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Real Estate

  • Written by Mark Ribarsky

With sky-rocketing house prices it’s wise to look at how you can save money when buying a home. We look at the top 5 tips on how to sharpen your property hunting skills and buy the right property at the right price.





Tip 1. Stamp duty savings:

If you’re spending around $1M dollars on a property in Melbourne, the stamp duty fees / government taxes work out to around $55,000. And that’s only if it’s your principle place of residence. A homebuyer cannot claim this tax as a deduction and it must be paid within weeks of a property settling.

Stamp duty can be reduced buy 20% to 30% if you purchase a property off-the-plan or purchase a vacant block of land. For more information on this check out the State Revenue Office website.


Tip 2: Use a buyer’s agent:

Buying a house requires a buyer to understand many aspects that require a lot of skill and experience. Most likely, a buyer will never grasp each part of the buying process comprehensively, hence make costly mistakes along the way.

A buyer’s agent is a real estate agent that represses the best interest of the property buyer. They are skilled in all aspects of the property purchase from:

  • *  Picking a house that will get you a higher rate of capital growth than a common house in an area.

  • *  Evaluating a property, setting limits on how much you should pay for a property.

  • *  Save money with professional negotiations via a private treaty or auction method of sale.

  • *  Shorten time on the market, securing a property in a matter of weeks.

  • *  Buyer’s agents are a great source of off market listings, these are properties without public marketing campaigns. The benefit is that there is less buyer competition.

 

Tip 3: Do your homework.

An unconfident property buyer is about as effective as a blunt axe. When it comes to buying property, market knowledge is everything. Become a property guru before you start the buying process. This will help shorten your time on market and minimise how much you will pay for a property.

Focus on:

  1. Attending open for inspections and auctions.

  2. Learn about the suburb (schools, transport, shops etc.) and what it is offering as this will help identify buying hot spots.

  3. Know what has sold recently, the size of land, number of bed / bathrooms and car spots and the price it went for. Know how long a property has spent on market.

  4. Make friends with real estate agents, they are a wealth of knowledge when it comes to an area. They can also let you in on off market properties.

 

Tip 4. Phone a friend:

The saying ‘two heads are better then one’ is wise when it comes to successful completion of an activity that requires research.

When buying a property, the task at hand can feel overwhelming and cause information overload. So a friend can add a level of value or clarity when buying. This could range from an obvious flaw in a property’s location, a property fault or the wheeling and dealings with a real estate agent.

Useful friends can be people with trade experience, a real estate agent friend or a property investor.

 

Tip 5: Reduce your mortgage by selling your backyard.

Many property buyers are now focused on land that has the ability to add on a second dwelling.

Property that has this option gives its owners long-term financial benefits, consider:

  • Dual dwellings and creating a rental income.

  • Reduce your mortgage by selling one of the properties.

  • Gain a second property that you don’t pay stamp duty for.

  • Unlock the equity of a second property in the future without having to pay additional overheads like service charges, rates or taxes in the present.

 

 

 

About The Author. Mark Ribarsky, a Bachelor of Business, is the founder of Wise Real Estate Advice (http://wiserealestateadvice.com.au/) and Property Managers Melb (https://www.propertymanagersmelb.com.au/). He is an experienced residential property developer, a fully licensed real estate agent, a buyer’s agent and property manager.