Our Journey to Buying a House in Australia as Migrants
Buying your first house is a significant milestone for many immigrants moving to Australia, and it was no different for us. Having a place to call our own was one of the top goals on our Australian life journey. But who would have thought that we’d be buying our first house in the middle of a global pandemic? The idea felt like a distant dream at the start, and we had no clue how we’d achieve it. Yet, with determination, discipline, focus, and a few sacrifices, we managed to make it happen.
This story is a look into our personal experience buying our first house, filled with the lessons, insights, and tips that made the process a little easier for us. It wasn’t a smooth journey, but it was incredibly rewarding in the end.
The Seed of an Idea
We first began seriously considering buying our home when a friend casually asked, “When are you going to buy a house?” It hit me—I hadn’t thought about it in detail because we didn’t yet have the ideal 20% deposit. That 20% is the magic number to avoid paying Lender’s Mortgage Insurance (LMI) in Australia. LMI is a fee that protects lenders if the borrower defaults on their loan, and it kicks in when your deposit is less than 20%.
At the time, we had around 15% saved up, but I was adamant that we needed to hit the 20% mark to avoid paying the LMI. However, my friend gave me another perspective. “LMI is just a small price to pay if it means you can own your home sooner,” he said. He had a point. Why keep paying rent, essentially covering someone else’s mortgage, when we could put that money toward something that was ours?
After a long discussion with my husband, weighing the pros and cons, we decided to give it a go. We were going to buy our first house!
Step 1: Finding a Mortgage Broker
One of the smartest decisions we made was engaging the services of a mortgage broker. This was a game changer for us. Our mortgage broker was the bridge between us and the lender. She helped us navigate the complexities of the property market, found the best rates, and gave advice specific to our situation. She also did most of the legwork when it came to our loan application and helped us throughout the entire process.
If you’re thinking of buying your first house, I cannot recommend using a mortgage broker enough. They have the expertise, market knowledge, and industry connections to make what could be a stressful process a lot smoother.
Step 2: Research, Research, Research
Before we were even ready to buy, we spent a lot of time learning. I read books, watched videos, and talked to friends who were already homeowners. We researched everything from property market trends to loan types and basic real estate terms like Lender Mortgage Insurance and Loan-to-Value Ratio (LVR).
At first, it all felt overwhelming. But the more we learned, the more comfortable and confident we became. I even surprised myself by learning how different home loans worked, whether we should opt for a fixed or variable interest rate and understanding the importance of knowing how much we could borrow before setting our hearts on a particular house.
Even if you’re not yet ready to buy, gaining knowledge early can make a big difference when the time comes to take the plunge.
Step 3: Securing a Pre-Approval
Our mortgage broker helped us get pre-approval for a loan, which is essentially an indication from the bank of how much they’re willing to lend you. It’s a key step because it not only helps you set a budget but also gives you an idea of your “walk-away” price—knowing when a property is out of your financial reach.
Interestingly, we didn’t wait for our pre-approval to start looking at properties. Our mortgage broker gave us the green light to start house-hunting based on her confidence in our financial situation, so we felt comfortable browsing while we waited for formal approval.
Step 4: The Inspections Begin
House inspections during the pandemic were a unique experience. With restrictions in place, we had to book appointments with real estate agents and be mindful of social distancing. It wasn’t as simple as attending an open house on a weekend like we’d envisioned.
But inspections are crucial, especially when buying your first house. We needed to be extra meticulous, not just with the condition of the house itself but also with the neighborhood. After all, this was going to be our home. We wanted to make sure it suited our lifestyle and felt like a place we’d love for years to come.
Step 5: Making an Offer
We found a house we liked, and after a second inspection, we decided to make an offer. Initially, the property was set to go to auction, but with Melbourne entering another lockdown, the owners shifted to a private sale.
We made sure our funds were ready, as this can be a big advantage when negotiating. The seller accepted our offer, and we were able to secure a shorter settlement period—just 30 days, which was a major plus for the seller.
Step 6: Contract of Sale and Building Inspection
Once our offer was accepted, we sent the Contract of Sale to our solicitor for review. It’s important to have a legal professional look over everything to ensure there are no hidden issues or clauses that could cause problems down the line.
We also booked a building and pest inspection. Some people skip this step, but we wanted peace of mind. Having the inspection done gave us confidence that we weren’t buying into any hidden problems like mold, structural damage, or termites.
Step 7: Reviewing and Signing Loan Documents
Reviewing the loan documents was one of the final steps before settlement. We made sure to read through everything carefully. Our solicitor helped us understand the terms and conditions, and we made sure we were comfortable with every detail before signing.
Step 8: The Big Day—Settlement!
The settlement date finally arrived! This is when ownership of the property officially transfers from the seller to the buyer. All the funds are exchanged, the documents are finalized, and—most exciting of all—we became the legal owners of our new home.
Step 9: Getting the Keys and Moving In
Moving in during lockdown had its challenges, especially with the 5-kilometer travel rule. Luckily, our new house was within 5 kilometers of our rental property, so we could still move without breaking restrictions. It was surreal finally getting the keys and stepping into our home, knowing that all the hard work and sacrifice had paid off.
Reflecting on the Journey
Buying our first house was a rollercoaster of emotions—from excitement to stress to joy. It was something we only dreamed of when we first arrived in Australia, and now that dream is a reality.
Looking back, the journey taught us so much about discipline, patience, and the importance of seeking help from professionals like mortgage brokers and solicitors. It wasn’t an easy process, but it was worth it.
If you’re on the fence about buying your first house, take it from us—it’s a challenging but rewarding journey. And remember, you don’t have to do it alone. Surround yourself with knowledgeable professionals, keep learning, and stay focused on your goal.
Now that we’ve reached this milestone, we’re excited to see what the future holds as we continue to build our lives here in Australia.