I'm looking to buy and I know a few of you guys own your own place so I figured I'd try and draw apon some of your opinons and exerience.

When you went under conract with a place, did you have to put down a deposit? and if so did you get it back if the contract fell through?

Where did you go for your home loan? and with what options and how did it work out for you?

Also does anyone here live in Rochedale South and have an idea what the area is like, crime, transport etc?

and lastly any other opinons, suggestions and warnings you might have for a first timer

due to the torrens title system of land registration in queensland you do not own or have exclusive right to the property until it is registered with the lands office after settlement. therefore even if you sign a contract with a vendor they can stil sell to another purchasor (for a higher price usually) in a practice called gazzumping. so my advice is to make sure settlement happens quickly if you have your heart set on that house.

also

- get pre-approved finance up to a certain limit. that way you can bid at an auction (as their sales are unconditional) or you can arrange a fast settelement otherwise (because you do not have to include the "subject to finance" clause).

- make sure you have at least 20% cash deposit available. this way you avoid mortgage insurance which is mandatory for loans with less than 20% deposit and is just a cheap grab by banks for more fees.

- make sure you buy the house in your own name and not with a bitch girlfriend who will bleed you dry when she inevitably leaves you and you want to buy the house off her to stay put.

last edited by infi at 09:38:55 02/May/06

Infi I think your first paragraph is wrong in Queensland.

It is like that in NSW but not here. We have different rules in QLD, which makes what you said incorrect.

So WetWired don’t freak out about what Infi has said. (I’m assuming you are buying in QLD, from your forum location)

oh and pray that the reserve didn't raise the cash rate today or your wallet is goign to be even emptier after buying property.

jubs i would bet my _house_ on it (having studied land law at law school).

see also the DNR website or the Land Title Act 1994 xD

last edited by infi at 11:53:34 02/May/06

You only really need a 5% deposit and they can add the Mortgage Insurance to the loan, sure its a cheap grab by "mortgage insurer" but it will allow you to get the extra money you may need to get the home you want, with the mortgage insurance added to the loan / taken from the loan proceeds you pay it off over a number of years anyway. Plus, if the property is an ivnstment the mortgage insurance would possibly be tax deductible. Purchasing costs are the other thing that will cost you, and they can add up to a fair bit...

yeah you are able to buy a house with an insanely low deposit, but as in a trap for the wary, this can add up to a lot of extra money on top of (loan x interest rate) I suppose that's the thing to be carefule of.

With the deposit, you might be able to organise with the real estate agent to have say $1000 payable on acceptance of offer, with the remainder payable within 24 hours after the finance date. You cuold even look to have a deposit bond organised where by you get a company like "deposit power" to issue a bond guarantee where you dont have to initially give the deposit over. With regards to the deposit amount, you could probably organise to make it an amount sufficient enoguh to cover the real estate agenets commission, they would generally be happy with an arragement like that...

Infi I appreciate that you have studied and are willing to bet your house, but I suggest you check your study books. The term “gazzumping” is derived from an industry term brought about what you said happening in NSW not in QLD.

As an e.g

Just say it is one day before settlement and everything is unconditional the vendor cannot pull out of the contract cause they feel like it for what ever reasons.

im with jubs, you cant just pull out of the contract when someone offers a better price, once all is unconditional, its just that... unconditional... unless the buyer asks for an extension on settlement or cannot settle on time, that would be one scenario whereby they could terminate i guess...

Whatever you do, just don't borrow right up the your "possible" borrowing limit as presented by the bank/morgtage brokers. Because if any increased in interest rate you're gonna be suffering - badly. Set the price you can realistically afford to borrow (and more importanly afford to repay with interest rate fluctuation & live as well) then find the house that matched your price.

You know your own finacial situation best so don't let them tell you how much you can borrow etc, set that limit yourself. It's worth sitting down and do your household financial just to see your situation, don't forget the credit card limit they count that into your monthly "debt" as well - even if you don't reach your limit (at least they did for me).

After you've worked out your finances and how much you're comfortable with, then look for the properties that match your situation. It's a big commitment, you do not want to f*** it up so take your time with it. Always read very carefully the doco you sign. You should always get a good lawyer that you trust to read the doco before you sign, do not cave in with the pressure to sign on the spot - 1st rule do not sign if you're not sure.

