Understanding the Unit Market for First Home Buyers
Purchasing your first unit represents an excellent entry point into the property market, particularly for buyers in Perth and Fremantle. Units typically require a lower purchase price compared to houses, making them an attractive option for those buying their first home. The application process for financing a unit follows similar steps to other property types, though specific considerations apply.
Financial Requirements and Loan Amount Considerations
When applying for a home loan to purchase a unit, your borrowing capacity depends on several key factors:
• Your financial situation, including income and expenses
• Bank statements demonstrating savings patterns
• The loan to value ratio (LVR) you can achieve
• Your ability to pay lenders mortgage insurance (LMI) if required
Most lenders require a minimum deposit of 5-10% of the purchase price, though a 20% deposit helps avoid LMI costs. Home Finance & Mortgage Brokers can access home loan options from banks and lenders across Australia, providing multiple financing solutions for your unit purchase.
First Home Owner Grants and Schemes Available
Western Australian first-time buyers can benefit from various first home owner grants (FHOG) and first time home buyer schemes. These programs include:
- First Home Owner Grant of up to $10,000 for eligible purchases
- Stamp duty concessions or exemptions for qualifying buyers
- First time home buyer programs offering reduced deposit requirements
- Keystart loans for those meeting specific criteria
These benefits can significantly reduce the upfront costs of buying a home, making unit purchases more affordable for first-time buyers.
Interest Rate Options and Loan Packages
Understanding interest rate options helps you choose the most suitable loan structure:
Variable Interest Rate Options:
• Rates that fluctuate with market conditions
• Often include offset account facilities
• May offer interest rate discounts for certain packages
Fixed Interest Rate Options:
• Locked rates for specified periods
• Provide payment certainty during the fixed term
• Protect against rate increases
Many lenders offer combination loans, allowing you to split your loan amount between variable and fixed portions. Access to banks and lenders nationwide through experienced brokers ensures you can compare various packages and select optimal terms.
The Application Process for Unit Purchases
The streamlined application process for unit purchases typically involves:
- Pre-approval Stage: Get pre-approved to understand your borrowing capacity
- Property Selection: Choose your unit within the approved loan amount
- Formal Application: Submit complete documentation including bank statements
- Valuation: Lender arranges property valuation
- Approval: Final loan approval and settlement preparation
Getting pre-approved before property hunting provides confidence when making offers and demonstrates serious buyer intent to vendors.
Special Considerations for Unit Purchases
Unit purchases involve specific factors that differ from house purchases:
• Strata Fees: Ongoing body corporate fees affect borrowing capacity calculations
• Building Insurance: Often included in strata fees but verify coverage
• Rental Potential: Consider future investment loan options if circumstances change
• Location Factors: Proximity to amenities affects both liveability and resale value
Investment Loan Application Considerations
While purchasing as your first home, understanding investment loan application processes proves valuable for future property acquisitions. Your first investment property purchase will benefit from the experience gained through your initial unit purchase. Investment loan options typically require higher deposits and different assessment criteria compared to owner-occupier loans.
Working with Professional Mortgage Brokers
Professional mortgage brokers provide access to extensive lender networks, comparing loan products to match your specific requirements. They assist throughout the entire process, from initial borrowing capacity assessments through to settlement.
Brokers can identify suitable first home loan products, explain complex terms like loan to value ratios, and ensure you maximise available grants and concessions. Their expertise becomes particularly valuable when dealing with unit-specific lending policies that vary between institutions.
Regional Considerations for Perth and Fremantle
The Perth and Fremantleproperty markets offer diverse unit options across various price points. Consider factors such as:
• Transport links and infrastructure development
• Local employment opportunities
• Planned residential and commercial developments
• School zones and community facilities
These elements influence both immediate liveability and long-term property value growth.
Purchasing your first unit represents a significant milestone in building wealth through property ownership. With proper planning, appropriate financing, and professional guidance, first-time buyers can successfully enter the property market through unit purchases.
Call one of our team or book an appointment at a time that works for you to discuss your first home loan requirements and explore suitable options for your unit purchase.
