Should I Buy My (First) Home?

arkhos on 19/04/2023 - 11:51
Last edited 19/04/2023 - 14:13 by 2 other users

Hi guys,

Potential first home buyer here. I apologize for any potential naivety in what follows below, but I just dip my feet in the housing problem. So, I guess it is better to describe the situation rather than to just come up with a plan.

I am a 35y old Australian PR who used to live elsewhere for the past 2 years or so. I recently got an offer for a job in Sydney for about $120k +super, which made me consider moving back and live in Sydney for at least 3 years.

Given the rental market, I am considering buying a property, where I would plan to live for at least these initial three years, with the possibility of letting the place afterward. I can count on about $400k savings. That's the givens of the problem.

The goal is to invest in a property that would generate a net cost comparable to what I would otherwise pay as a rent. If I understand well, the variables of the problem here are the cost of the property, the length of the loan and the possibility to fix rates.

Playing around with mortgage calculator, it seems like I should target a one/two bedrooms for about $700k, but I am happy to listen for recommendation, also because I have no clue on whether my situation allows for tax optimizations of any sort.

Thanks

Financial

Comments

  • [Deactivated] on 19/04/2023 - 12:04

    I can count on about 400k AUD savings. That's the givens of the problem.

    How is this a problem?

    • Jimothy Wongingtons on 19/04/2023 - 12:13
      +1

      op said sydney so he's prob gonna need more like 2 mill savings for a loan if he wants anywhere within cbd HAHA

      • [Deactivated] on 19/04/2023 - 12:26

        There are quite a number of Sydney CBD apartments - studios/1BRM - that are < $1M however the strata fees are nutso

        • Jimothy Wongingtons on 19/04/2023 - 12:33
          +2

          Fair. I should have said anything other than a depressing shoebox with no carpark.

  • kekw on 19/04/2023 - 12:15
    +11

    weird flex

    • Bargainitis on 19/04/2023 - 13:15

      hahaha we all butt hurt now…. that b@stard!

  • Dack Smith on 19/04/2023 - 12:23
    -1

    Definitely buy now, the prices are skyrocketing and you won’t be able to afford anything in a few years.

    It’s a given that property prices will soar to an average of two million per house.

    Do you want to live on the streets?

    • Drakesy on 19/04/2023 - 12:37

      Sydney is down ~20% from peak…

      • jpsnail on 19/04/2023 - 12:51

        which is more reason to buy now if you want to become a home owner anyway?

      • WreckTangle on 19/04/2023 - 15:37

        Not from what I’ve seen. Seems more of a media fabrication. Most suburbs don’t even seem to have dropped.

      • Surfsalot on 19/04/2023 - 21:36

        Stop watching the 6pm news lol

  • datafellows on 19/04/2023 - 12:26
    +1

    How about buy something below $400k and enjoy other aspects of life other than mortgage :)

    After 3 years if things go well buy 1 more.

    • bobbified on 19/04/2023 - 12:37
      +2

      How about buy something below $400k and enjoy other aspects of life other than mortgage :)

      I don't know how OP will be able to "enjoy other aspects of life" by living in a garage because that's pretty much anyone can get for $400K in Sydney! 😋

      • datafellows on 19/04/2023 - 12:46

        There's many units for that price range. My friend offered $30k below advertised price for a newish 2 bedroom apartment, south of Parramatta, he paid $450,000.

        • bobbified on 19/04/2023 - 12:53

          I was looking recently myself and there's not really that much in Parra at that price point. The ones that are available are generally older style ones. Depends on the OP's preference I guess. (I've been looking at the more modern apartments).

          It's their first home, so it might be useful to make the most of the first home buyer's stamp waiver up to $600K.

          • datafellows on 19/04/2023 - 13:05

            @bobbified: Not exactly Parra but south, like Harris Park, Merrylands, Granville, Guildford.

            When you consider the stamp waiver I agree, you can save some there, but I have lived long enough to have stressed enough about mortgage payments :D I didn't learn from my parents who had to count pennies when times turned tough and there was a mortgage to pay.

            • bobbified on 19/04/2023 - 13:14

              @datafellows:

              …like Harris Park, Merrylands, Granville, Guildford.

              They're the umm… trouble areas, aren't they? …where one can practice their bullet-catching skills!

              but I have lived long enough to have stressed enough about mortgage payments

              I know exactly what you mean and I'm guilty of that too! I guess it's all part of the fun! haha

              • datafellows on 19/04/2023 - 13:34
                +1

                @bobbified: I don't know about the nightlife or life after the dark, I stay indoors :P

              • randomusername2017 on 19/04/2023 - 15:11

                @bobbified: Granville has some value propositions at the moment.

                Bars on windows for the other three ..

  • bobbified on 19/04/2023 - 12:43
    +2

    If you can afford it, why not? You either pay your own mortgage or you're paying someone else's.

    Renting is good if you plan on moving around or if you're not sure whether you're staying, because it allows more flexibility and less commitment. But if you are already planning on living in Sydney for more than a few years and you can afford it, then buy it.

  • Bafranz on 19/04/2023 - 12:55

    Buy buy buy

  • 87percent on 19/04/2023 - 13:53
    +2

    Even if I was single, I would not want to live in a one bedroom apartment

    • plmko on 19/04/2023 - 14:05

      Depends. If it were a high pressure job then living 5 minutes from work can be an asset.

    • bobbified on 19/04/2023 - 14:11

      Depends on who wants to crash over. One bedroom means that you share the bed. 😁

    • ForkSnorter on 19/04/2023 - 14:15

      https://www.realestate.com.au/property-apartment-nsw-camperd…

      I wouldn't mind living here.

      • bobbified on 19/04/2023 - 14:22

        I wouldn't mind living here.

        eeeek! "Price guide of $830K"…. (That $830K figure would be on the lower side as well!)

        • ForkSnorter on 19/04/2023 - 14:48

          Yeah I wouldn't pay that much for an apartment. But for Sydney it's probably cheap.

      • [Deactivated] on 19/04/2023 - 14:32

        I used to live opposite that building!

      • KaTst3R on 19/04/2023 - 15:52

        The toilet looks very weird. I have never seen a toilet with 4 types of totally different style tiles (plain white, blue, marble style and bronze honeycomb?). And the door is a different color to everything. It is like sensory overload when you take a sh!t.

        You either have 1 style for all walls including floor or 2 types which are complementary (1 feature wall) but wall and floor are same tile different sizes, or floor and wall are 2 types but complementary.

  • mr_vino89 on 19/04/2023 - 16:16

    I think you might be overthinking too much as a first home buyer. you should buy the house that fits your current circumstances and to get your foot in the door with owning a property. Your first house is unlikely going to be your last house. If in 3 year times your circumstances change you can either rent it out if possible or sell it worst case.

  • Dack Smith on 20/04/2023 - 12:00
    +2

    It’s just not going to get any better, Labor will be aiming for another million immigrants per year in the near future, it’s hard to compete when you’re getting huge waves of foreign money crashing into Australia and snapping everything up.

    I can’t afford a house now, and regret not getting a mortgage five years ago.

    It’s up to you to decide if you want to be swayed by some of the deceitful replies here in OzB - they’re certainly not the brightest by any low standard.

  • MarsTitan on 20/04/2023 - 17:24
    +1

    BTC /end thread.

  • 2esc on 20/04/2023 - 18:31
    -1

    Visited Sydney 20 years ago thought it was a dump maybe its improved.

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