As a first home buyer, or even a second or third home buyer, it can be difficult to understand the fluctuating property market. When is the best time to get into the market? What is considered a good interest rate? What kinds of rebates or grants do I have access to? Do these new rate cuts apply to me and is it even a good thing? There are so many questions, that sometimes it is difficult to know where to begin to look for information.
We can’t provide you with financial or investment advice; that is best left for your financial adviser or broker, but what we can do is provide you with the facts and the information that is publicly available and put it in a way that is easy to understand.
The bottom line is that there have been more interest rate cuts and the Australian Prudential Regulation Authority (APRA) have loosened the reigns, making it easier to secure a loan than it has been for quite some time. In fact, according to the Housing Industry Association, housing affordability in the June 2019 quarter has become more affordable than any other time in the last 20 years (read more here).
At Newenham, we’re here to help you find your perfect block of land for your dream home – whether it’s for your ‘right now’ home or your ‘forever’ home. If we’ve missed anything below or you need any financial advice, please chat to your financial advisor or broker. If you’re interested in finding out more about Newenham and the range of land available, please contact our Sales team here.
Do the new Reserve Bank cuts affect me?
Yes, they do affect you if you’re looking to purchase a home loan – and in quite a big way!
After two rounds of official rate cuts from the Reserve Bank (RBA), the big banks have passed on between 80-88% of these savings to you. At the moment, the ‘big four’ banks (that’s NAB, ANZ, Commonwealth Bank and Westpac) have come up with basic standard variable mortgage rates, which range from 4.92% to 4.98% – so there’s not a huge difference between them.
According to the ABC, this rate cut means deposit rates for savers will be trimmed as well (read more here).
In simple terms: So, what does all of this mean for you? The rate cuts mean that you can make considerable savings so now is a great time to apply for a loan and lock in a low rate.
What is APRA loosening and how will it help me buy?
Thanks to the new standards from the Australian Prudential Regulation Authority (APRA), it should now be easier than ever for home buyers to purchase.
These new standards mean that banks and other financial institutions have had their lending restrictions relaxed by APRA and they no longer need to apply a ‘stress test’ to see whether you can afford the minimum 7% interest rate on your residential home loan repayments that was previously required.
Now, with many banks now offering variable mortgage rates in the low-3%, many borrowers are likely to be tested at a rate below 6% per annum as banks decide whether you can afford to repay your loan, says the ABC (read more here).
In simple terms: What does this mean for you? This points to the fact that it should now be easier to secure a loan to purchase a home. Whether you need to borrow $188,000 for the perfect block of land or $555,400 for a remarkable home and land package, you’ll find it’s as simple as ABC. You may also be inspired to custom design your next home by visiting the homes in our Display Village.
What does the property market in Adelaide look like and should I buy now?
The property market can be a confusing and ever-changing beast; sometimes, it seems, only those in real estate or investment truly understand when it’s a buyer’s or seller’s market and when the perfect time to strike is.
Overall, according to Smart Company, Adelaide remains the most affordable capital city, but the first quarter of this year saw house values fall 0.5%. However, over the last 12 months Adelaide house values are 0.7% higher and unit values are 1.2% higher.
If you are buying your first property, now may be a terrific time for you to be looking around and determining what’s the best option for you. If you need help to decide where to buy or what to look for, read the “Complete Guide to Buying Land in South Australia”.
In simple terms: Historically, buying during this short-term downturn can be ideal if you have a deposit saved and are in the right financial situation. We recommend talking to a financial or investment advisor to see if now is the right time for you, personally, to buy.
Why should I purchase in the Adelaide Hills?
There’s an old piece of advice many a property purchaser will have heard over time; “buy the worst house on the best street”. This advice suggests that the location of the land may just be more important than the house on it.
While we absolutely acknowledge the importance and value of the dwelling you design and build, we also believe that location matters, even the location inside the suburb will have a large impact on your home’s value. Don’t forget the three important words when buying a home are location, location, and location.
So, before you buy land, do your homework on the location, look at the amenities and lifestyle important to you (and others – for future re-sale) such as parks, reserves, education options, community facilities/activites and public transport.
Great views and well-positioned homes may add significant enjoyment to living in your home as well as value to your investment over time. It is worth considering if you are happy with the view from your vacant land now, and then considering what the view may be in the future. At Newenham, we are retaining 98% of trees on site and planning hundreds more, so you’re sure to have a lovely outlook and many blocks have gorgeous views over the creek and Linear Park.
We offer a range of block sizes and street frontages at Newenham with varying benefits and orientations to help you find the perfect block for your needs. Blocks range in size from 600sqm to 2,385sqm but there are also precincts dedicated to smaller courtyard allotments for people who seek a low maintenance lifestyle. See our available blocks here.
For more information on Newenham or to book a personal tour, please contact our sales team on 0429 107 497 or visit our beautifully restored Sales & Information Centre, open 12 – 5pm every day at 164 Flaxley Road, Mount Barker.
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