location.

For example, some areas of Australia are stiflingly hot during the summer months, while other places rain much more than you’d expect. In addition to weather, when selecting a location, consider the following:

  • Always look at the surrounding areas. What sort of infrastructures exist? How good or bad is the security in the area?
  • Be certain you are comfortable with the commute to work. Is the distance and time you will be on the road acceptable?
  • Look for facilities that may contribute to excessive, unwanted noise or other disturbances in the area.
  • Try to purchase property within a good school district. Even if you don’t have school-age children, strong school districts are often a top priority for many home buyers, and will increase the property value when it comes time to resell.

If the preferred area is too pricey for your budget, consider buying in an adjoining area.

Budget 

It is important to have a budget in mind. Be sure you can cover all the necessary costs of your purchase, including any extra costs if you will be considering a mortgage. Some of these costs include:

  • Land Transfer Registration Fee: This fee can vary between areas.
  • Legal Fees: These fees can range from 1-2% of your total cost, but can also vary between areas.
  • Pest and Building Inspections: Pest inspections can be relatively cheap, especially when compared to the cost of dealing with the problem after the property is purchased. A combined pest and building inspection can cost around $400, or more, depending on the size of the property. However, this expense in minimal when compared to the potential cost of dealing with a major building issue.
  • Stamp Duty: This is a tax levied on the purchase value of the property. Stamp duty is charged by the state and territory governments, so the amount you pay will depend on where you buy the property. Also, while stamp duty on mortgages has been abolished, you can expect to pay government charges to register your mortgage.
  • Strata Inspection: If you are looking into buying an apartment, it is advisable to commission a strata inspection which determines whether the building as a whole has had any structural problems.

One additional thing to bear in mind is that if you are planning on spending over six months out of the year living in Australia, then you are automatically liable for income tax.

Structural Aspects 

Check for any flaws which are easily visible when inspecting the property your are interested in, such as wall cracks, sagging gutters, or broken windows.  Upon inspection, you should also turn on the taps to check the water pressure of the property. If inspecting a potential house, also check that all toilets flush properly and that the base is free of any leaks.

Legal Issues 

If you are not an Australian citizen, or permanent resident, buying Australian property may be an issue depending on your reasons for coming to Australia. You will need to gain permission from the Foreign Investment Review Board (FIRB) before you can purchase a property. Generally, for well-intentioned, residents there is little barrier to purchasing property, and the FIRB is mainly to monitor huge investment purchases. Once you have applied, the FIRB will give you an answer within 40 days, however they do reserve the right to extend this to 130 in unusual circumstances.

Buying property is a big decision and can be overwhelming at times. Whether you are interested in investment property or are looking to purchase your dream home, keeping the above tips in mind will help the process go smoothly.

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Written by Staff Writers – Edited by Peter Spann

Peter Spann is a business coach, writer, presenter and investor.

© Copyright: 2014 Peter Spann – All rights reserved

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