User Tag List

Dislikes Dislikes:  0
Page 1 of 2 12 LastLast
Results 1 to 20 of 36

Thread: Buying a Home?

  1. #1
    Member peter600's Avatar
    Join Date
    Feb 2009
    Location
    scarboro
    Motorbike
    between bikes
    Liked
    264 times
    Posts
    2,354
    Post Thanks / Like
    Mentioned
    2 Post(s)
    Tagged
    0 Thread(s)

    Buying a Home?

    My son and his GF are looking at buying their first home.
    Any thoughts, warnings, traps, suggestions, preferences?
    What would the collective wisdom of PSB advise?

    Thanks for any input....
    Last edited by peter600; 18-12-2018 at 12:05 AM.

  2. #2
    Member chew's Avatar
    Join Date
    Aug 2005
    Location
    Rivervale
    Liked
    2943 times
    Posts
    14,339
    Post Thanks / Like
    Mentioned
    45 Post(s)
    Tagged
    0 Thread(s)
    As close to the city as possible.
    As much land as possible.
    Worst house in the best street.
    If they see one they both like, buy it, even if it stretches them.
    They hung a sign up in our town "If you live it up, you won't live it down"-Tom Waits
    Likes peter600 liked this post

  3. #3
    Member
    Join Date
    Jan 2015
    Location
    Hillarys
    Motorbike
    Yamaha FZ1N
    Liked
    0 times
    Posts
    146
    Post Thanks / Like
    Mentioned
    2 Post(s)
    Tagged
    0 Thread(s)
    It totally depends on their situation but I would recommend 'rentvesting'. Buy where you can afford and buy as many as you can, rent where you want to live. My fiancee and I are looking to buy our 5th investment property in January, 1 per year for the past 5 years. Lots of tax breaks, use the equity in all the houses to buy the next one and so on. Years ago we did the whole buy the worst house on the best street and I quickly got over fixing the place up on the weekends as well as working 60+ hours a week and having no time to enjoy life. It might not work for everyone but that's my advice
    Likes GsxInShed, peter600, D996R liked this post

  4. #4
    Member GsxInShed's Avatar
    Join Date
    Jun 2010
    Location
    Next to the big hole in the economy
    Motorbike
    (TY-250- RD350LC- Gsx 750 esd) Current -Gsx 250 SSM GSX 1100 EFE
    Liked
    304 times
    Posts
    8,483
    Post Thanks / Like
    Mentioned
    37 Post(s)
    Tagged
    0 Thread(s)

    Quote Originally Posted by chew View Post
    As close to the city as possible.
    As much land as possible.
    Worst house in the best street.
    If they see one they both like, buy it, even if it stretches them.
    Suburb...?
    " Imagination is the seed of life..."

  5. #5
    Member Goliath's Avatar
    Join Date
    Apr 2014
    Location
    Brobdingnag
    Motorbike
    KTM 990 Super Duke
    Liked
    3 times
    Posts
    214
    Post Thanks / Like
    Mentioned
    6 Post(s)
    Tagged
    0 Thread(s)
    When I bought my home 2 years ago people told me so many "golden rules" that were often contradicting that I disregarded most of them anyway. 2 advises I would give to anyone buying first home:

    1. Only buy it if you really like it and your heart is into it

    2. Do not, under any circumstances, trust any real estate agent!!! Treat everything they say as a possible lie. Do not use their property inspectors and always ask for anything they promise in writing.

  6. #6
    Member chew's Avatar
    Join Date
    Aug 2005
    Location
    Rivervale
    Liked
    2943 times
    Posts
    14,339
    Post Thanks / Like
    Mentioned
    45 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by GsxInShed View Post
    Suburb...?
    Get a map and a compass, stick the pointy bit in the GPO set it 10km and draw a circle, if you cant afford any, set it at 15kms, rinse and repeat until you find the sweet spot.
    They hung a sign up in our town "If you live it up, you won't live it down"-Tom Waits
    Likes Green Trident, datsikk, peter600, boeman, D996R liked this post

  7. #7
    Member agrid's Avatar
    Join Date
    Apr 2008
    Liked
    2779 times
    Posts
    14,456
    Post Thanks / Like
    Mentioned
    61 Post(s)
    Tagged
    0 Thread(s)
    What Chew said.
    -

  8. #8
    Member INTJ's Avatar
    Join Date
    Dec 2013
    Location
    Scottsdale, Arizona & Perth, WA
    Motorbike
    None for now.
    Liked
    247 times
    Posts
    2,707
    Post Thanks / Like
    Mentioned
    14 Post(s)
    Tagged
    0 Thread(s)
    Buy the cheapest house they wouldn't be ashamed to call 'home'. It won't be their last purchase so why worry about buying one they 'love' when it's temporary?

