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Evaluating the property market in Australia: Is now the time to buy or sell?

Evaluating the property market in Australia: Is now the time to buy or sell?

Jun 1, 2023 | Property Market

The decision to buy or sell property is always a tricky one, as it’s a significant financial step that involves careful consideration of various factors – including market conditions.

Whilst it’s important to know that real estate markets can be unpredictable, understanding the key indicators can help you to make an informed decision. So, let’s look at the factors influencing the Australian property market.

  • Low Listing Numbers = Increased Competition for Buyers

With decade-low listing numbers, there’s not a lot of competition in the market for vendors – but competition is fierce for buyers as they battle it out to secure a property. This is one of the reasons that selling conditions have strengthened, as evidenced by above average clearance rates, faster selling time and less negotiation.

The total number of homes listed for sale across Australia is currently 28% below usual (as reported by CoreLogic). When these volumes are low, selling conditions strengthen, meaning that potential vendors thinking about selling may jump in now rather than waiting until the traditional spring period where activity surges and there’s a spike in competition.

  • Rising Prices

Home values for Sydney, Melbourne, Brisbane and Perth all recorded an increase in housing values from the lows recorded in February. A mid-month update based on CoreLogic Australia’s daily Home Value Index showed the upswing gathering momentum, especially in cities such as Brisbane where the index is up 1.0% over the past four weeks whilst the Sydney property market still remains the strongest.. Considering housing affordability measures remain stretched such a strong rate of growth is surprising, with many experts predicting that this price rise will not be sustainable in the long term.

  • Low Supply vs High Demand

As mentioned above, decade-low listing numbers and high demand has lead to fierce competition between buyers – as seen in auction clearance rates that have been holding at 70% or higher in recent weeks.

In a time where the market traditionally tends to cool off, the stats suggest that, if anything, the market is gathering momentum instead of slowing down. Strong clearance rates as well as faster selling times and reduced discounting rates indicate that it’s definitely a vendor’s market.

Recent data from the National Housing Finance and Investment Corporation shows a 115,000 dwelling undersupply for 2028.

  • Interest Rates Continue to Rise

The biggest challenge for potential and current property owners? Interest rates. With interest rates continuing to rise, demonstrating an ability to service a loan remains one of the biggest challenges for prospective buyers to face.

Interest rates are high, but assessment levels are three percentage points higher again – making it even harder for buyers to enter the market or secure their dream property.

  • Economic Uncertainty

In addition to rising interest rates, we’re also in the midst of a cost of living crisis where consumer confidence is low.

Should RBA cut interest rates, there’s a good change we would see a pick-up in both buyer and seller activity. It’s also highly likely that lower interest rates would be the catalyst for a further uptick in housing values, however, we’re not expecting a rate cut anytime soon and there’s speculation that rates may continue to rise this year.

Economists are split on their forecasts with predictions for further rate hikes, stability and some cuts later this year – all contributing to uncertainty and low consumer confidence levels.

  • A Helping Hand

Government policies and regulations play a crucial role in shaping the property market. Policies related to taxation, lending practices, and housing affordability can have both direct and indirect effects on the market.

At the moment, first home buyers in particular have a wide variety of grants, concessions and schemes available to them (outlined in our First Home Buyer Update here) that could make purchasing a property easier and more affordable.

  • Migration Predicted to Recover

With net overseas migration set to fully recover to pre-pandemic levels there will be more pressure on the housing market than we’ve seen in recent years.

With the return of international students and the surge in migration, it is estimated that an extra half a million people will be looking for somewhere to live in Australia in the next two years.

  • Low vacancy rates bringing investors into the market

We are experiencing a rental crisis across the country, with historically low vacancy rates encouraging more investors into the market. Unfortunately for investors, rising interest rates and property prices have made this challenging – as well as rising building costs making it harder for investors and developers to buy and renovate or rebuild.

Is now the right time to buy or sell?

In short? Maybe. Unfortunately it’s not a one size fits all answer.

Ultimately, making an informed choice that aligns with your own circumstances and long term goals is key when navigating the property market.

Luckily, we’re here to help. We’ll sit down to work out what your goals are, what your property budget may be and how we can help you secure a property. Contact us today to get started!

First Home Owner Update – What’s changing on July 1

First Home Owner Update – What’s changing on July 1

May 9, 2023 | First Home Buyers, Government Grants

First Home Owner Update – What’s Changing on July 1

From July 1, 2023, the New South Wales Australian Labor Party (ALP) will implement changes that will impact the way many first home owners purchase property. To make the transition easier, we’re going to run you through some of these changes and how they could impact you.

Stamp Duty Concessions

The ALP will introduce changes to stamp duty for first home buyers. Currently, first home buyers are exempt from paying stamp duty on properties valued up to $650,000, and receive a concession on properties valued between $650,000 and $800,000.

From July 1, 2023, these thresholds will be increased to $800,000 and $1 million respectively, providing even more support for those looking to purchase their first home.

Changes to the First Home Owner Grant

On July 1, the First Home Owner Grant will be increased from $10,000 to $25,000 for eligible first home buyers purchasing a newly constructed home or an off-the-plan property. This grant will be available for properties valued up to $1 million, and will provide a significant boost to those trying to get into the property market.

Removal of  the Home Buyers Buyer Choice Scheme

Under the newly elected Minns Labor Government, the NSW Government will now abolish the First Home Buyer Choice scheme, reverting to the new stamp duty concessions as mentioned above.

