Buying a home
Buying a home in NSW
Real estate in New South Wales has proven to be a resilient and profitable investment, regardless of whether you choose to live in your property as an owner-occupier or rent it out as an investment.
NSW offers a diverse range of property options including houses, apartments, contemporary new developments and charming old estates. When it comes to location, property buyers in the state are spoilt for choice, with options by the sea, on the harbour, in the country or in the centre of large, cosmopolitan cities.
Ways of buying a home
In NSW you can buy a house, apartment or property in one of two ways – by private treaty, where you negotiate with a real estate agent or owner to buy a property for sale or, more commonly in Sydney, by public auction.
Most people buy houses or apartments, though it is also reasonably common to purchase a vacant block of land then build a house on it. However, vacant blocks are becoming increasingly rare in the suburbs in and around Sydney.
The Home Buying and Building section of the Housing NSW website provides information on the processes involved when you search for and purchase a property in NSW. This website also lists helpful publications that detail the extra costs you will incur when you purchase a property in NSW, such as government taxes, conveyancing and the costs of pest and building inspections.
Housing NSW also offers a free Home Purchase Advisory Service, which you can contact for advice on all aspects of purchasing your home by emailing firstname.lastname@example.org.
When buying a property, you will normally need a lawyer to assist you with contracts. To search for a lawyer or conveyancer who specialises in organising property purchases, visit the Law Society of New South Wales.
If you wish to find a real estate agent to search for property on your behalf before you arrive in Australia, visit the Real Estate Institute of NSW. The agents listed on this site are Institute members who have passed strict criteria to gain membership.
If you are not an Australian or New Zealand citizen or a permanent resident, you may need approval from the Foreign Investment Review Board before buying residential property.
If you need to arrange a home loan there are many websites that summarise different lenders' fees and services and help you calculate how much you can borrow.
Most Australian residents pay off their home loan over 25 to 30 years, although many mortgages make provisions for early repayment. You can expect to make payments on a monthly or fortnightly basis. As in all countries, interest rates vary depending on the financial institution and the terms of the loan, though Australia boasts comparatively low rates compared with many other countries, around 6.5% to 7.5%.
Your application for a home loan may be approved or rejected depending on how much money you have for the deposit – lenders ask you to have between 5% and 20% of the value of the property you wish to buy, depending on the type of loan. Lenders will also need to see proof of your income and your partner's income if you are purchasing a property as a couple.
There are two basic types of home loans – owner-occupier loans where you buy a property and live in it while paying off your mortgage and using your home as security for the loan; and investment loans.
Investment loans come in various types – you can choose fixed or floating rate loans or have a combination of both fixed and floating rate loans. For more information about investing in property in NSW visit Money Manager.
You may also need to take out the following types of insurance to secure a home loan:
- home building insurance
- income protection insurance
- mortgage insurance.