Next steps for land buyers
With government homebuilding grants on offer and interest rates at a record low, many agree there’s never been better incentives for first-time buyers to enter the property market.
Real Estate Institute of Western Australia data shows many Western Australians have decided to snap up financial subsidies and begin a homebuilding journey, with land sales the strongest they have been since 2009.
Residential Building WA General Manager Jim Ilias said buyers who were planning to purchase their first block should act fast before soaring demand caused substantial price spikes.
He said once a titled land parcel was secured, buyers should meet with their bank or broker to find out how much money they could borrow, and request a list of documents required to better prepare for the first meeting.
Once a budget has been set from a financial provider, Mr Ilias said prospective homeowners should think deeply about their wishes while maximising the value of their new asset.
“How many bedrooms and bathrooms do you need?,” he said.
“And is zoning of the master bedroom away from the minor bedrooms wanted?
“Do you love coastal style? Or are cubist forms more to your liking? Or are you just wishing for a solution to suit your modern lifestyle needs?
“One of the biggest considerations first homebuyers should make when building their first home is whether it will be a good investment.
“You’re putting a lot of money into buying your first piece of land and building your first home, so it is important to determine you will be creating a good future investment.”
Mr Ilias said two-storey homes generally secured sellers a better return on investment due to their appealing street presence and their ability to maximise internal living space with often-desired separation between bedrooms and entertaining areas.
He also said Perth block sizes had reduced over the years to accommodate a desire to live near the CBD, so those who had bought smaller land parcels might also benefit from a two-storey design to increase liveability and space.
Mr Ilias encouraged those who had purchased land and were considering their build options to consider what they needed now, and what they might need from their new home into the future.
“If you are a first homebuyer you should be realistic about budget, and keep in mind that you’re likely to upsize down the track and you don’t need to include all the features you would want in your forever home,” he said.
People who intend to leverage government grants are also encouraged to consider the offering as bonus money separate from budgets, in case financial lenders do not include the cash when assessing financing.
This article was originally published by The West Australian and can be viewed in full here.
14 Jul 2020