• Alternative ways to get on the property ladder

    Alternative ways to get on the property ladder

    House and land packages

    For first home buyers, one alternative option to buying an established home is to purchase a new house and land package. These packages provide a new home on your own block of land (often within a housing estate) plus warranty protection on all construction (always ask the builder about warranties). The downside is that housing estates are usually quite far away from the city, which can put some distance between your family/friends and place of employment, resulting in more reliance on your car as a mode of transport.

    For others searching for an established home, the sheer competition amongst buyers in the lower price ranged suburbs means prices still remain high. Don’t give up, and remember, like any journey it’s where you finish that’s most important and the property journey is no different!

    Units or apartments

    Units or apartments can represent an easier and more affordable way into the property market for many first time buyers – and if you buy the right type of property, such as an older style apartment or a unit with some external garden area, there can be the real opportunity to increase the capital value by renovating, modernising or updating the property (subject to Council Approval and any Body Corporate or Strata considerations).

    Additionally, for singles, younger couples or small families, units and apartments can also mean lower maintenance costs and time, allowing the ‘breathing space’ to get established career-wise and financially, or before you need additional a larger home space.

    I would avoid buying off the plan, as there is uncertainty about completion dates, market value at time of completion and you are still spending money on alternative accommodation in the interim, as well as minimal opportunity to add value and build equity in the short term. I would also consider smaller developments comprised of 4-6 unit or apartment dwellings.

     

    About the author

    • Andrew Wilson

      Dr. Andrew Wilson, Senior Economist for Fairfax-owned Australian Property Monitors and Domain.com.au is our numbers man on The Great Australian Dream. As a leading commentator on the Australian property market, specialising in housing market analysis, Andrew has a strong following with weekly columns in the Sydney Morning Herald and Melbourne Age.

      Throughout the series, Andrew will help home buyers understand what the numbers really mean and reveal the forces driving the Australian property market whilst breaking down the jargon along the way. Dr Andrew Wilson has previously held senior property and construction research positions within industry, academia and government as well as holding a PhD and Masters in Research in Housing Market Economics.

      Andrew Wilson
     

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    The information here is of a general nature only and is not intended to constitute financial or tax advice. You should consult your professional adviser, accountant or taxation expert for advice specific to your personal circumstances.

    The views and opinions expressed in this article are those of the author alone and do not necessarily represent the views or opinions of RAMS Financial Group Pty Ltd ABN 30 105 207 538 (RAMS),  Westpac Banking Corporation ABN 33 007 457 141 (Westpac) or their related bodies corporate. This article is strictly for information purposes only and neither RAMS, Westpac nor any of their related bodies corporate make any representation as to the accuracy or completeness of the information in this article or endorse the views expressed in it.