Walkabout Posted May 16, 2014 Report Share Posted May 16, 2014 (edited) Hi all, Probably a really daft question, but we are trying to get our head around what we need to do to buy a house here and I wondered if anyone had and advice that they could share? for example the purchase price that is advertised - is this what you pay? do you negotiate as you would in the UK or is that not the done thing here? Also does anyone know about the LMI - if you need to take it out initially (because you have less than the 20% deposit) but know you can reduce your debt in the next year or so do you keep paying the LMI (assuming you have put it on the loan value which I believe is possible) or does that stop once you drop below the 20% value? Finally I am assuming that you need to get a mortgage offer in principle before offering on a house, is that true or can you just offer without this in place? Any help or suggestions gratefully received! (PS forgot to say we are looking at established houses rather then new builds at the moment) Edited May 16, 2014 by Walkabout Quote Link to comment Share on other sites More sharing options...
ali Posted May 16, 2014 Report Share Posted May 16, 2014 We bought in the boom so to be honest houses were going for the asking price at the time. You can offer lower but don't be surprised if they say no. Once they accept your offer it is classed as entering the contract - no one can come in and gazump you, but I don't believe it's easier for you to withdraw either. Houses go through very quickly here too. Quote Link to comment Share on other sites More sharing options...
Nutnudger Posted May 16, 2014 Report Share Posted May 16, 2014 We bought an established house last August. We offered below the asking price and it was accepted. We made the offer subject to finance, so we had 21 days to get the finance in place and then 21 days to settlement. The offer is also subject to building inspection and pest inspection. LMI is added to the life of your loan. If you need LMI on the loan, you won't be able to get the loan in principal before an offer, as this is subject to the price of the purchase. Quote Link to comment Share on other sites More sharing options...
verystormy Posted May 16, 2014 Report Share Posted May 16, 2014 Yes, you can make offers the same as the uk. It is better if you have a mortgage in principle before the offer, but not essential - we didn't on the purchase of our land (we are building). I do recommend using a broker for the mortgage as they can ensure you get the best deal - we got a deal that wasnt even advertised even though it is with a big bank. Quote Link to comment Share on other sites More sharing options...
SJT Posted May 17, 2014 Report Share Posted May 17, 2014 Agree with VS, we went with a broker, and he was brilliant. We have just brought a house here this week and offered below the asking price, there was negotiation and we still got the house for under the asking price, but the one we lost out on before went way over the asking price. It is worth asking. Good luck with the next step. Quote Link to comment Share on other sites More sharing options...
Nikkis2000 Posted May 17, 2014 Report Share Posted May 17, 2014 We're using a broker too. We're also getting pre- approval this time to make sure we're in a good position when we offer Quote Link to comment Share on other sites More sharing options...
Walkabout Posted May 17, 2014 Author Report Share Posted May 17, 2014 Thanks all for your replies, next question then, can you recommend a broker, we are NOR? is there anything that we should look for specifically when finding one? Very excited for your SJT on having your offer accepted on a house, do you have dates yet? I think I read in another post of yours that the process of making the offer on the house was different as well, is it just a case of calling the agent and making your offer or is there more to it than that? Thank you again! Quote Link to comment Share on other sites More sharing options...
Druid Posted May 17, 2014 Report Share Posted May 17, 2014 We just went straight to ANZ as the wife gets a substantial discount with them as she works for COP, a mortgage broker was not going to beat that, it might be worth checking with your bank depending on where you work, we got a decision in principle immediately, unfortunately MLI is a premium that is lumped onto the top of your mortgage if you don't have a 20% deposit and there's no getting away from it! you owe the bank that money for the life of that mortgage! then there's the dreaded stamp duty! which I think has just changed with the state budget, it used to be $500k, we decided to build, firstly you can build the same house for substantially less, you get a bigger break on stamp duty & you get $10k FHOG, you only pay interest on a stepped mortgage during the build, the day you move in your house has gone up in value $75-100k, if you buy established you are paying top dollar and then there's the renovations to consider, we put an offer in last winter on a established house in Harrisdale, the asking price was $550k, we offered the asking price of $550k on Saturday, come Monday I had heard nothing, I called the agent and was told the house sold for $600k, I had been excluded from the bidding war as I was the lowest offer, before that offer I enquired about another house on the market for $600k, I went to a local Aussie mortgage broker, the conversation ended when she said to proceed with an offer I would need $56k cash in my bank account. Quote Link to comment Share on other sites More sharing options...
Nikkis2000 Posted May 17, 2014 Report Share Posted May 17, 2014 Holly Mackie from mortgage express based in Joondalup. PM me if you want her details Quote Link to comment Share on other sites More sharing options...
Guest Guest6235 Posted May 17, 2014 Report Share Posted May 17, 2014 Wow another hurdle to cross, just when your so far along and the doubts are starting to go, something else crops up, they don't make it easy. 20% LMI on top of the value of the property is some figure to try and come up with without adding on to the mortgage. Quote Link to comment Share on other sites More sharing options...