Pretty common sense stuff really but it's easy to forget when you got your heart set on the house your want. Just stay objective and you'd be ok.

Good luck with it.

last edited by Opec at 12:10:41 02/May/06

gazzumping occurs when a house is on the market and the agent takes a contract signed by the purchasor for the asking price to the vendor. the purchasor has a reasonable expectation that this will be accepted, however quite often other purchasors are in the wings sniffing around and an unethical agent may say to purchasor no 2 that they could get the property if they added 10k to the price.

this is highly unethical but can happen because an agent's commission is derived from a % of the purchase price, thus the higher he/she sells the property for the more money they make.

but you are right once a property goes unconditional the contract is enforceable and can be sued on in the supreme court for specific performance.

Hey Wetwired,
I used to live in Rochedale South and our house has been on the market for 3 months and just went unconditional last week :( - Awesome suburb - I used to live in Sunnybank and my insurance on the Forester dropped dramatically - its a very low crimerate and used to be made up of oldies mostly, but new familys are now moving to the area..
Also its good having the M3 so close and springwood has the busway which is great if u work in the city.




last edited by Slydog at 12:40:42 02/May/06

Infi with reference to the way you have written your initial comments in your first post I was commenting.

You are telling WetWired to have a fast settlement because of “gazzumping”. This would maybe be reasonable advice had he lived in NSW. Because in NSW they can pull out of the contract at the last second, which could mean you will be screwed. (Cause you had to wait 1 or 2 months etc)

However in QLD when you sign a contract the vendor normally signs reasonably fast (Few days) because the 5 day cooling off period does not start until they have signed the contract. Once the vendor has signed, they cannot pull out unless the buyer breaks a clause in the contract.

So therefore WetWired has nothing to fear from “gazzumping”.

Also in QLD “gazzumping” tends to be the vendor not the Agent. You ring them tell them you have an offer and they go and ring the 3 other Agents to see if they can get more.

Yeah we've sorted out our finances and they place we're looking at is at the lower end of our price range which is good

Slydog did you used to play q2/ra2?

I think I lanned at your Sunnybank house like very many years ago? I think we played some q3 cause it just came out or something?

I remember you had a little dog?

yeah we went through Mortgage Choice, we decided on Credit Union Australia

conveyancying (solicitors) - this includes your title/land searches etc mine came up to $800 or so

We have a friend who can do it for us for mates rates

Other up front cost like building/pest inspections etc.

My father is a builder and can do the inspection for me :)

Seeing your a first home owner the $7K grant should cover most of this and leave you with enough change to buy a couch.

Yeah we'll be getting a little extra to buy some stuff we'll need for wherever we get, like a lawnmower, new fridge

less than 85% of first home buyers get their first home loan application rejected, so don't worry if you fail.

work out how much you can repay at a 1-2% higher interest rate, they are going to go up. If they don't go up immediately at least you are paying off your home quicker

don't let them factor in the first home owners grant to the loan amount, use this to help pay for all that s*** you forgot about once you actually move in.

the market is on the down, with people realising that rental property isn't a good investment. offer significantly under what they are after.

Remember also that their realestate agent is your friend, the after tax commission he makes on the sale is not SIGNIFICANTLY influenced by the sale price, the most important thing for him is that it happens quickly so he can move on to his next property and commission.

i got my loan through a broker. it's roughly 3/4 fixed, 1/4 line of credit. I didn't have to put down a deposit when making initial offer. My biggest trouble with the whole sale process was MY d******* lawyers. I made clear to them that i wanted to move in at a certain date, and they let the settlement slip by a weekend, cause once you are at that stage supposedly there is nothing they can do and the seller has full control.

Banks cut home loan rates

BANKS are cutting interest rates on home loans as they strive to win business and the competition is hurting St George Bank as its profit margins narrow.
St George Bank chief financial officer Steve McKerihan said there was some aggressive pricing in the industry as competition for mortgages, business loans and deposits was intense.

Fingers crossed this happens!

cool, we are picking up the keys to our first home on thursday this week!

i cant believe how easy it has been

i cannot recommend getting a mortgage broker ENOUGH
would have been much trickier without one

good time to be going for a loan atm, as banks are giving away money (u can get loans without any deposit, and use rent paid as a savings plan)

would be madness to do it this way, but it can be done!

we have bought in salisbury and im totally surpised at how low the repayments are (not much more than rent)

moving in this saturday!

phoaw congrats Spook old man, finally took the plunge eh? :)

Hey Jubs u old codger,
Yeah thats me... how have things been going for u these days?
Still in real estate hey??

cannot recommend getting a mortgage broker ENOUGH
would have been much trickier without one

Truer words have never been spoken.

and they are FREE

we tried a couple until we found a guy who was giving us the whole story

the first MB we spoke to spent the whole nite telling us that we could have whatever we wanted to borrow, from whatever bank, but didnt tell us any of the cots and how mortgage insurance works

were much happier with the guy from mortgage choice ( ithink, ill check with petal)

showed us costs depending on how much deposit we used, and we worked out whether it was better to pay car out, or keep car debt and keep maanged funds

was extremely helpful and has probably saved us THOUSANDS

Yeh Sly I have been well. Still kicking along doing the same stuff. Been a long time now.

How have you been? Still doing IT stuff?

PS If im an old codger now, you must be getting on :)

less than 85% of first home buyers get their first home loan application rejected

What? This doesn't mean much to me - 84% is less than 85%, and that's a s***eload of rejections :/

Thanks for the nfo Spooks - I too am planning to buy my 1st house (in Salisbury too) as soon as I get back from this power station commissioning work in NZ...

sorry, i changed the wording and f***ed it up

it's "less than 15% of first home buyers get accepted for their first loan." and i heard it the other day when the figures came out for housing approvals and home loans for December quarter.

that may have been the case, but ud had to be a complete deads*** to not be able to get a loan in teh current climate

the last 6 months all banks (and mortgage insuring agencies) have relaxed their rules for giving out loans

i heard an ad on the radio this morning for Zap Home Loans for 106 percent
no deposit, all legals are paid for and you get to keep the 7grand from teh government!

HOW COULD YOU GO WRONG>!!>>!?!??!?!

HOW COULD YOU GO WRONG>!!>>!?!??!?!

I hope that's a joke mister.

Anyway my golden rules would be:
1) Work out your repayments at least 1% higher than current market rate and start paying that from the beginning.
2) Make your first payment on day of settlement, not at the end of the 1st month (obvioulsy make one then too)
3) Make sure your loan has a redraw facility so you can pay extra funds in and take out when needed. Obviously any funds in there reduce the interest payable.
4) Budget for ongoing house owning costs such as rates and building insuance, probably ~2.5 - 3.0k per year ($50+ per week). Budget these funds every week (or whenever you get paid) and pay this on top of your loan payment in to loan account then withdraw when due - see 3.
5) If you do the whole 'live on interest free credit card and pay at end of month' really do your sums, it's very easy to over spend and go backwards, review it regualry ie: monthly
6) Don't be too afraid to borrow to your limit if it's the house and area you want. You want to be happy with what you have because in the end you live there and it will cost you s***loads to live there so you might aswell be happy about it. See 1.


I dunno about the whole mortgage broker thing. Sounds like the gerneral concensus is they are OK. But look into it yourself just so you know what's going on.

My tips on homeloan:
1) Lowest interest rate possible based on comparison rates - this includes set-up and on-going fees etc.
2) The loan has 'Cash Back' or redraw facility, at least 1 per month with no charge.
3) Consider doing all your banking with the one group as this makes money managing and transfering heaps easier.
4) Make sure you can do all this s*** on the web and their site is good (okay getting picky here but ANZ suck and Suncorp rock).

It's kind of a balance for all the above in regards to loans and I think most are pretty competitive in their respective segments.

We have Suncorp 'Back-to-Basics' and have been happy all round.

What was going to be a short post ended up kinda long.

Hope this helps.

Oh and take your time to find the right house.

last edited by mission at 19:50:55 02/May/06

(of course it was a joke matey)

i guess u have bought in annerely from the sounds of your advice mission

we would have loved to be able to buy here, but were a few years late in the market :(

I went through a broker, twice actually when I refinanced my current place. I had my pick of the offers and wasn't knocked back anywhere. Brokers make it hella easy!

good time to be going for a loan atm, as banks are giving away money (u can get loans without any deposit, and use rent paid as a savings plan)

can you explain this, bit of a noob is all and am interested in the subject.

