How To Buy A House In A Hot Market

Published by Otto Dargan on September 29, 2021

The Australian housing market is a hotspot right now. Absorption rates are high, real-estate prices are soaring and inventory levels are low – all indicating a seller’s market.

Plenty of buyers remain undeterred. Nearly 598,000 house and unit sales took place across Australia over the year ending August 2021, CoreLogic data shows. This was the largest number of annual sales since 2004 and a 42% increase over the previous 12-month period. Domestic demand has risen drastically, from low levels.

A look at consumer savings accounts explains why. The average rate of household savings has increased, giving potential buyers more money for deposits and mortgage repayments. Add the availability of government incentives such as stamp duty concessions and deposit guarantees, and the surge in property investment is no surprise. There has been a recent swell of new listings across major cities as well, fuelling even more demand.

Become An Informed Buyer

Yes, it’s all great news for sellers. But there are still ways to put yourself in an advantageous position as a buyer. Here are some steps you can take to come out ahead when you’re looking to buy a house in a hot market:

1. Get Your Pre-Approval Ready

Avoid missing out on your dream listing while applying for a mortgage. A pre-approval generally signals to the seller you’re serious about securing the property. Once your pre-approval is verified, you know approximately how much you can borrow, thus you can feel confident making offers.
Learn more about how to apply for a pre-approval.

2. Find The Right Buyer’s Agent

A hot market makes a buyer’s agent a necessity. A buyer’s agent alerts you to new listings and will even do initial inspections before bringing you along to look at only the best options. First-home buyers often find the process of securing a property complex. A buyer’s agent will make it easier by directing you to trusted lenders and providing you with in-depth knowledge of the property market.
If you would like help securing your first property, then please call us on 1300 889 743 or complete our free assessment form today.

3. Check For Waived LMI And Other Associated Costs

One of the biggest hindrances to buying a property is the associated costs beyond the mortgage repayments. Getting a break on items such as Lenders Mortgage Insurance can help. You may qualify for waived LMI if you are a first-time buyer by applying for a nationwide scheme designed to help new property owners enter the market with deposits as little as 5% without paying LMI. It is important to check offers from various lenders to minimise your costs.

4. Do Your Own Research and Evaluation

Don’t get caught up in the frenzy. Remember, a property evaluation is only a starting point. Take your time and do thorough market research within the area of the properties that pique your interest. Be sure to consider the location, look for market movements, and check auction clearance rates and discounts to asking prices at sale. Perhaps most important of all, learn the going prices from local agents, to determine a fair market value.
Home Loan Experts can provide you with this data and lists of local property sales. Please complete our free assessment form to find out how else we can help you find the best deal on a home loan.

5. Contract Review

Remember that an informed decision is your greatest asset. With the help of your agent or a mortgage broker, review the contract early so that when entering negotiations you can make a better decision.

6. Patience And Persistence

Take the time to evaluate your needs and wants. Making a large investment without due diligence on your part would be a potentially costly mistake. With the help of a broker, you can make wise decisions, even in a highly competitive market.
Contact one of our mortgage specialists at 1300 889 743 or enquire online for a full assessment.

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