When is the best time to buy a house?

Buying a house is a significant financial undertaking that requires careful thought, planning, and thorough research. Due to the rapidly shifting real estate landscape and fluctuating interest rates, buyers may be hesitant to jump right in and purchase a property. 

Many Australian homebuyers are factoring the timing of their home purchase in relation to housing market projections. However, even if the market is ripe for homebuyers, if your personal finances can’t handle it, then it’s not the right time for you. 

So, when should you buy a house? And what difference does it make when buying now or later? 

Overview of the Australian real estate market 

For those wanting to buy a home, it’s best to consider the current state of the real estate market. According to the latest reports from the Australian Bureau of Statistics (ABS), the mean dwelling price across Australian states and territories is $1,016,700. The highest value prices can be found in New South Wales ($1,256,200), while the lowest mean price is in the Northern Territory ($523,400). 

It’s also a good idea to watch out for any rate changes, as they affect the interest rates on home loans. The most recent data from ABS shows that the average mortgage size is $678,000. If we break this down, at an indicative 5.29% variable rate p.a. over a 30-year term, we’d get monthly repayments of $3,761 with a total interest cost of $675,870. 

When it comes to the future of Australian real estate, Domain’s Price Forecast Report Financial Year 2025-2026 predicts a jump in house prices. Domain’s report attributes the lack of national housing supply compared to the demand due to population growth as one of the main drivers for the potential house price increase.  

Knowing the average house prices, mortgage size, and market projections can help you prepare for your home purchase. It makes it easier to set expectations and ensure that your finances can handle the commitment of buying a home. 

When is the best time of the year to buy a house? 

Aside from general market trends, homebuyers should also be aware of seasonal changes that could affect the number of properties listed for sale, as well as the slight differences in house prices. 

Late autumn or early spring are usually considered the best months of the year to buy property in Australia. This allows sellers to take advantage of the warmer weather and maximise their homes' curb appeal. Buyers with families tend to buy during the spring months so they can move in before the school year begins. 

Meanwhile, the autumn to winter months may see fewer properties listed on the market. This can make it difficult for those who are looking for a specific type of property. During this time, buyers can typically find better deals as markets slow down over the season, and sellers get anxious about selling off their properties. 

Changing seasons do affect the real estate market in Australia; however, it still varies depending on where you’re buying the property. Capital cities may see a significant increase in properties for sale during spring, while rural areas may not. Places with warmer climates may also have a longer busy season compared to those found in colder states.  

What are the signs you’re ready to buy a house? 

Regardless of market trends or time of the year, the best way to know if you should buy a house or wait is by reviewing your personal finances. Rates may be at their lowest, but if you’re not financially ready, you may not see the results you want. If you’re unsure about starting your home-buying journey, you should speak with a financial planner. Some factors that will impact whether you could be ready to buy a house include: 

You have the deposit 

Saving up for the deposit is one of the most important and difficult steps when buying a house. Usually, your deposit should be at least 20% of the sale price of the property you want to buy. If you put down a 20% deposit or have a loan-to-value ratio of 80%, you won’t have to pay for Lenders Mortgage Insurance (LMI).  

Although it’s unlikely that lenders will offer 100% of a property’s purchase price for a loan, some lenders, like loans.com.au, allow borrowers to put down as little as a 10% deposit when taking out a loan.  If you’re a first-time homebuyer, you can look into government schemes to help you with your deposit. 

You have a reliable income and savings 

You need the means to pay off your home loan. Review your current income, debt, and expenses to ensure that what you’re making is enough to make mortgage repayments possible. 

You have a good credit score 

A good credit score can usually help you get approved for financing with lower rates and good loan features. Before you apply for a home loan, it’s best to check your credit score to see if you’re in a good range. This allows you to improve your credit score in preparation for your home purchase. 

You’ve figured out your financing 

The home loan you choose affects the overall cost of your loan and how easy it will be for you to manage. Plus, your home purchase hinges on getting financing. If you have your financing sorted, especially if you already have a pre-approved loan, then buying a home may be less stressful.  

At the end of the day, the journey to buying a home isn’t a race. Don’t rush and carry on at your own pace, ensuring you’re financially and mentally ready to take on homeownership before you jump into the Australian real estate market. 

If you want to learn more about your home loan options, get in touch with us at loans.com.au! Call 1300 721 469 or start your application online today.  

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