One of the most common questions aspiring home owners ask is whether they should buy property now, or wait and save more money.
Everyone has an opinion on the real estate market and there is a lot of speculation. Some say prices have grown a lot and eventually they will have to come down, so the best strategy is to hold out. Others believe that due to property prices continuing to rise, you should jump into the market straight away or risk being left behind.
No one has a crystal ball and can predict what will happen in a year or in 10 years’ time. Everyone is different and you should make your decision based on your financial situation and expert advice. If you are in the position to buy and have a sufficient deposit that is at least 20 per cent of the purchase price, there is no reason why you shouldn’t try and buy a home.
Right now, interest rates are at historic lows, which benefits buyers as the cost of borrowing is lower. It is also beneficial for anyone with a mortgage as they can pay it off faster.
But what about property prices?
It is no secret that Sydney has seen a lot of growth in the past five years. CoreLogic RP Data stats show that in the 12 months to November, the median house price in Sydney rose 13.5% to $990,000, while the median unit price rose 10.8% to $715,000.
As Sydney’s population continues to grow, so too will the demand for housing, and this will inevitably impact on property prices. Many buyers have been priced out of popular areas close to the CBD, but there are still pockets, such as the Macarthur region, which offer affordable prices for first home buyers. The key is to buy where and what you can afford. It may not be your dream home or ideal location, and in some cases, you may want to start out investing first.
If you are keen to get onto the property ladder, you should find out what you can afford to buy, and do plenty of research on areas you may be interested in.
Always speak to an expert, whether that be a mortgage broker or a real estate agent.
At the end of the day, knowledge is power and it will help ensure you make a good decision.