Buying a House in Australia

Houses in Australia are more expensive in the city center than the suburbs. Sydney is the most expensive city with an average price of 350,000 Australian dollars, Melbourne comes right after Sydney and Adelaide is considered the cheapest city to purchase a home.

During the years before and after the Olympics, there was a significant increase in price especially in Sydney and Melbourne. However, despite that, Australia is still considered the cheapest in comparison to the rest of the western countries. Today the real estate market is stagnant and is even experiencing a small decrease.

In Australia it is very popular to purchase a home at an auction, especially in the state of Victoria, which accounts for a quarter of such transactions. The real estate agent who is responsible for the auction will generally quote a price lower than the market price in order to attract more buyers, who will benefit from a slightly lower percentage of commission of the transaction price. This method is generally better for the buyer whose time is valuable.

Fees: When purchasing a flat, one has to pay various fees, which are generally about one percent of the apartment value. They include money for stamps (2-5 percent), registering for land transaction (a set low amount), legal expenses and lawyers (1-2 percent), and various state taxes.

On average, the various fees add up to 5 percent of the property value, which is agreeably a relatively low price.

Mortgages: Banks are the main lenders, with a market share of over 80 percent. The remaining business is divided between insurance, credit and financial companies.

The main considerations that confront the purchaser are the amount of the loan, the payback period, and the interest rate, which today stands at 6-7 percent.

The standard loan in Australia is 70-95 percent of the home value for a period of 25 years, with the choice between a set interest or a variable one.

In light of the fierce competition in recent years, the plans have become more flexible, with the option for a low refund at the beginning of the lending period or variable repayments according to the ability of the lender.

You can view more information about mortgages and get an updated interest rate at this site. For further assistance with purchasing a home, you may visit the government website, and for details about a financial grant for purchasing a first home, you can look here.