Getting onto the property ladder can be a bit overwhelming, especially if you want into the Melbourne property market, with all its different purchase options, processes, duties and obligations. But with so much more to gain than lose, getting your foot onto that first rung should be a top priority, no matter what age you are.

Just take it one step at a time.

But let’s not confuse overwhelming with impossible or difficult. Sure, there are quite a number of things to do when purchasing your first home, but it’s just a matter of taking the first step. Then the next. Then the next. So, what’s the first step? Ask yourself…

Property Ladder1. Why do you want in?

Of course, you want to purchase a home, but this is about assessing why you want to get into the Melbourne property market. Are you after a home of your own, that you can live in for the long term?  Or are you looking to start a portfolio of investments? Perhaps you just want the security of home ownership – so anything will do? Really have a think about this because knowing why you want to purchase will dictate the outcome of the next step…

2. Determine the finance.

Unless you’re able to purchase with cash, you’re going to need finance from a bank or some type of lending institution. Once you know why you want to purchase, you’ll be able to work out what type of loan you need and which lender has the best options for your situation.  For example, most lenders require a higher deposit for investment purchases, as opposed to owner-occupier home loans. So, now that you know why you want to purchase, and what type of finance you need, the next step is…

3. Work out the cost!

So, what it is that you want to purchase? A free-standing existing home? An off-the-plan apartment? A house and land package?  Where is it going to be located? Inner city? Suburban? Or regional? Naturally, depending on the type of property and where it’s located will alter the price greatly. Take some time to work this one out because until you know what you want and how much it costs – you won’t be able to progress to the next step.

4. How much to save.

Of course, the more you have saved, the better. But remember, the money you’re saving isn’t just for the initial deposit down on the home – which will be determined by the answers you gave in #2 and #3 above. You will also need to save for the applicable stamp duty (which is only calculated on the land component for house & land packages or properties yet to be constructed), legal and administration costs, loan application fees and Lender’s Mortgage Insurance (aka. LMI, which is a premium usually for those borrowing more than 80% of the property value).

Now, to work out how much you need to save: Equity deposit amount + stamp duty + legal/admin fees + loan application fees + LMI (if applicable) = how much cash you need.

Success Starts Here5. Where to from here?

Once you’ve taken those initial four steps, this step is about chatting with an expert who can help you take the plunge! Success in the property market – whether it’s purchasing just for yourself or as the seed for your investment portfolio – only comes once you begin.

So whether you speak with a mortgage broker, banker, real estate agent, or an experienced property professional – providing the information from above will help them help you get onto the Melbourne property market ladder sooner than you may think!

If you’d like to chat with one of our team about our hassle-free properties and investment opportunities, click here to submit an enquiry today!

Please note: The information provided in this post is general in nature only and should not be considered financial advice. It has been posted without taking into account any of its viewers’ objectives, financial situation or needs. Before acting on any information, you should consult a license financial professional, as well as consider the appropriateness of the data, having regard to your own objectives, financial situation and needs.