One of the most exciting aspects of buying your first home is deciding which type of place is right for you. Here’s what to weigh up.
As a first home buyer, the world is your oyster. You can choose from a house with room for a backyard veggie patch, a chic apartment, or maybe enjoy a bit of both with a townhouse or villa.
It’s all about deciding what works for you. Here are some pointers to help you decide the type of dwelling that satisfies your wish list.
Apartments – affordable and low maintenance
More Australians than ever are choosing apartment living, and if you’re on a tight budget the good news is that apartments tend to be a lot more affordable than houses. Lower maintenance living is another upside. No weekends spent mowing lawns or cleaning gutters. But there is a catch. As an apartment owner, you’ll pay quarterly strata levies that go towards the upkeep of common property. You may also have to contribute a capital works fund, which help to cover the cost of any major repairs in the future. These outgoings may seem like an additional expense but they can actually work out cheaper than the repair and maintenance costs of owning a house. On the downside, apartment living can offer less scope to complete major renovations. Unlike owning a house, the external walls, floor and roof of an apartment don’t usually belong to the unit owner but rather to the owners’ corporation. That’s not to say you can’t add value – and your own touch, through fresh paint or new floor coverings but it’s going to be a squeeze to add an extra bedroom.Be aware too that apartments can bring lifestyle restrictions. Some strata schemes for instance don’t allow residents to own pets.
Townhouse or villa – some outdoor space
A townhouse or villa can offer low maintenance living while still offering a small private outdoor area – and they can be an affordable housing option. In this sense, townhouses and villas can be something of a middle ground between houses and apartments. As with a unit, townhouses and villas may be owned through strata title. One benefit of this is that the maintenance of common areas is outsourced to a service provider – and paid for by individual property owners through quarterly strata levies. Just as with an apartment, making any major changes to the property can call for approval from the owners’ corporation.
Dual occupancy – a bit of both worlds
As the name suggests, a dual occupancy is where two homes are built on one block of land. In order to purchase one of the homes on a dual occupancy, each property must have its own separate title. If your heart is set on a house but your budget is tight, a dual occupancy can be an affordable way to enjoy some yard space. The minimum land size for a dual occupancy varies between councils but it can be around 400 square metres. It’s not huge, however it’s still enough to enjoy a garden and bring the family pet along too. One of the drawbacks of a dual occupancy is that you could be living in close proximity to your neighbour. This can be lead to a lack of privacy especially if you are located in front of the second dwelling, and the neighbouring residents have to travel directly past your place to access their own home.
Duplex – double the fun
Like a dual occupancy, a duplex can be a budget-friendly home. The key difference between the two is that duplex dwellings are likely to be linked by a common wall. Along with potential privacy concerns, this can mean that both homes need to share a single building insurance policy – something you’ll need to sort with your neighbour. In addition, an agreement may made need to be reached on how shared property such as the roof, will be maintained.
House and land – a brand new home
There’s a lot to love about the idea of building a new home from scratch. It’s a chance to tailor the property so that the layout and design reflects your needs and lifestyle. And depending on where you buy, it can be cheaper to build a new place rather than buy an existing home. If you buy a vacant block and build later, you only pay stamp duty on the value of the land – the value of the building is not taken into account as it would be if you purchased an established property. A new home built as part of a house and land package should be constructed from modern materials and fitted out with the latest appliances. So it can be more energy efficient than an older home, with the potential to help you save on power bills. One of the traps to be aware of, is understanding exactly what your house and land package buys – driveways for instance, may not be included in the price. Check your contract carefully.
Deciding the type of home that’s right for you is a highly personal decision – and it can impact the type of home loan best suited to your needs.
Talk to us for help with your first home loan to be sure you have the loan that’s as right for you as your new place.
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- Chapter One : Getting started
- Chapter Two : Your Dream Home
- Chapter Three : Money Matters
- Chapter Four : Ways to Purchase
- Chapter Five : Understanding Interest Rates
- Chapter Six : Understanding Home Loans
- Chapter Seven : Lending Sources
- Chapter Eight : Getting Your loan
- Chapter Nine : Choosing a Home
- Chapter Ten : Steps to Settlement