Lou8670 Posted May 17, 2014 Report Share Posted May 17, 2014 Wow another hurdle to cross, just when your so far along and the doubts are starting to go, something else crops up, they don't make it easy. 20% LMI on top of the value of the property is some figure to try and come up with without adding on to the mortgage. Keefo, I think the LMI is only payable if you don't have 20% deposit. Quote Link to comment Share on other sites More sharing options...
Guest Guest6235 Posted May 17, 2014 Report Share Posted May 17, 2014 (edited) Yeah I gathered that. You maybe lucky but after all the emigration costs etc I'm guessing not everyone will have 80ķ + deposits to put down. They go on in the UK about it being hard for young people etc to get on the property ladder god knows how mine would get on it over there. Edited May 17, 2014 by Guest6235 Quote Link to comment Share on other sites More sharing options...
Lou8670 Posted May 17, 2014 Report Share Posted May 17, 2014 Yeah I gathered that. You maybe lucky but after all the emigration costs etc I'm guessing not everyone will have 80ķ + deposits to put down. Yeh, we're 'lucky' in that housing costs were astronomical in Jersey but it's provided us a fair bit of equity to bring to Oz. I understand everyone's not in the same position. Of course the best approach maybe to rent for a year of two, figure out where you want to live and during that time save a deposit. You might after all want to build which is cheaper and there are some great house and land packages available. Quote Link to comment Share on other sites More sharing options...
verystormy Posted May 17, 2014 Report Share Posted May 17, 2014 The LMI is not an issue as it can be added to the mortgage. We only had a 10% deposit and so had to pay LMI. It wasn't too bad. Building a new place can be a good financial idea than buying an existing house due to the way the payments work and that here, new builds are worth more. So from a investment view it makes sense. Our build is costing $550k including the land. The local agents estimate it will be valued at $650k once complete. It does mean that you pay rent while paying mortgage, but the majority of th mortgage doesn't kick in till you have the keys. Quote Link to comment Share on other sites More sharing options...
Druid Posted May 17, 2014 Report Share Posted May 17, 2014 Wow another hurdle to cross, just when your so far along and the doubts are starting to go, something else crops up, they don't make it easy. 20% LMI on top of the value of the property is some figure to try and come up with without adding on to the mortgage. LMI can be added to your mortgage, but it all depends on the % of your deposit! they work some numbers and come up with a percentage! basically you have to come up with about a 5% deposit based on your mortgage+MLI Quote Link to comment Share on other sites More sharing options...
Nikkis2000 Posted May 17, 2014 Report Share Posted May 17, 2014 And some lenders won't add it to the loan ie NAB but a good broker will tell you who does and doesn't Quote Link to comment Share on other sites More sharing options...
Guest Guest6235 Posted May 17, 2014 Report Share Posted May 17, 2014 (edited) LMI can be added to your mortgage, but it all depends on the % of your deposit! they work some numbers and come up with a percentage! basically you have to come up with about a 5% deposit based on your mortgage+MLI LMI is lenders mortgage insurance....What is the MLI? If I come cap in hand will that help ha ha After a terrible nights sleep with the 8 month old I read all this during the night to compound it all, not the best. Edited May 17, 2014 by Guest6235 Quote Link to comment Share on other sites More sharing options...
Druid Posted May 17, 2014 Report Share Posted May 17, 2014 LMI is lenders mortgage insurance....What is the MLI? If I come cap in hand will that help ha ha After a terrible nights sleep with the 8 month old I read all this during the night to compound it all, not the best. MLI, LMI Lenders Mortgage Insurance, it's all so confusing but it still costs you a fortune Quote Link to comment Share on other sites More sharing options...
Druid Posted May 17, 2014 Report Share Posted May 17, 2014 (edited) LMI can be added to your mortgage, but it all depends on the % of your deposit! they work some numbers and come up with a percentage! basically you have to come up with about a 5% deposit based on your mortgage+MLI So I guess NAB don't do many first time mortgages then, unless you win the lottery, where you going to find a minimum 5% deposit, $16k stamp duty & $26k LMI for your average house here in Perth Edited May 17, 2014 by Druid Quote Link to comment Share on other sites More sharing options...
Guest Guest6235 Posted May 17, 2014 Report Share Posted May 17, 2014 MLI, LMI Lenders Mortgage Insurance, it's all so confusing but it still costs you a fortune Cheers Druid You're not wrong, it makes just paying stamp duty in the UK look like nothing, even the amount we paid for the house we sold last year.....in readiness for this. !!! Quote Link to comment Share on other sites More sharing options...
