When is it a good time to buy?

Dec 19, 2022, 00:00 AM

Perth has again been named Australia’s most affordable capital city, but does this mean that now is a good time to buy?

Title : When is it a good time to buy?

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News date : Dec 19, 2022, 08:47 AM

Perth has again been named Australia’s most affordable capital city, but does this mean that now is a good time to buy?

After all, there is a shortage of listings on the market, which is increasing competition among buyers and putting pressure on prices. And interest rates are forecast to increase further.

On the other hand, Western Australia’s economy and finances are among the strongest in the world, which supports borrowing for a mortgage.

If you can afford to buy, any time is a good time, but under current market conditions there are some considerations.

Buy within your means

Interest rates are rising and are expected to increase further into 2023. Factor this into your budget and don’t overstretch yourself.

Revise your expectations

The changes in interest rates have reduced people’s borrowing power. You cannot borrow the same amount you could 12 months ago.

Speak to your bank or broker to get an idea of what you can borrow now and look at homes within that range. You may find you need to consider homes in lower price brackets or other options, such as a villa or unit instead of a house, or a different suburb than what you would have initially aimed for.

Buy wisely

Consider your needs and think about other options. For example, if you can afford it, buying a home with a granny flat may give you a source of rental income to support mortgage payments.

Or it could be worthwhile buying an older home on a larger block in a suburb that may allow you to subdivide in the future.

If you are a family and are planning to stay in the home for a number of years, then price fluctuations really won’t matter.

If you are speculating and looking to renovate and flip homes, do your research. Costs for trades and supplies have risen and there are delays in the building and renovation industries. You may find it is not cost effective.

Alternatively, you could consider investing. You may choose not to buy for yourself right now and buy an investment instead. The rental market is very strong and there is a desperate need for more rental properties.

contenttypes : News

topics :

Advice
Housing affordability
Trends

audiences :

Experienced buyer
First home buyer

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