    *shudders*
    Likes peter600 liked this post

  9. #9
    Member Wahoo's Avatar
    Join Date
    Jan 2013
    Location
    South
    Motorbike
    Few different breeds
    Liked
    207 times
    Posts
    1,517
    Post Thanks / Like
    Mentioned
    39 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by comehereoften View Post
    It totally depends on their situation but I would recommend 'rentvesting'. Buy where you can afford and buy as many as you can, rent where you want to live. My fiancee and I are looking to buy our 5th investment property in January, 1 per year for the past 5 years. Lots of tax breaks, use the equity in all the houses to buy the next one and so on. Years ago we did the whole buy the worst house on the best street and I quickly got over fixing the place up on the weekends as well as working 60+ hours a week and having no time to enjoy life. It might not work for everyone but that's my advice
    Unfortunately that time has passed and congratulations on doing so well when that was possible.
    Due to the ongoing Senate review on this loan/equity security situation that kept escalating prices, banks must now work to reverse it by making loaning far harder and many are refusing equity in other houses as security. Removing negative gearing is a political prospect to help reverse it too.
    Now, it is very difficult to get a loan for investing in property so it would pay to work out how much finance is available to them before starting. This will dictate the area they can invest in.
    Close to work is a major bonus so if they think they have permanent employment and enjoying it, buy near there. Drive around the areas as often people get desperate trying to avoid real estate agents and have their own signs on the houses.
    When looking at houses, be very sure the structure is sound as repairs and maintenance on a property can be very expensive and often not budgeted for. So be sure to check plumbing, heating, air conditioning, ovens, retric, etc etc is in good condition. If you have doubts and the seller promises to fix something, then be sure that is in the contract and if not fixed, the purchaser can get a quote and that amount is deducted from the final price. Basic electricity, water etc is meant to be working and must be checked on the final inspection.
    Be sure your son has done his budget with realistic living expenses that can cover all purchase expenses, the odd bad experience, plus rates, insurance, electricity, water etc. He may not realise how expensive buying/owning a house could be. Also worth making them both think about the worst case scenario of splitting up and not being able to sell the house.
    Before putting in an offer, hang about the area to see if there is conflict in the area also ask as many locals as possible how they like it there.
    Never put an offer in for what is being asked, always put in a lower offer as they will counteroffer then you can raise/lower the price or refuse to sign. There are lots of houses around, so falling in love with one of the first houses they see is normal and real estate agents saying someone else is interested and may/has put in a higher offer is normal too. Touring around looking at multiple alternative options will help relieve their disappointment when their final offer is not accepted and the delay usually causes the buyer to finally agree to drop the price. Tell them not to bother going to home opens unless they are very happy with what they see but it is an experience for them to see and pick some of the tricks used by real estate agents.
    Watch carefully the political aspect to see if Senate will relax the demand on banks and/or negative gearing plus ignore media trying to ramp up house prices in the meantime.
    Wish them luck from us all.
    Last edited by Wahoo; 19-12-2018 at 04:34 AM.
    Life is NOT a journey to the grave with the intention of arriving safely in a pretty and well-preserved body, but rather to skid in broadside, thoroughly used up, totally worn out, and loudly proclaiming: "Wahoo!! What a ride!"
    Likes datsikk, peter600 liked this post

  10. #10
    Member chew's Avatar
    Join Date
    Aug 2005
    Location
    Rivervale
    Liked
    2943 times
    Posts
    14,339
    Post Thanks / Like
    Mentioned
    45 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by chew View Post
    If they see one they both like, buy it, even if it stretches them.
    Quote Originally Posted by INTJ View Post
    Buy the cheapest house they wouldn't be ashamed to call 'home'. It won't be their last purchase so why worry about buying one they 'love' when it's temporary?

