Buying a house in Melbourne is an exciting time when you can explore what’s on offer on the market and begin to build a new life for you and your family.
Finding the right home for you and your family involves research and careful consideration. Melbourne has a lot to offer, but you want to make sure the property is the right price, location, value, size and fit for your lifestyle. The information you’ll find here will help get you started.
Explore Melbourne’s suburbs
If you already know where you’d like to buy a house in Melbourne, that’s great. But if you’re unsure of where you should start looking, it’s worth considering many different areas. Neighbouring suburbs can vary in price enormously, as can different properties in one suburb. It’s also worth researching past sale prices in the areas and streets you are interested in.
You can find suburb price information on these websites:
Where to find homes
Properties are usually sold through real estate agents. You can find real estate agents in your area through the Real Estate Industry of Victoria’s agency search tool, or you can search for homes on websites such as:
How homes are sold
Most homes are sold by private sale or auction.
|You can buy the property at the advertised price or a price negotiated with the vendor. Private sales are usually coordinated and negotiated through a real estate agent.||You can buy the property by bidding against others in an open forum.|
At auctions the ‘selling range’ provided by the real estate agent is an indication only and properties often sell for higher than the advertised range.
In both types of sales it is possible to make an offer to the vendor (prior to auction). A written offer to buy the house is not legally binding until both you and the vendor have signed a Contract of Sale or Contract Note.
Inspecting a property before sale
Before making an offer or placing a bid on a property, you may want it inspected by a property and/or pest inspection company to ensure there are no nasty hidden surprises with the property. Report costs vary depending on the type of inspection required.
If you are borrowing money to purchase a property, the lending organisation will usually have a valuer inspect the property prior to lending. However, you may also want to get an independent valuation. Costs will vary depending on the property.
Getting help buying a property
You can choose to appoint a buyer’s advocate to find and secure a property for you. It’s also a good idea to appoint a solicitor or qualified conveyancing agent to handle the legal paperwork associated with the purchase of your property, once your offer has been accepted.
Visit the Law Institute of Victoria website to find a solicitor in your area.
Median prices in Australia
|City||Median house price||Median unit price|
Making a deposit and arranging settlement
A home loan is almost always required to buy a house. Make sure that you’ve organised your finances before making an offer for a house or bidding at auction.
You must ensure that you can cover the deposit for the house if your bid or offer is successful and the remaining money must be available for settlement.
|Deposit||A deposit is generally 10 per cent of the purchase price of a property and must be paid when an offer is accepted or when a bid is successful.|
|Settlement||Settlement is the date the ownership of a property officially changes hands. Settlements usually happens between 30 and 120 days after you buy a property. The date is agreed to between the buyer and the vendor.|
Borrowing money to buy a home
There are a number of different options for borrowing money to buy a home:
- the major banks
- credit unions
- mortgage brokers
- building societies
- specialist home loan lenders
Fees and conditions
Each lender offers different features and conditions. Before you commit, it is important that you understand:
- your options
- any in-built fees such as exit fees
- the interest rate structure (variable or fixed term).
A mortgage broker can help you find the most suitable home loan, however mortgage brokers are usually paid a commission by home loan lenders and you should check the information independently.
There are a number of grants available to homebuyers. Australian permanent residents and citizens who are buying their first home in Australia may be eligible for the First Home Owner’s Grant. On top of this, you may also be entitled to receive a stamp duty reduction.
For more information about these grants, visit the State Revenue Office website.
Extra costs when buying a property
When budgeting for your property, consider a number of costs outside the actual cost of the property. As well as your deposit, you should allow money for:
- stamp duty by the Victorian Government’s State Revenue Office, which is based on the property value (you may also be required to pay a foreign purchasers’ surcharge)
- loan application and other borrowing costs
- land title transfer fee and mortgage registration fee
- any council rates, water, power or gas charges, or body corporate fees (if the property is an apartment or unit in a body corporate block)
- legal and conveyancing costs
- the cost of moving into the new home
- the cost of any repairs or renovations that will need to be done before or when you move in
- building inspection fees
- rates and utility connections
- ongoing mortgage repayments
- home and contents insurance.
Home and contents insurance
Most Melburnians take out insurance cover for their homes and belongings. There are many different companies offering insurance products.
For more information on choosing a home insurance provider, visit MoneySmart.
Connecting your utilities
Before moving into your home, you need to connect your utilities such as electricity, gas, water, telephone and internet. The real estate agent can often refer you to different providers.
For more information and a list of gas, electricity and water providers, visit the Essential Services Commission website or Victorian Energy Compare.
Temporary resident rules and regulations
If you’re a temporary resident (such as a holder of a provisional visa), you need to notify Australia’s Foreign Investment Review Board if you are buying any residential real estate.
Temporary residents are permitted to buy one established dwelling to live in. Temporary residents are also permitted to build new dwellings or develop vacant land in order to build new dwellings, as these activities help to increase the available housing stock in Australia.
Holders of permanent visas do not require foreign investment approval to purchase residential property, including established dwelling for investment purposes.