If you are a first home buyer, you will know that there is a lot to consider before choosing a property that is right for you and your family. The process involves more than just simply buying a house; there are things to take into account such as property value, getting a professional solicitor, government incentives, valuation and location. We have the answers to all of the questions you may have as a first home buyer, and you will have a much clearer outlook on what you need to consider before buying your first home!
We recently sat down with Chris Liu, an experienced sales agent specialising in house and land with extensive knowledge in helping first home buyers find a property best suited to them. With his architecture background, Chris always introduces a project to his clients with a unique perspective. His aim is to build long-term relationships with his clients, ensuring that they make the best decision for their own circumstances and needs. Read the interview below as we uncover which areas you should consider buying in, how to make sure your property gains value over time and some key insights into the future of the Queensland property market.
1. Hi Chris, thanks for joining me today to give our clients some insightful information on the current Queensland property climate and what they can expect buying their first home. We are seeing a lot of interstate buyers looking to relocate to Brisbane at the moment, what would you say are some of the main forces driving property in Brisbane?
I would say that Brisbane has become more and more popular in recent years, and more interstate investors have put their eyes on the Brisbane property market. South-east Queensland’s affordability, lifestyle and climate have always been some of the main factors that appeal to the southern states. Especially when we compare Brisbane to Sydney and Melbourne, in terms of affordability, the medium house price is only $616,387, which is significantly lower than Melbourne ($936,073) and Sydney ($1,211,488). In addition, the new high-end projects, Queens Warf for example, will definitely push Brisbane into the world-class city and we can tell that the property market still has plenty room to grow in the upcoming years.
2. The government has introduced several incentives to help first home buyers enter the market, what are some of the current incentives that these buyers can take advantage of?
In these recent months, the government has indeed helped a lot for first home buyers enter the market. There are 3 main incentives that first home buyer can apply for.
The first is a $15,000 first home buyers grant to put towards buying or building a new house, unit or townhouse (valued at less than $750,000). The government also offers stamp duty concessions to some first buyers if the home is valued under $550,000.
The second is a scheme for eligible first home buyers to purchase or build a new home with a deposit of as little as 5 per cent as well as the ability to make contributions into your super fund to save for your first home. In addition, A $15,000 grant for new builds contracts signed before 31 March 2021 (building + land price within $750,000).
There is also a 50 per cent rates rebate for eligible first homeowners of up to $1000 or a 100 per cent rebate for those who build or buy a brand-new home.
3. In the last few months, there has been a big increase in the number of first homeowners in the Brisbane property market. What are some of the things that new home buyers should take into consideration when choosing the best location to buy in?
I would say to the first home buyer to think about the future value for the property you are looking to purchase today. If you have a family, you should buy at least 3-4 bedrooms townhouse or house, because you will need the extra space for your kids down the line. But in most situations, the first home buyer is single or young couple, I would suggest them to have a think about the inner-city apartments. Firstly, it is not duplicatable, Brisbane has and will have only one CBD and one South Bank, it will protect the value of the property. Secondly, the rental returns will be higher than suburban properties, it can achieve up to 6-7% returns easily. And finally, it will save you valuable time to travel from home to work every day and will also bring down costs by not having to pay for parking and transport if you are working in the CBD.
4. Following on from the previous question, what are some of the most important things that first home buyers should look out for in a property to ensure that they can gain value further down the track?
One common mistake that many buyers make is skipping the inspection before settlement. I strongly recommend that all the buyers should do the inspection before hand over, no matter if it’s brand new or resale properties. You may find termites on the resales and probably some defects for brand new properties so it is important to inspect the property yourself to check the quality. As I mentioned before, the inner-city apartments can be a good choice for single and young couples. For the apartment market, due to the COVID-19, it has had a significant drop in price. If you are thinking to enter to the apartment market, now is the time to do so because when the international borders open, there will be a large number of overseas investors flooding into the Brisbane market, therefore, the price will definitely go up in the future.
For families, I will say that there is one thing that cannot be ignored, which is school catchment. In the past 5-7 years, it shows that the suburban property in the good school catchment zone has increased dramatically, people are starting to think about education facilities for their kids when they purchase new homes. Therefore, I would say good school catchment properties will have more chance to gain more value further down the track.
5. There are many steps involved in the process of buying a property, and this can often make new buyers unsure of where to begin. Where do you recommend that first home buyers should start the buying process and what are the main steps that they can take to ensure a successful purchase?
First things first, talk to the professional agents who are experts in the specific property type that you are looking for. What I mean by this is if, for example, you looking to buy in the inner-city apartment, you should talk to the agent who mainly focusses on apartments. And if you are looking for suburban houses, you’re better of talking to a house and land professional. For example, I specialise in house and land and I have been working with big builders like Metricon and Skyfield Homes for a long time, therefore I walk clients who are interested specifically in house and land through the entire process to ensure that they are able to choose the right product for them. Talking to the wrong agent can lead to wasting time and could also lead to a confused outlook on property selection.
6. There are a range of extra cost that are involved on when buying a property, what are some of these extra costs that first home buyers need to be aware of when working out their finances?
Firstly, you will need a solicitor to look into your contract carefully, to try to maximize your benefit and protect you during the buying procedure. This usually costs about $900-$1500 for the professional solicitor to work on your contract. Secondly, if you are an international buyer, there is another 7% extra stamp duty that needs to be paid to the government, along with a FIRB approval that will cost you $5,650. Thirdly, it is pretty normal that valuation comes under the contract price when you buying properties.
7. Moving into the future, what are some of your predictions for the Brisbane property market in and what trends can you see based off your own experience in the field?
I would say in the next few years, there will be a significant increase for interstate buyers to invest in Brisbane. Especially when Queens Warf has been completed; it will bring Brisbane into the next level of a world-class city and it will boost the Brisbane property market’s value for sure, no doubt.
8. Lastly, what tips and advice can you give to first home buyers who are actively considering a purchase in 2021?
My advice would be to definitely go for it, it is the best time ever to purchase property in 2021. People are still suffering from COVID-19 right now, and the international border still remains closed. A large number has been offered in incentives to encourage buyers to make purchases. So, if you are currently in the market and ready to buy, just go for it. When the border reopens late this year or early next year, there will be a huge number of international investors flooding into the local market, which will push the prices up.