    *shudders*
    If they both like it may not be temporary. Some people make good decisions the first time.
    They hung a sign up in our town "If you live it up, you won't live it down"-Tom Waits

  11. #11
    Member Green Trident's Avatar
    Join Date
    Nov 2014
    Location
    Yanchep
    Motorbike
    Triumph Trident
    Liked
    0 times
    Posts
    1,122
    Post Thanks / Like
    Mentioned
    2 Post(s)
    Tagged
    0 Thread(s)
    A few of GT's thoughts,
    1 Location, location, location. This is subjective so draw those compass circles around Perth, Joondalup, work places, what ever.
    2 Joint tenancy vs tenants in common. This a legal thing and it will become relevant in the case of a death or a split up.
    3 The debt bomb, this is relative to Govco crap and the Royal Commission on banking, this may well push prices down so don't rush into anything.
    4 Wahoo made some very astute observations, so did others here.

    - - - Updated - - -

    Quote Originally Posted by chew View Post
    If they both like it may not be temporary. Some people make good decisions the first time.
    If this turns out to be the case then additions, alterations and even a full rebuild could be long term options.
    The only thing wrong with a perfect ride to work is that you end up at work.
    G T
    Likes peter600, Wahoo liked this post

  12. #12
    Member datsikk's Avatar
    Join Date
    Oct 2008
    Location
    SOR
    Liked
    46 times
    Posts
    915
    Post Thanks / Like
    Mentioned
    2 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by Wahoo View Post
    Due to the ongoing Senate review on this situation that kept escalating prices, banks must now work to reverse it by making loaning far harder and many are refusing equity in other houses as security.
    Re you blaming increasing house prices on the senate inquiry? I think one of the causes for the reckless lending was Kevin Rudds guarantee that no major bank would go bankrupt.

    IF someone gave me such a guarantee, I too would start placing money in high risk/ high reward returns. Another rason for the increase in prices (as others alluded to in other posts) was diy super which allowed investors to buy homes.

    As for tips : factor in an increase in interest rates. Probably assume worse case scenario. Get ahead of the repayments to give you a buffer. Its alot easier sleeping at night if you are a year or 2 ahead on your repayments.
    Likes peter600 liked this post

  13. #13
    Member gareth_oau's Avatar
    Join Date
    Apr 2017
    Location
    Perth
    Motorbike
    Ducati
    Liked
    0 times
    Posts
    282
    Post Thanks / Like
    Mentioned
    0 Post(s)
    Tagged
    0 Thread(s)
    There used to be a time when building was cheaper than buying, but it seems that buying is cheaper at the moment, unless you get a project home miles from nowhere.

    The advantage with building is that you can get something that is close to exactly what you want, whereas if you buy, you end up buying other people's comromises, and you will end up doing just as much work renovating or redecorating or whatever to make it yours, and without the warranties on all the appliances, nor structural guarantee on the construction.

    If they do decide to build, choose a decent builder, not a cheapy that might go bankrupt next month.

    I've built 3 and all have been great projects that I was proud to own
    Likes peter600 liked this post

  14. #14
    Member marras's Avatar
    Join Date
    Feb 2007
    Location
    NOR
    Liked
    379 times
    Posts
    2,225
    Post Thanks / Like
    Mentioned
    9 Post(s)
    Tagged
    0 Thread(s)
    Negative gearing will never disappear. Most politicians have negative geared propertyís and the housing market would be flooded with homes that would be unable to be sold as so many homes are negatively geared.

    As a few others have said. Make sure you get an independent building inspection from a reputable building inspector. This will save thousands of dollars of unforeseen and hidden problems that most people donít know about. And definitely do not believe the real estate agent, they are worse than second hand car salesman.
    Likes peter600, D996R liked this post

  15. #15
    Member boeman's Avatar
    Join Date
    Aug 2012
    Location
    Doubleview
    Motorbike
    Yamaha R15
    Liked
    2997 times
    Posts
    5,279
    Post Thanks / Like
    Mentioned
    49 Post(s)
    Tagged
    0 Thread(s)
    Don't buy to impress anyone. Buy something where the repayments are less than 25% of your household after tax income so the mortgage doesn't control your life and then make extra repayments.

