by Jye Smith
We are in very different times when it comes to property as there are many options out there to assist you in your next move in the property market.
Whether you are looking to purchase your first property, invest in another, renovate or build, there are many incentives in the marketplace currently that can support you.
These incentives are coming from Government, record low interest rates, lender offers and grants, to name a few. We have outlined some examples of what is currently available below.
What if you are buying your first house?
- First Home Loan Deposit Scheme: This allows first home buyers to get into a property with as little as a 5% deposit and no Lenders Mortgage Insurance (LMI), saving you up to $23,000 in LMI premiums. As part of the 2020-21 Federal Budget, the Australian Government has committed an additional 10,000 First Home Loan Deposit Scheme places for the 2020-21 financial year (date for release to be confirmed).
- Lender-specific offers: Lenders are offering various specials to first home buyers, such as $1 mortgage insurance if you contribute a 15% deposit, saving you up to $8,000 in LMI premiums. Other lenders are providing discounts to the LMI premium.
- Stamp duty exemptions: These vary from state-to-state. In New South Wales for example, some or all the stamp duty incurred on property purchases/new builds up to $1,000,000 can be waived. Other conditions apply depending on whether the property is existing, brand new or under construction.
- New Home Grant: For first home buyers, this incentive provides $10,000 for new home purchases/builds under $750,000 in NSW. Variations exist in other states.
What if you are building or renovating?
- Homebuilder allowance: This is an incentive from the Government to stimulate the building and construction industry by providing $25,000 cash bonus when you sign up for a new build or significant home renovation. There are different factors which affect eligibility in this scheme, and it is for a limited time.
- First home buyer incentives: As noted above.
What if you want to buy an investment property?
- Record low interest rates: Repayments on additional funds to fuel an investment property purchase are lower than ever. This, coupled with the current demand for residential rental properties, may see the rental income covering the loan repayments.
- Leverage off your existing property: Doing this may avoid the need to pay LMI premiums on an investment purchase or the requirement for a cash deposit. You may be able to unlock equity from your existing property to negate the need for either of these.
All in all, the lenders are all finding their niches to work with and are working with borrowers to assess the risks they are happy to accept. At the same time the Government is striving to keep the economy turning by providing areas of incentive and stimulus. Together these factors are creating an interesting range of property investment options.
How can we help?
If you would like to discuss what’s available to you or to understand how much you can afford to borrow, do not hesitate to get in touch with Jye Smith using the form below for a free, no-obligation consultation.