SJT Posted May 17, 2014 Report Share Posted May 17, 2014 Hi Walkabout It is so different and it seemed like not hard work, but a waste of time when just at the offering stage, but now we are through that, its good to know no one is going to change their mind. We saw a house a couple of weeks ago and the agent contacted us to say they had received offer and he had got a vibe off of us that we were interested, hubby said we were interested. Real estate agent then said he needed to come and do some paperwork, this was on a Sunday morning, so two hours later he popped in, it took about hour to go through all the paperwork, as obviously this was the first time we had questions. As there were mutliple offers going in he said to put our first and final offer in, which we did, he then rang three hours later asked could we go a further $35,000, which we said no and he said oh well someone else is getting the property then. We then viewed another house on mothers day, which we fell in love with and to be honest if I could I would have put an offer in there and then but the agent had done the viewing as a special as we could not do the home open the day before, and he did say if we were interested to contact him on the Mon, as he was going home to do his mother day celebrations. We then left it until the Tuesday morning to put an offer in, again the agent came out that night to do the paperwork, which was to put in our offer, put conditions on like us getting our finance in place in 15 business days, termite and building reports to be done as well and also our settlement date, which we thought we would be cheeky as our landlord has decided we cannot break our lease (they are not our original landlords, they brought the house whilst we where living here and we were always told as the new owners were going to be moving in themselves we could break the lease a couple of months early, and they have now decided that we cant move out before hand, I have to say that did make me cross as we had house opens over the christmas period whilst family where staying here) that we would ask for settlement on 28 Aug. The next day the agent rang and said the owner wanted an extra $15,000 but was happy with our other terms, we then settled on an extra $7,500, which is still a lot under the asking from price. I did not realise that at all stages, like when the owner put forward the extra $15,000 that had been added to the contract and he had initialled by the figure, so that night when the agent brought the paperwork back, it had all the offers on there, all crossed out, with the relevant signatures, so when I signed my initials by the new figure, the contract became legally binding. Which is a good thing as no one can pull out that easy now and no one can come forward with a better offer. The real estate agents do a lot more work here than back in the UK. Apparently when we have five days to settlement, we then go back for a final inspection where we make sure everything works, like light bulbs, oven, electrical appliances. To say I am still excited is an understatement I cannot believe we have brought our first ozzie home, and its 500m from the beach, 250m from a great park, and not far from everything else. When the agent sent the contract he congratulated us on the purchase of our beachside townhouse. Quote Link to comment Share on other sites More sharing options...
Guest Guest6235 Posted May 17, 2014 Report Share Posted May 17, 2014 The LMI is not an issue as it can be added to the mortgage. We only had a 10% deposit and so had to pay LMI. It wasn't too bad. Building a new place can be a good financial idea than buying an existing house due to the way the payments work and that here, new builds are worth more. So from a investment view it makes sense. Our build is costing $550k including the land. The local agents estimate it will be valued at $650k once complete. It does mean that you pay rent while paying mortgage, but the majority of th mortgage doesn't kick in till you have the keys. Thanks VS That must be hard for the regular (don't worry not calling you regular ha) family to pay rent and some mortgage per month I'm guessing. What sort of % of mortgage do you have to pay whilst it gets built. Quote Link to comment Share on other sites More sharing options...
Druid Posted May 17, 2014 Report Share Posted May 17, 2014 Thanks VS That must be hard for the regular (don't worry not calling you regular ha) family to pay rent and some mortgage per month I'm guessing. What sort of % of mortgage do you have to pay whilst it gets built. The government does help out first home buyers considerably, they have a mortgage in place with all the big banks called 'Key Start', there are lots of restrictions, for a $3k deposit, you can get a key start mortgage for up to roughly $475k, you will struggle to build for that here in a Perth but it is doable, another problem is you have to be earning under $140k as a couple, but your home has to be liveable from day one, so the builder has to do all floors & window coverings etc, you can't pay into the scheme, you can't up the deposit and the interest rate is slightly higher, you only have to pay about $50 month in interest back to the bank while they are building, and as you are under the $500k you don't pay any stamp duty, the LMI us still added to your mortgage. We looked into it, but it didn't suit us, also a lot of the popular new estates put all the key start mortgages into a lottery for the land release, so it hit & miss what block you get, not such a good system really. We doing the regular mortgage now, 5% deposit + LMI + stamp duty less the $10k FHOG, the bank only charges interest on a stepped mortgage until completion in about 12 months, so with a tight budget paying rent & paying an interest only mortgage is not that bad. Just wish the house in blighty would sell, that would give us all the money we needed to make this a whole lot easier Quote Link to comment Share on other sites More sharing options...
bensdad Posted May 18, 2014 Report Share Posted May 18, 2014 We did our own build same scenario 5% deposit + insurance etc all up cost us just over $440,000 been moved in a year got house valued now have over $100k equity. We used mortgage gallery for broker they were very good. Quote Link to comment Share on other sites More sharing options...
abc Posted May 18, 2014 Report Share Posted May 18, 2014 Thanks all for your replies, next question then, can you recommend a broker, we are NOR? is there anything that we should look for specifically when finding one? Very excited for your SJT on having your offer accepted on a house, do you have dates yet? I think I read in another post of yours that the process of making the offer on the house was different as well, is it just a case of calling the agent and making your offer or is there more to it than that? Thank you again! Pm me and I can give you details of the best broker bar none in Perth! Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.