    You get a nice comfy buffer in your redraw, which makes life much easier.
    Likes Green Trident, peter600 liked this post

  16. #16
    Member INTJ's Avatar
    Join Date
    Dec 2013
    Location
    Scottsdale, Arizona & Perth, WA
    Motorbike
    None for now.
    Liked
    247 times
    Posts
    2,707
    Post Thanks / Like
    Mentioned
    14 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by chew View Post
    If they both like it may not be temporary. Some people make good decisions the first time.
    You're hypothesizing the outcome being that 1% chance that an unmarried couple stay together forever and find a home they both want to live in for the rest of their life while they're dating. You're even suggesting they 'stretch' their budget to afford it... that just seems absolutely reckless as far as life choices go

  17. #17
    Member ApatheticEnd's Avatar
    Join Date
    Feb 2008
    Location
    Vic Park
    Motorbike
    Trackwhore & SuperRetard
    Liked
    46 times
    Posts
    3,205
    Post Thanks / Like
    Mentioned
    5 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by boeman View Post
    Don't buy to impress anyone. Buy something where the repayments are less than 25% of your household after tax income so the mortgage doesn't control your life and then make extra repayments.

    You get a nice comfy buffer in your redraw, which makes life much easier.
    Nobody ever listens but this is the most important point of all though I use a 33% rule (I like to live close to the city). My suggestion would be to use the best feature a mortgage can have (aside from a good rate), the 100% mortgage offset account. Put every cent of your spare cash in there. Reduce your interest and stay fully liquid. It's the best thing to ever happen to your regular mom and pop owner occupier and not that many people take advantage of it. We stopped investing altogether and put everything against our mortgage.

    The other thing I would tell young people is DON'T HAVE KIDS! They cost a fortune, force you to buy a bigger house, dictate where you live and how you spend your time, and there are enough of the snotnosed little germ bags getting around the planet already. You'll pay off your mortgage at least 10 years earlier if you don't have kids.
    EXPERIENCE: noun: Knowledge or skill derived from actual participation or direct contact rather than mere study, interest, or internet.
    Likes peter600 liked this post

  18. #18
    Member Hillz's Avatar
    Join Date
    Sep 2010
    Motorbike
    ZX10R, DRZ400SM, SV650S, YZ250, CRF50
    Liked
    0 times
    Posts
    2,372
    Post Thanks / Like
    Mentioned
    26 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by ApatheticEnd View Post

    The other thing I would tell young people is DON'T HAVE KIDS! .

    not to mention every kid you have takes about 100K off your borrowing capacity

  19. #19
    Member chew's Avatar
    Join Date
    Aug 2005
    Location
    Rivervale
    Liked
    2943 times
    Posts
    14,339
    Post Thanks / Like
    Mentioned
    45 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by INTJ View Post
    You're hypothesizing the outcome being that 1% chance that an unmarried couple stay together forever and find a home they both want to live in for the rest of their life while they're dating. You're even suggesting they 'stretch' their budget to afford it... that just seems absolutely reckless as far as life choices go
    Well I may be hypothesising but I generally do not take what others say twist it, then exaggerate.

    It was not that long ago that the theory was house prices double every ten years. Ten years ago the median house price was $480k, now it is $516k. Not quite double.

    In the current climate I cannot see the sense in speculating. More than ever you are better off finding something you are happy to live in.
    They hung a sign up in our town "If you live it up, you won't live it down"-Tom Waits

  20. #20
    Member Wahoo's Avatar
    Join Date
    Jan 2013
    Location
    South
    Motorbike
    Few different breeds
    Liked
    207 times
    Posts
    1,517
    Post Thanks / Like
    Mentioned
    39 Post(s)
    Tagged
    0 Thread(s)
    Quote Originally Posted by datsikk View Post
    Re you blaming increasing house prices on the senate inquiry? I think one of the causes for the reckless lending was Kevin Rudds guarantee that no major bank would go bankrupt.

    IF someone gave me such a guarantee, I too would start placing money in high risk/ high reward returns. Another rason for the increase in prices (as others alluded to in other posts) was diy super which allowed investors to buy homes.

    As for tips : factor in an increase in interest rates. Probably assume worse case scenario. Get ahead of the repayments to give you a buffer. Its alot easier sleeping at night if you are a year or 2 ahead on your repayments.
    No the opposite. The Senate is working at trying to reverse the overgenerous loaning of banks that has inflated prices.
    Life is NOT a journey to the grave with the intention of arriving safely in a pretty and well-preserved body, but rather to skid in broadside, thoroughly used up, totally worn out, and loudly proclaiming: "Wahoo!! What a ride!"

Bookmarks

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •