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Top tips for first home buyers in Australia

Read the best tips for buying your first home, or compare your loan options right now.

Buying your first property can be an overwhelming process. Read on to take the fear out of buying your first home, or compare home loan options in the table below.

Nine tips for first home buyers

Boost your confidence and your home loan know-how with the following nine tips:

1. Make sure you're actually eligible for a home loan.

Before you dig too deeply into the process, check that you actually qualify for a home loan. Contact several lenders to get an idea of how much money you can borrow. This will give you a realistic understanding of what (and where) you can actually buy. Try out Finder's home loan eligibility calculator to get a better idea.

2. Research all your home loan options.

The home loan market is complex and competitive. You need to compare as many loans as possible to make sure you're getting the right rate and features. You also need to know what types of home loans are available. From variable to fixed rate loans, interest-only and investment loans, there are many different types of mortgages. Finding the type of loan that matches your needs is crucial.

3. Sort out your debt.

If you're already in debt you might find it harder to get a home loan approved, or you may not be able to borrow quite as much. Focus on paying off any large debts you may have before you apply for a home loan, especially high-interest debts. Consider combining several debts into one if you can. But note that some debts, such as university HECS debt, are far less troubling than, say, credit card debt.

4. Get a good-sized deposit together.

The bigger your deposit the more you can borrow. And you can apply for loans with lower interest rates. While it's possible to take out a loan with a 5 or 10% deposit, you will have to pay lenders mortgage insurance if you have less than a 20% deposit.

The ultimate home loan deposit savings guide

5. Crunch all your costs (and calculate your concessions).

Home buying incurs many surprise expenses. Budget for removalist costs, stamp duty, application and registration fees and pest inspection reports. You should also see if you're eligible for a first homeowners grant or stamp duty concessions. If you're eligible, you'll save thousands of dollars.

6. Position yourself for success.

If you've fallen in love with a particular property, other buyers probably have too. Having all your paperwork and deposit together, plus pre-approval puts you in a much better position to snap up your dream home when you find it.

7. Caveat emptor (home buyers, beware!).

Imagine buying a car without checking the mileage or the brakes, and then having it break down as soon as you buy it. A home is likely the largest purchase you'll ever make, and ultimately you as the buyer are responsible for making sure you're getting a quality property for the price you're paying. Get building and pest inspections so you're not stuck with a collapsing, termite-infested disaster. Examine the quality of the property's fittings and construction as best you can. And if there are obvious repairs needed (and you're OK with that) make sure you get a quote for repairs and factor that into your budget.

8. Get expert help.

There are professionals who can help you with every step of the home buying process. Buyers agents can help you with the whole buying process, while a mortgage broker can navigate the loan market if you can't. Make sure you have a licensed conveyancer look over your contract thoroughly.

9. Figure out your home buying strategy

If you want the ease of moving into a home which is already landscaped and liveable then you may consider buying an established home. Buying a home which has already been built has the advantage of being in an established area with established streets, footpaths, nearby parks and, importantly, shops and transport. You could even buy an older home and carry out some improvements.

If you would prefer to put your own stamp on your home from the beginning then you might want to build your first home from the ground up. Choosing the block and the neighbourhood, the street and the orientation, choosing the plan and the builder, then choosing everything from the doorknobs to the paint colours, the pavers to the curtains and everything in between. If you are building your own home, you will need to apply for a construction loan to draw down on funds.

