Purchasing a property is a cherished aspiration for numerous individuals holding Australian Temporary Visas. This aspiration can indeed materialize if you strategize and execute your plan accordingly. Although the process may seem overwhelming and daunting for new immigrants in Australia, adopting a step-by-step approach and conducting simple calculations can set things in motion. Furthermore, many individuals may find themselves perplexed by the requirements and limitations, particularly pertaining to temporary visa holders. There are five crucial aspects that these individuals should take into consideration.
- Step 1: Determine your borrowing capacity by seeking assistance from a mortgage broker.
- Step 2: Save funds for the down payment and other associated expenses involved in property acquisition.
- Step 3: Select a property that aligns with your specific needs and preferences.
- Step 4: Sign the contract.
- Step 5: Your dream home is now yours!
Temporary visa holders should prioritize determining their borrowing capacity by consulting a mortgage broker. When opting to purchase a house through a mortgage, it is imperative to obtain approval from a bank. This should be your initial course of action. Often, individuals become overly enthusiastic and commence searching for properties on platforms such as realestate.com without a well-defined plan. While browsing through available houses may be enticing, it should not be the first step. Instead, seek the guidance of a mortgage broker to assess your borrowing capacity. It is important to note that not all banks may be willing to grant loans to temporary visa holders. Therefore, it is advisable to select a mortgage broker who can serve as your trusted advisor. It is worth mentioning that mortgage brokers do not charge any fees for consultations, as they are remunerated by the banks. Hence, it is recommended to consult with two or three mortgage brokers and identify the most suitable professional who can assist you in securing a loan.
Here are a few links that can aid you in selecting a mortgage broker: https://www.mortgagechoice.com.au/
https://www.leadsquared.com/industries/lending/mortgage-brokers-in-australia/ https://www.ratemyagent.com.au/blog/post/2024-top-mortgage-brokers-national/
Complete the necessary steps to finalize the purchase. After selecting the property and negotiating with the sales agent or sellers, you will need to sign a contract of sale. This contract includes important details such as your name, loan information, downpayment details, and additional clauses like the financial clause and building and inspection clause. The financial clause informs the sellers that you require 21 days for the bank to approve your final loan. The building and inspection clause indicates that an inspection will be conducted before the final settlement. If the inspection report reveals no issues, you can proceed with the settlement. However, if there are any repairs or problems identified, you can use the report to negotiate further. It is worth noting that in Western Australia, negotiations can only be made if the house has structural damage. You can include any specific terms or conditions in the contract to protect your interests.
Temporary Visa Holders: Save for the downpayment and other costs involved in buying a property:
- Example: Property in Queensland costs AUD 400K
- Downpayment (20% for temporary visa holders): AUD 80,000
- Foreign Investment Review Board approval required: AUD 13,200
- Stamp duty (varies by state): AUD 34,625
- Buyer’s agent fee (estimated): AUD 12,000
- Conveyancer’s fee (estimated): AUD 2,000
- Building and pest inspection (estimated): AUD 500
- Total cost: AUD 140,325
Temporary Visa Holder: Buy a property that would best fit your suitability:
- Speak to a mortgage broker to understand your borrowing capacity
- Temporary visa holders can buy any type of property within their budget (new home, established home, units, townhouses)
- Property must serve as your main residence and cannot be leased
- If the property is no longer your primary residence, it must be sold within 3 months
Temporary Visa Holder: Sign the contract:
- After negotiating with the sales agent or sellers, sign a contract of sale
- Contract includes details such as your name, loan details, downpayment details, and clauses (financial clause, building and inspection clause)
- Financial clause: Informs sellers that you need 21 days for bank approval of your final loan
- Building and inspection clause: Informs sellers that an inspection will be done before the final settlement amount
- If the property report is fine, you can proceed with the settlement
- If there are repairs or problems, you can use the report to negotiate further
- Note: In WA, you can only negotiate if the house has structural damage
- Specify the settlement date in the contract (usually 30-60 days)
- On the day of settlement, you will receive the house keys and become the owner