in the old days, to get a loan u needed cash in the bank and you needed to have demonstrated that you could save money (not just get a lump sum and put it in the bank)

in the last 6 months however, less people were getting loans and property was worth more, so banks are trying to get people borrowing more cash, so they have relaxed a lot of their rules

effectively now, u can get a loan with no savings and no demonstration of being able to save, say if you have been paying rent (regularly paying it, it works out as effectively demonstrating that you can make repayments)

obviously, you have to be careful, but if you can be disciplined, u could call up a mortgage broker (or go see Zapp) with no savings and get a home loan just using the 7grand the government gives you

in the old days, you wouldnt have even bothered trying, coz you would have been laughed at

We bought at Rochedale South ~14 months ago now. Don't regret it a bit - it's a great suburb with good access to everything. Was living at Annerley before buying, and my insurance rates dropped a lot, so I guess that's a pretty good indication of the theft rates.

Zap are just reselling First Permanent loans whom are a Devine subsiduary.

Their 106% finance rocks if you NEED to use that facility, but you're gonna be paying 7% interest at the least. First Permanent will help you out too if you get into trouble because its bad PR to loan people 106% of the value then default them. In fact First Permanent who write all the loans for the Devine packages you see on TV (no repayments, rent paid while you build etc) have NEVER had a default since the launch of the product in 1993. Seriously impressive record. They are owned by Devine so most of their business is Devine homes, but the product is so good they have decided to put it to the open market.

I know all this because I worked at Devine for 18 months and only quit a few weeks ago, I dont reccomend the Devine houses, but the finance packages are market leaders in the no deposit field. Most people simply refinance onto acheaper rate in 12 months anyway with a bank, it's simply a tool to get people into the property market who otherwise wouldn't be able to.

Spook I'm a bit confused. How are your repayments cheaper than rent?

What were you renting a mansion before?

Even if your repayments aren't much more than rent, you still have the other 'house owning' costs to pay such as rates and biulding insurance, not to mention any repairs etc.

Our minimum repayments are less than what it would cost us to rent the same house, we bought 5 years ago, but add on the extra costs and it would work out a bit more.

But at least you have something to show for your money other than just rental receipts and paying off some one else's place.

(not much more than rent)

that said, where i live now has rediculously low rent ($230 for a large 3 bedroom queenslander with garage in annerley, comes with free rats and doors that stick)

repayments on our house are less than 1000 bux a fortnite*

when u factor in what we were putting into savings ontop of what we pay for rent and what we charge the bro in law for rent, its not that much more than when we were renting

* obviously thats the minimum repayment

does anyone know much about buying apartments and body corporate fee's and general bulls*** that comes with them??

Depends on the size of the place groydis. In my townhouse complex I pay under $400 every 3 months but we have 2 groundskeepers, 2 swimming pools etc. It does sort of suck with townhouses/apartments because you get hit with BC fee's as well as rate bills, but then last year we had all the townhouses painted, and the entire complex done for termites and it all came out of the Body Corporate funds.

RBA raises interest rates

in relation to apartments, i run a body corporate for a 3 townhouse setup because i own one of them. my dad is chairman of a body corp for a 60 unit highrise which has professiaonl managers.

you are charged two fees every year: an administration fee for current year operating expenses (like rates, insurance, maintenance etc) and a sinking fund fee for future capital expenditure or repairs that may be needed.

it is regulated by queensland law and fair trading oversees it.

Thats spot on there infi.

Houses in Australia are over priced (when compared to everywhere else and based against annual average earnings)... question is will they correct themselves or not.

Of course they won't. Demand keeps going up and there's only so much *desirable* land/property.

Also I remember that study you're referring to which shows australian housing as expensive compared to the rest of the world by comparing proportion of income spent on it. I thought it didn't take into account renting vs. buying from memory (which would have a large impact as proportionally more australians buy property vs. renting it compared to rest of world).. but I'd need to check that out my memory is pretty retarded sometimes.

aussie housing prices have been distorted by the first home owners grant and also due to an enormous period of economic growth.

people think inflation is under control but when you consider that real estate prices are excluded from CPI calcs inflation has really been out of control since 2000 and interest rates should have been raised far earlier to slow this down... but then the same battlers having trouble affording houses now would be complaining that high interest rates make it too hard to afford repayments.

which would you prefer, high house prices or high intrest rates?

