Yarra Junction Common wisdom suggests that the best time to buy a property is as soon as you’re ready to take the plunge – but does this advice still apply in the middle of a global pandemic?
While we may not be living in ordinary times the reality is that pandemic or not we all need a place to live in, and the current environment might actually provide some unique opportunities for those hoping to get on the property ladder. Everybody’s circumstances are different, but if you’re in a stable financial position and want to break into the property market then there are plenty of good reasons to hit the pavement and see what’s available.
Here are just a few:
Lowest interest rates in history
Money has never been cheaper. The official cash rate currently stands at 0.25 per cent and doesn’t look like it will be going anywhere, anytime soon. There’s a lot of competition amongst banks and lenders right now, so shop around to find the best rate as even a small saving now could potentially save you thousands over the life of your loan.
You only need a small deposit if you’re a first-home buyer
Saving up the 20 per cent needed for a home loan deposit has long been a huge barrier for first-home buyers, but the introduction of the First Home Loan Deposit Scheme has made things a little easier for some. The scheme allows those eligible to get into the market with a deposit of as little as 5 per cent, and no need to pay expensive lenders mortgage insurance. There are only limited places available in the scheme each financial year though, so those hoping to use it need to get onto it quickly.
Government stimulus is on the table
There are some large financial incentives to get into the property market right now, particularly with the $25,000 HomeBuilder grant on offer for those looking to build or substantially renovate a home. While the HomeBuilder scheme has targeted a very limited market, it is the first time in history that the government has offered money to renovate so if you’re looking to build or buy a doer-upper it could be a good time to look at your options. There are a lot of first-home buyer incentives available too, from generous grants to stamp duty concessions, depending on what state you’re in.
There’s less competition
Every market in Australia is different right now, but in general investors seem to be taking a backseat, which is helping to make way for owner-occupiers. Do your research on the area you plan to buy in and if you find that buyer activity is lower than usual it could be your opportunity to get in for a very good price.
Prices will improve eventually
Nationally, property prices have slowed down since lockdowns and restrictions began in March, but things have been improving since. Predictions of major property crashes have largely been discounted, with most leading experts now forecasting minimal price falls before the property market sees a turnaround, with CBA’s economists predicting that property prices could start going up by as soon as the second half of 2021. It’s always possible that there will be some fluctuations along the way, but if you do your research, find a property in a good location and plan to hold onto it for the long term then you won’t regret buying in the current market.