Episode 19 of the finder.com.au Money Podcast spoke to Taj Singh from First Home Buyers Australia about first home buyer tips

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Compare mortgages for first home buyers

Rates last updated December 15th, 2018
$
Loan purpose
Offset account
Loan type
Repayment type
Your filter criteria do not match any product
Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment Short Description
3.59%
3.61%
$0
$0 p.a.
90%
Get a low interest rate loan with no ongoing fees. Plus you can make extra repayments and free redraw online. Available with just a 10% deposit.
3.59%
3.59%
$0
$0 p.a.
80%
Enjoy flexible repayments, a redraw facility and the ability to split your loan. Plus, pay no application or ongoing fees.
3.57%
3.58%
$0
$0 p.a.
80%
Get a very low interest rate and avoid big fees. Apply online for full approval in under 30 minutes and add a 100% offset account for $10 a month.
3.64%
3.66%
$0
$0 p.a.
80%
A simple mortgage with a competitive interest rate and no application or monthly fees. Borrow up to $2000000 from a convenient online lender.
3.54%
3.57%
$0
$0 p.a.
80%
A competitive variable essentials rate mortgage targeting first home buyers. Requires a 20% deposit.
3.54%
3.58%
$0
$0 p.a.
80%
Get a competitive rate, save on fees and access a 100% offset account plus redraw facility. $900 cashback offer.
3.69%
4.86%
$0
$395 p.a.
90%
Special discounted rate for first home buyers. Start your home buying journey with 2 years of fixed repayments at a competitive rate plus package discounts. Available with a 10% deposit.
3.75%
4.72%
$0
$299 p.a.
95%
Owner-occupiers can enjoy a discounted fixed rate, a rate lock feature and the ability to make additional repayments.
3.87%
3.91%
$600
$0 p.a.
95%
A home loan with no ongoing fee and a redraw facility that you can borrow up to 95% LVR.
3.68%
3.82%
$0
$10 monthly ($120 p.a.)
80%
Earn Velocity Frequent Flyer Points with this mortgage to spend on flights and more (for a limited time, subject to eligibility requirements). Redraw facility available on this variable rate home loan. Competitive interest rate.
3.59%
3.63%
$495
$0 p.a.
90%
Get a low variable interest rate and buy a property with just a 10% deposit. 100% offset account attached.
3.83%
3.67%
$250
$0 p.a.
80%
A low 3 year fixed rate for home buyers. Add a 100% offset account with a $10 monthly fee.
3.74%
4.01%
$395
$0 p.a.
80%
A competitive fixed interest rate product with no ongoing bank fees.
3.74%
3.74%
$0
$0 p.a.
80%
A basic owner-occupier home loan with a low variable rate that requires a 20% deposit.
3.87%
3.91%
$0
$10 monthly ($120 p.a.)
90%
Get Velocity Frequent Flyer Points at settlement, monthly and every three years, plus the option to make up to $10,000 a year in extra repayments.
3.68%
3.70%
$0
$0 p.a.
80%
A competitive variable rate mortgage for owner occupiers that comes with a no fee debit card with a $5,000 limit.
4.29%
4.26%
$0
$0 p.a.
95%
A competitive 3-year fixed rate loan with a high max insured LVR.
3.79%
3.79%
$0
$0 p.a.
80%
Access an offset account and pay no application or ongoing fees on this special variable rate for owner-occupiers.
3.85%
3.85%
$0
$0 p.a.
80%
Low fee loan with extra repayments. Pay no application and ongoing fees and take advantage of split and redraw options.
3.59%
4.14%
$395
$0 p.a.
80%
A one year fixed rate offer with no ongoing bank fees.
3.59%
3.58%
$0
$0 p.a.
80%
Apply online and get fast approval for this fixed rate, low-fee loan with redraw facilities. Add a 100% offset account for a small fee.
3.72%
3.74%
$0
$0 p.a.
80%
Save on interest by taking advantage of a 100% offset account along with no ongoing fees or application fees.
3.69%
4.12%
$0
$395 p.a.
80%
Unlock a range of savings with this competitive package home loan offer. Offset account and redraw facility included.
3.74%
4.13%
$0
$349 p.a.
90%
Get a sharp rate plus package discounts and a 100% offset account.
3.89%
4.27%
$0
$395 p.a.
80%
New borrowers or refinancers can get a discounted rate with this package loan.
3.64%
3.59%
$0
$0 p.a.
80%
Fast, 100% online application process. Very limited fees. Optional offset account (with fee).
3.84%
3.84%
$0
$0 p.a.
80%
Pay no application or ongoing fees and get access to a free redraw facility with this innovative online lender.
4.17%
4.21%
$600
$0 p.a.
95%
Variable rate home loan from one of the big 4 banks. Available with just a 5% deposit.
3.88%
4.51%
$0
$395 p.a.
90%
Lock in a very competitive 2 year rate and get package discounts on your credit card and offset account. $1,500 cashback available (conditions apply).
3.62%
3.62%
$0
$0 p.a.
95%
A low deposit mortgage with a competitive rate and plenty of flexibility. QLD residents only. Eligible borrowers can get a 15% discount on home and contents insurance for the life of their loan.
3.89%
5.05%
$595
$0 p.a.
90%
Investors can take advantage of a short term fixed rate with no application or ongoing fees.
3.87%
3.92%
$600
$0 p.a.
95%
A low deposit mortgage for aspiring home owners. Fees are low and you can make extra repayments.
4.39%
4.78%
$0
$395 p.a.
95%
A low deposit package home loan. Combine your loan to get discounts on your interest rate and other NAB financial products.