I think the rate rise wasn't called for. The biggest impact on inflation atm is oil prices. Oil prices rising is a supply side issue. Increasing the cash rate is a demand side management policy. It won't be effective at combatting supply side driven inflation. It's just gonna make life a whole lot harder for basically everyone.

Though you have a point re: housing prices. But the rate rise isn't justifiable right now imo.

Houses in Australia are over priced (when compared to everywhere else and based against annual average earnings)... question is will they correct themselves or not.

thats why I just bought a two bedroom investment unit in dubai. Beautiful place and you'd be amazed at the price.

so part of body corporate fees goes towards rates, do your own rates go ontop of that? or am i missing something here?

Body corporate fee's are seperate from council rate bills, you have to pay both. Rate bills cover stuff like water usage, rubbish removal etc. Body Corp fee's cover stuff in the complex/apartment building you're in such as maintenance, cleaning and upkeep of the site, as well as insurance of the building (you only need contents insurance).

hey spidz, when was the last time you were there? When i looked at that i noticed that the rental market was really oversaturated and rental prices were really low for nice houses which i found strange ... i guess it could change down the track with all the push they are doing for tourism etc

Of course they won't. Demand keeps going up and there's only so much *desirable* land/property.

270 grand for a 2 bedroom apartment on a busy road in Zillmere ?
300 grand for a 1 storey 3 bedroom in Deception Bay ?

Neither is particularly desirable.

And you aren't going to get 300 a week rent on that house or 270 a week rent on the unit so they aren't wise investments for an investor.

by desirable I meant it in the sense that the supply of land that people want to live on. I added it in there so people wouldn't go "but australia has heaps of land u idiot so why is supply fixed lolz". Sure they might not be desirable in the sense that you don't want to live there, but if they are going for those prices then the sellers obviously expect someone to fork it out. The supply of property is fixed over the short-medium term, demand keeps increasing. The trend price is only going to increase. Over the short term though they should fall with the rise in the cash rate.

My plan is to buy four identical houses and then upgrade them into a hotel.

u sir are destined for insane riches.

hey spidz, when was the last time you were there? When i looked at that i noticed that the rental market was really oversaturated and rental prices were really low for nice houses which i found strange ... i guess it could change down the track with all the push they are doing for tourism

yep you're right. I'm doing short-term holiday leasing with mine but am hoping to sign up a corporate lease deal where an engineering firm uses it for staff on assignment over there.

we just settled today!

how exciting

is it worth buying an old crappy house, renovating it, and selling it off these days? or just renovating it so you can live in it i guess. would it work out cheaper?

dad is thinking of buying a house here.

he wants to sell the piece of land in iraq, but i'm telling him don't do it, it would be worth a fair bit oneday. land and house prices are getting alot more expensive over there.

BigZub: definitely, especially if the majority of the renovating is DIY. Crappy houses can be had for reasonable prices in high demand areas.

People will pay extra for renovations like plush decks, a big kitchen with stainless steel, and spacious airy bathrooms.

taggs

I fail to see why you place so much importance on the supply-side dynamics of the oil price being the driving focus behind the RBAs decision to raise the cash rate.

thats a wholly simplistic and hollow view. check the breakdown of those cpi figures. it isn't all just energy.

Suhaib: I'd imagine whatever land he owns in iraq atm wil be worth a hell of alot more money in 5 years or 10 years than now...

yeah, i'm thinking of buying it off him and building apartments on it. Just the current situation doesn't help at all :\. its decent size too, like a hectare.

considering he got it for free. the perks of being a university president back in saddams days.

see saddam the scum isn't all that bad :P


last edited by BigZub at 23:09:10 04/May/06

Suhaib....arent you like 20-21? How can you afford to 1. Buy land and 2. build apartments?

What are you doing that im not? :'(

1.well for a start houses/ land aren't as expensive as you think over there. Cheap labour, cheap material. (everything is slowly getting more expensive tho)

2. i'm good at saving money ;)

3. i'm half arab half black

and a few other things.

What are you doing that im not? :'(

you can stop wasting your money on rubbish. you know what i'm talking about matt :)


last edited by BigZub at 23:59:50 04/May/06

suhaib is half arab and half black. that means he will steal vcr's to get the money to build his apartment, and then nuke you when you try to stop him

Suhaib makes money out of selling drugs to fund terrorism.

i only terrorise you obes.

If i wanted to be a scum i would have become a drug dealer. cos thats what drug dealers are they are low life scums.