Is it harder to buy a home now?
Reflecting on a decade of facilitating home, investment, and self-employed loans, one might question: Has the process of purchasing a home become more challenging than it was ten years ago?
In assessing borrowing capacity, three primary factors are taken into account:
Net Income, the magnitude of your deposit, and the varying policies of lenders. These policies can significantly influence the outcome of loan approval and the extent of borrowing capacity, potentially affecting it by tens or even hundreds of thousands of dollars.
LENDER POLICY NICHES – ACCESS by a BROKER
The landscape of lender offerings is diverse:
Some do not provide pre-approval services, and there are specific loan-to-value ratio (LVR) limitations contingent upon one’s credit history, the property type, or its location. Factors such as credit score, types of loans for construction, the utilisation of equity as cash (with or without proof of its intended use), the origin of your deposit (whether saved or gifted), living expenses, and the stability of your income sources (including overtime, commission, casual income, or self-employed earnings) play a critical role. This list is extensive, and by only consulting with the bank where you hold an account, you might not fully grasp your true borrowing potential.
So, does this make borrowing more difficult today?
Despite the rise in individual earnings and the availability of government initiatives aimed at first-time homeowners, which cover stamp duty and lenders mortgage insurance (LMI), and the possibility to secure loans with no down payment or a minimal 2.2% fee for 100% financing, buying a house remains a substantial commitment. However, with the right knowledge and understanding of what one can afford, it is an attainable goal for many.
As a broker, I take pride in assisting you to comprehend your borrowing limits and the type of property you can finance.
P.S. Let’s not delve into the discussion on restricting immigration until there’s sufficient incentive for investors or developers to increase the housing supply!
Kelvin
#buyinvestlive