Buying your first home can be an exciting prospect, and now is a great time to buy; we’re experiencing record-low interest rates and the government has recently expanded on grants available to first home buyers. But buying a new home does come with challenges, especially if you’re not informed about the process. This first home buyer’s guide will equip you with the knowledge you need to start the journey towards becoming a first home buyer in NSW.

Your First Home Buyer’s Guide

There are several first home buyer grants available for eligible first home buyers. Having an understanding of which can apply to you is crucial when buying your first property. Our first home buyer’s guide will tell you how to set a budget, which first home buyer grant (if any) might apply to you and how to find a property in an area that is suitable for you.

Setting a budget

It’s tempting to want to buy a property in your favourite areas, but any first home buyer’s guide will caution against this. The reason is that homes in your ideal area may not necessarily be the best long-term investment for you. Even if you’re looking to live in your new property, as your first home, it’s very likely that you’ll end up either renting or selling in order to upgrade. When you do, you’ll want to get either a decent rental yield or a good selling price.

First, you need to understand your budget, which means speaking to a lender or mortgage broker and understanding your borrowing capacity. Once you do, however, you shouldn’t necessarily borrow the maximum amount possible! You also need to take into consideration any fees that come with owning your own home, such as council rates, water or strata fees, as well as the cost of maintaining the property and any of your own expenses.

If you’re looking to buy an investment property and you won’t actually be living in the home, ensure you can afford to pay your own living expenses elsewhere as well as any difference between the rent you collect plus fees and property upkeep and your mortgage repayments.

Government grants for first home buyers

Luckily, there are an array of government grants for first home buyers in NSW who are eligible. In NSW, first home buyers can take advantage of the following grants and incentives:

  • No stamp duty payable on properties under $650,000 or vacant land under $350,000
  • Discounted stamp duty on properties between $650,000 and $800,000 or vacant land between $350,000 and $450,000
  • A $10,000 grant may be available when buying new properties under $600,000, or for builders of new homes worth up to $750,000

These grants and incentives may apply to specific dates and may also require you to be living in the property for various periods, so it’s important to check all the terms and conditions of any grant or incentive you’re interested in applying for.

Where to look as a first home buyer in NSW

As a first home buyer, your options may be limited by your budget, but it’s important to choose the right property to begin with. This will only strengthen the foundations for your successes when owning and investing in property.

If you’re considering buying a property but you’re on a limited budget, choose a property that only needs cosmetic updates rather than any major structural changes, unless you’re an expert renovator! You can make a surprising difference to a property simply by changing carpets or adding new floors, applying a fresh coat of paint and updating tap fixtures or cupboard handles. This can be a great option for those who want to buy in a certain area but can’t afford a freshly-renovated property. That way, you can update your property over time.

If you’re not sure where to start when it comes to looking for your first home, we can help. Our agents have an in-depth knowledge of the best areas to suit your needs as well as potential rental returns. We can give you an accurate estimate of which kind of property you can expect to buy and in which areas.

Speak to us

We can also provide you with suburb profiles for the inner Sydney suburbs that are suitable for you and present you with a range of options to suit your budget. Contact us for more information or to start the journey of buying your first home.

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Tolga Ozer, Principal & LREA

Hyde Park’s most highly acclaimed property expert, achieving record-breaking outcomes for owners and investors. Having become the most sought-after agency for Sydney’s inner suburbs and CBD, my team and I take pride in our ability to deliver outstanding results.

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