What You Need To Know Before You Buy Your First Property

Are you looking to buy your first home in the beautiful Hunter Valley region?

We break down some key things you need to know before purchasing your first property.

A great time to buy

The property market across Australia is currently undergoing a price correction after the boom time of recent years. While areas across the Hunter region have seen significant price growth over the past three to five years, the downturn in the property markets in Sydney and Melbourne spooked a few buyers and there was a ripple effect from Newcastle’s property downturn.

The good news is that despite this, the Hunter Valley market remains one of the most buoyant, recording a median house price increase of 2.7 per cent to $435.636 in the year to January 2019, according to CoreLogic data. Units in the area dropped by 5.9 per cent to $312,536 during the same period.

According to data from realestate.com.au, Singleton houses are not quite back in line with the high we experienced in 2012 when the median house price hit $405,000 but are currently sitting at a healthy $375,000 at the end of July 2019.

First home buyers can feel confident that there are properties available at an entry-level price point, and that the market isn’t sinking, but the heat and competition have come out of it. This makes it a more level playing field and a great time to get into the market for the first time.

Discovering the area

We find buyers are attracted to our region for many reasons – some have grown up in this beautiful area and couldn’t imagine living anywhere else, while newcomers are looking for a change of pace and a more relaxed rural setting. Newcastle isn’t far away, and many commuters are drawn to the lifestyle appeal the Hunter can offer.

With a total population of 700,000, the Hunter Valley region and its townships are very diverse. There are a wide variety of property types, price entry points, amenities and industry drivers, depending on where you wish to buy and live.

Singleton, for example, is one of the larger towns and has a significant military base. Branxton, the northern gateway to the famous wine country, is a bustling service town with a medical centre, swimming school and art school. Broke is a quiet village nestled near the hills. And Pokolbin is less of a township but home to many wineries and plentiful tourist accommodation, as well as the popular Hunter Valley Gardens.

Current prices

According to data from realestate.com.au, the current median price for a home in Branxton as of July 2019 was $517,000. In Singleton, the median home price was $375,000 or $237,000 for units. This represents an affordable entry point for first home buyers.

Help for first home buyers

A variety of state and federal government measures aim to make it easier for first time home buyers to purchase their property.

If you’re a first home buyer and you’re buying or building a new home, you may qualify for a $10,000 grant under the First Home Owner Grant (New Homes) scheme. You’ll need to be buying a newly constructed home or a substantially renovated home that has a total value less than $600,000 or buying land to build a dwelling that combined will cost less than $750,000.

The Federal Government’s First Home Super Saver Scheme also allows first time home buyers to save their home deposit through their superannuation. And stamp duty exemptions may also apply, representing a considerable saving.

Your deposit and finances

As a general rule of thumb, lenders will want you to have a deposit that is at least five per cent of the property’s purchase price. However, if your deposit is less than 20% of the purchase price, you’ll also need to have Lender’s Mortgage Insurance (LMI), which protects the bank if you default on your loan. This can be added to your repayments, so be sure to factor it into what you can afford to spend.

Getting purchase ready

Before you begin viewing properties, first make sure you’re eligible for a loan and get your pre-approval in order. Bank lending conditions have tightened following the Banking Royal Commission and, while there are signs banks are relaxing some restrictions again now, it’s still more time consuming for first home buyers to get their loans approved than it once was.

It’s a good idea to contact a few lenders to see how much you can borrow and compare interest rates – which are at an all-time low – and loan conditions.

Future outlook

Despite overall weaker market conditions, the long-term outlook for buyers is positive, thanks to the Hunter Valley region’s relative affordability and proximity to Newcastle, combined with strong employment and current low-interest rates. If this is an area you’re interested in, now is a good time to buy.

If you are thinking about buying your first home in the Hunter Valley, our expert local team is happy to help. Contact us today for an obligation-free chat.

Article Written By

Subscribe for One Agency Lindy Harris Property News