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Buying a new house in Melbourne

So you've settled on Melbourne as the place you'd like to call home. Who can blame you? It's one of the world's most liveable cities and boasts a superb lifestyle for its diverse residents.

What steps come next?

Financially plan 

First, you'll need to financially plan. That means sitting down with an expert and working out your budget, which incorporates your current financial position (assets, income, job security, existing debts) and your life goals (for example, early retirement).

Lenders look for job stability (e.g. one year or more in your current role) and evidence of savings to give them confidence in your ability to meet your loan repayments over time. You'll also want to rid yourself of any excess debt wherever possible. Paying off outstanding credit card balances or other monies owing will be seen favourably when you apply for a loan.

You'll need to have a deposit saved before you can take the leap. How much will depend on your financial situation, the type and cost of the property you're interested in, and the deal you ultimately negotiate with your lender. It's safe to plan for a minimum of 10%.

Access concessions

There are special concessions available for first home buyers in Australia, and in Victoria specifically. You'll want to determine which of these you are eligible for, and take full advantage of them. 

A $10,000 First Home Owner Grant (FHOG) is available when you buy or build your first new home, providing it's valued at $750,000 or less and is less than five years old. 

If you're buying a house and land package, the $750,000 cap only applies to the land, giving you even more budget and room to move.

If you're buying in regional Victoria, you can access a larger grant of $20,000 (this includes some suburbs less than 30 minutes from Melbourne’s CBD - so it pays to widen your horizons).

Read more: What you need to know about the First Home Buyers Grant

Shop around

There's no one-size-fits-all when it comes to financing for your first property. Talk to a variety of lenders to find the best deal for you.

You should consider the interest rates on offer, how often the interest is calculated, the term of the loan (usually 25-30 years), whether you're able to make additional repayments (plus any conditions attached), ways you may want to offset your loan costs, and whether you can redraw funds from your account if you need to.

You'll also want to explore whether a fixed and variable interest rate option is best for you. A fixed rate mortgage offers more predictability around your repayments, but a variable rate may allow you greater flexibility, as rates tend to change over time. Make sure you ask your financial advisor about the best options for your situation and personal priorities.

Get pre-approved

When you find the perfect land or property, you want to be able to move relatively fast - before someone else snaps it up, or the price veers out of your reach.

Obtaining pre-approval before you even start your official house hunt is an important step, that gives you peace of mind, and the ability to pounce when you find 'the one'. Review your financial paperwork with your bank or lender and they'll be able to issue you with conditional approval for borrowing up to a certain amount. 

Choose your location

With pre-approval in tow, you can start searching in earnest. Consider the four As a formula to help guide which suburb you should buy in - affordability, amenities, atmosphere and asset.

Is the price in the right range? Is there access to transport, schools, services and shopping?

Is there a welcoming community and appealing lifestyle?

And lastly, what other infrastructure is planned around the area? 

The latter is a guide to future growth prospects, and can give you confidence about your investment appreciating value over time.

Read more: The benefits of building versus buying established

Choose your new home

What sort of property beckons to you? Established? Or a new build?

If you're buying a brand new home, you get to choose your design from scratch, including the colour schemes and features you'd like included.

List out your non-negotiable requirements, and those things you're happy to compromise on. 

Consider your style preferences, how many bedrooms, bathrooms and car spots you need (now - and in the future), whether you want single or double storey, and the type of materials that appeal you - both inside and outside of the home.

Don't forget these questions to ask your builder.

Seal the deal

Once you've found your ideal location and property, the final steps of the process kick in - making your purchase offer and finalising the paperwork. 

With Tick Homes, construction will start within 12 weeks (from title release) of land settlement, and you have a guaranteed build time of 18 weeks.

Once everything is in the final stages you'll do a final inspection and settlement - then comes the fun of moving in!

The Tick Homes team make this process as easy as possible for our customers. We keep you in the loop the entire time, including the important stuff like eligibility for grants and concessions. Even how the right block of land can maximise your investment. A home is on the biggest decisions you’ll ever make, and our mission is to look after you while we get you that first home feeling.

Get in touch if you want to chat, or drop by our Tick Experience Centre in Melbourne (the coffee is great and there's no pressure to do anything but explore).

About the author

Darren Mehl is Chief Operating Officer for Resimax Group and its house of brands. An industry stalwart, he has held senior roles at Metricon and Carlisle Homes. Darren has worked closely in the first home buyer market, delivering initiatives that assist this complex and competitive demographic. A passionate advocate for customer-centric business, Darren is experienced in all facets of property.

Darren Mehl

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