widnesian

Hi all,

We are looking at moving to brisbane suburbs. We will be renting at first but in order for us to buy in an area we can afford we were just wondering what deposits you would need roughly for a mortgage. is it around 20% of purchase price.

Any info welcome, as I said its just a rough idea we are looking for.

Many thanks

Bermudashorts

Best to aim for 20% as a minimum yes.

Alfresco

As Bermudashorts said, best aim for 20%. Then you won't pay Mortgage insurance.

You can buy with 10%, as I did, but then they add the MI onto the loan.

old.sparkles

And don't forget all the costs involved which can be higher than UK - mortgage advisor told me to allow around another 6% to cover fees and other costs

bcworld

That sounds quite high but I assume relates mostly to stamp duty? Stamp duty rates are high in SA and even worse in Vic I think...but fortunately for the OP they are much lower in Qld.

old.sparkles

Yeah mostly stamp duty I think which is quite high here - around 4% I think (for my price range anyway)

Alfresco

Stamp duty in QLD is very low compared to there.

http://www.varcalc.com.au/calculators/main/640AU/stampduty.asp

jane_cornell

Like others have advised, it's best to have 20% deposit to avoid LMI (Lenders Mortgage Insurance).

But if your budget is tight, you can still purchase a house with 10% deposit only and pay some monthly fee on the mortgage insurance.

Other costs involved in purchasing a property are:
- Stamp duty: varies depending on the purchase price and whether it's your first home or not
- Solicitor's fee : around $1000-$2000
- Building and pest inspection: around $500

JOE2010

Stamp duty is exempt for most states for first home buyers ( in WA it is).

old.sparkles

Not exempt here in SA - other than WA, do you know which other states?

Alfresco

WA, QLD & NSW.

http://www.realestate.com.au/blog/st...ty-calculator/

old.sparkles

Thanks Alf

Just had a quick look and SA does seem to be the most expensive on that front

Bermudashorts

NSW does not appear to be exempt.

jackieh23

WA we use Settlement Agents not solicitors and cost is significantly lower than quoted #8.

LMI has to be paid up front and is normally incorporated into the loan, resulting in a small increase in monthly repayments.There are organisations that will allow a 95%/97% loan with LMI.

Re WA: First home buyers may qualify for the First Home Owners Rate (FHOR) which is a reduced rate for purchase of a home under $600,000. No duty is payable for homes under $500,000.

To be eligible for FHOR of duty, the unencumbered value of the vacant land must not exceed $400,000. For land under $300,000 no duty is payable.

chris955

Just to remind people that the OP is looking to buy in Queensland so the situation in other States isnt really relevant.