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Marc Terrano

Marc Terrano is a Lead Publisher at finder. He's been writing and publishing personal finance content for over five years and loves to help Australians get a better deal.

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Home Loan Offers

Important Information*
UBank UHomeLoan Variable Rate - Discount offer for Owner Occupiers, P&I Borrowing over $200,000

Take advantage of a low-fee mortgage with a special interest rate of just 3.59% p.a. and a 3.59% p.a. comparison rate.

HSBC Home Value Loan - (Owner Occupier P&I)

Get a low interest rate loan with no ongoing fees. Plus you can make extra repayments and free redraw online. Available with just a 10% deposit.

loans.com.au Essentials - Variable (Owner Occupier, P&I)

A competitive interest rate home loan with interest only options. Interest rate 3.64% p.a.
comp rate of 3.66% p.a.

Tic:Toc Live in Loan Variable Rate - Principal & Interest

Get a very low interest rate and avoid big fees. Apply online for full approval in under 30 minutes and add a 100% offset account for $10 a month.

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6 Responses

  1. Default Gravatar
    PeachMay 29, 2014

    the First Home Savings Account here is ancient, not updated since 2010. All the dollar limits have since been changed AND the whole scheme has subsequently been scrapped.

    • finder Customer Care
      ShirleyMay 29, 2014Staff

      Hi Peach,

      Thank you for your feedback, we’ve now updated the page so it’s relevant for our users.

      Cheers,
      Shirley

  2. Default Gravatar
    JimMay 19, 2014

    Dear sir/madam

    I am buying an established property from a seller
    for $216,000 in fifteen months time to be paid in
    cash from my own savings. The seller is still paying for the mortgage. Could you please tell me
    how and to whom and in what manner should this money be paid?
    Should the payment be made before or after the documentation has been completed?

    Could you please give me an estimate of all other cost including the GST.

    • finder Customer Care
      ElizabethMay 20, 2014Staff

      Hi Jim,

      Thanks for your question.

      Usually, payment is made when the seller and the buyer exchange signed copies of the contract of sale. If you are using a solicitor to draw up the documents then they may be able to advise you how the money should be paid, as the payment terms may be specified in the contract.

      As for GST, the ATO has a GST Property Tool that can calculate the GST that will be payable in the sale.

      I hope this has helped.

      Thanks,

      Elizabeth

  3. Default Gravatar
    phillipFebruary 2, 2014

    is the first home owner grant only for new homes

    • finder Customer Care
      ShirleyFebruary 3, 2014Staff

      Hi Philip,

      Thanks for your comment.

      Yes the FHOG is only for new homes.

      Cheers,
      Shirley

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