buying or renting - pros and cons

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buying or renting - pros and cons


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Old 05-16-2012, 04:43 PM
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buying or renting - pros and cons

hey guys. i've always prefered the idea that a home is your own and you can do what you want as opposed to your living in someone elses house. i've been reading that its better to rent than to buy but i'm not totally convinced. maybe its just me but anyone got and advice?
cheers


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Old 05-16-2012, 08:51 PM
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It is definitely better to have your own rather than rent. Given property shortages in Australia, rents are very expensive these days and it is cheaper to go into mortgage. I did that myself and today I am paying around $220 per week + $55 per week for strata, water, council (which you normally don't pay when you rent) comparing to nearly $400 per week for the same unit rented. Apparently, as I repay my mortgage, my repayments go down.


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Old 05-17-2012, 01:09 PM
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is it difficult for foreigners to get mortgages?


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Old 05-18-2012, 10:33 AM
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If you have permanent residence visa or Australian citizenship - no problem at all

If you have any different visa - I am pretty sure no bank will grant you one.


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Old 06-07-2012, 07:46 AM
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I have been told by my Australian partner and my "in-laws" that buying is a much better idea. They tell me it is not cheaper to rent (at all) and if you buy, you'll be able to seriously up the house's value with things like adding solar panels, etc, over the years. From what I hear the house market is doing good enough here to presume it's a good investment at least. If you have the financial means, you might as well buy - we will as soon as we do.

Not many countries will allow you to get a mortgage if you are not a resident. I worked in the mortgage area in my own country and no way did anyone without permanent residency get a loan - it is simply far too big a risk for a bank in good standing to lend money to that subgroup of people. Anyone who will offer you a mortgage when you are on a temporary visa should probably be steered clear from because they would have to implement some pretty big advantages for themselves to take that chance so they will probably make big bucks off you even if you end up leaving the country/without work.


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Old 06-12-2012, 01:02 PM
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Right now is a good time to buy - house prices are falling - rents are increasing.
The problem is how far they may fall....so make sure you do not overcommit yourself financially.

I have applied to Commonwealth Bank for a home loan and been provisionally accepted.
You need the PR visa.....and an income.

Good luck.....

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From the Kingdom of Cambodia to Australia.......

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Old 06-20-2012, 09:56 AM
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If you want to purchase house in Australia then purchase an under development town homes. Looking at a genuine financial investment perspective, development sites have a chance of price appreciation. So buying in the first stage of development will be a good buy and once the development is complete the cost of the same property or house would have shot up.The ARDevelopments Aspect North, Gumtree Woods and Narangba Valley Square is the newest discussion in the town.


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Old 08-05-2012, 11:05 AM
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is definitely a better idea to buy, in Australia mainly, the market is excellent , the land prices increase quite fast so is very good to invest, moreover, if you get a good mortgage like we have with the bank westpac you may be able to finish paying your house in only 6 yrs, yes, is amazing


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Old 08-08-2012, 09:00 AM
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Please update your flag here .

Quote:
Originally Posted by Dexter
It is definitely better to have your own rather than rent. Given property shortages in Australia, rents are very expensive these days and it is cheaper to go into mortgage. I did that myself and today I am paying around $220 per week + $55 per week for strata, water, council (which you normally don't pay when you rent) comparing to nearly $400 per week for the same unit rented. Apparently, as I repay my mortgage, my repayments go down.
Wow, that's lot of saving. Will you mind sharing the Loan Term & Amount? Typically the initial payment is like 10% of the house value? How much loan can we apply like 20 yrs?


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Old 08-08-2012, 04:12 PM
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Here are some fun calculations to try out.

Take your weekly rent and multiply by 830. That is the purchase price of the property you can afford.
Take your weekly rent and multiply by 44. That's the approximate fees it will cost on top of the purchase price.
The above would work for you, if you have your weekly rent multiplied by 175 in cash savings as your deposit on the property.

Eg.

$300 per week rent.
= $300 x 830
= $249,000 house purchase price

Fees to complete purchase...
= $300 x 44
= $13,200

You will need saved cash (for deposit) of :
= $300 x 175
= $52,500

Your bank loan will be :
= $300 x 700
= $210,000
= ~$300 per week repayments


Eg. Another example :

$425 per week rent.
= $425 x 830
= $352,750 house purchase price

Add fees to purchase...
= $425 x 44
= $18,700

You will need saved cash (for deposit) of :
= $425 x 175
= $74,375

Your bank loan will be :
= $425 x 700
= $297,500
= ~$425 per week repayments

---------------------------------------------
The above is a bit of fun in numbers and works in the current market, based on following :

As you are paying your rent, I have assumed you would have an income to satisfy the banks requirements.
Bank loan interest of 6.3%
Deposit savings of 20%, hence a loan of 80% of the purchase price + fees.
Assumes 5% in fees on top purchase price.
Repayments are weekly, principle and interest, over 30 year term.

If you want an Excel sheet with the above easy calculations, just message me.


Ps : it's late... I hope I entered the above numbers correctly... Sorry if any errors!

Cheers
Mark


Last edited by chifin; 08-08-2012 at 04:56 PM.

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