Over 4,200 First Home Buyers had selected the First Home Buyer Choice options since it was rolled out in November 2022.

For those First Home Buyers who had already selected the property tax option there will be a grace period and it would be unlikely that the new NSW government would reverse any existing arrangements. We will continue to monitor this and keep you updated.

First Home Guarantee Eligibility to Expand

Previously, the First Home Guarantee and Regional First Home Guarantee Schemes were restricted to married and single people, as well as those in defacto relationship who were also Australian citizens at the time of application.

From July 1 this year, the Home Guarantee Scheme will expand, allowing permanent residents to access the scheme as well as allowing friends, siblings and other family members to jointly apply for the guarantees. These schemes will also be available to non-first home buyers who have not owned a property in the past 10 years.

For both of these schemes, the federal government acts as a guarantor on up to 15% of the loan. This enables eligible buyers to purchase a home with as little as a 5 percent deposit, eliminating the need for lender’s mortgage insurance.

Family Home Guarantee Changes

The criteria for Family Home Guarantee applications will also be expanded beyond just single natural or adoptive parents with dependents. This means that the guarantee will be available to eligible borrowers who are single legal guardians of children, such as aunts, uncles and grandparents.

Under the Family Home Guarantee, the federal government acts as a guarantor on up to 18% of the loan. This enables eligible buyers to purchase a home with as little as a 2 percent deposit, eliminating the need for lender’s mortgage insurance.

The availability of this guarantee will also expand to include permanent residents in addition to Australian citizens.

How do I know if I’m eligible?

Our team will help you identify which Guarantees could be applicable to you under the Home Guarantee Scheme (HGS)

We’ll help you find the right path to owning your own home and will be with you every step of the way. To get started, simply get in touch to organise a call or meeting.

What is a Bridging Loan and When Should You Use It?

What is a Bridging Loan and When Should You Use It?

Mar 9, 2023 | Bridging Loan, Purchase, Uncategorized

Finding your dream home when you haven’t yet sold your previous home can be stressful – but that’s where bridging finance can help.

What is a Bridging Loan?

A bridging loan (or bridging finance) is short-term loan, generally lasting for up to 12 months or until the sale of your old property.

The idea is that the loan creates a financial “bridge”, allowing homeowners to purchase a property before selling their previous one – but there are many aspects to this style of loan that should be considered before signing.

How does a bridging loan work?

Here is a quick example to show you how the process may work

What is bridging finance and how does it work?


What are the benefits of a bridging loan?

  • Fast Approval
    Bridging loans are typically approved quickly, often within a few days, allowing you to secure your dream home faster.
  • Convenient
    A bridging loan allows you to look for and purchase a property without having to wait for your current home to sell. This means you could purchase the dream home you find unexpectedly – or secure a place to live without having to worry about renting between selling and purchasing etc.
  • Flexible Repayments
     The structure of your loan can vary, however, bridging loans typically offer flexible repayment terms, including interest-only repayments, lump sum repayments or the option to repay the loan once your old property has sold.
  • No Need for Temporary Accommodation
    If the timing is right with your bridging loan and your sale/purchase, it’s possible to avoid the cost and hassle of having to rent a home, living with friends or relatives or negotiating a longer (or shorter) settlement period to ensure you have somewhere to live.
  • Avoid Property Chains
    Bridging loans can help you avoid property chains, which can be complex and time-consuming, allowing you to move into your new home faster.
  • Flexibility
    Bridging loans provide flexibility and can be tailored to your unique financial situation, giving you peace of mind knowing that you have the financial support you need to purchase your dream home.


What are the downsides of a bridging loan?

  • Time limits12 months can go by very quickly and a time limit may mean you have to sell your old property at a lower than expected price just to get the sale finalised. If you don’t sell your home in the required time, you could be left with a large interest bill or risk the bank stepping in to sell your property.
  • The selling price risk
    Speaking of lower selling prices, if your property sells for less than expected you may be left with a larger ongoing loan amount – increasing repayments, interest etc and potentially causing financial difficulty.
  • Additional Costs
    Bridging finance may require two property valuations (your existing and new property) which could mean two valuation fees, as well as other fees and charges that come with the loan.
  • Termination Fees
    If your current lender doesn’t offer a bridging loan, you’ll need to switch to a lender who does offer these loans – potentially resulting in early exit fees from your current loan.
  • Interest and Interest Rates
    Interest is usually charged on a monthly basis, so the longer it takes to sell your property, the more interest your new loan will accrue. If you don’t sell your home within the bridging period, you will also typically be charged a higher rate.

How do I know if a bridging loan is right for me?

As everyone’s financial situation is different, it’s important to speak to a professional and do your own research before deciding if a bridging loan is right for you. At Sanford Finance, we’ll work with you to determine the right options for your unique financial situation – finding the right loan options, ensuring you are looking for properties you can afford and walking you from the first steps through to settlement and even refinancing in the future to ensure you always have the right loan for your needs.

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Construction costs continue to soar at record rates

Construction costs continue to soar at record rates

Nov 1, 2022 | Construction Loan


Building your own home certainly sounds like a dream. From the floor plan to the flooring, every detail can be customised to your tastes – but this dream has become a nightmare for many Aussies building or looking to build in the current market.

CoreLogic’s Cordell Construction Cost Index (CCI) for Q3 2022 showed that national residential construction costs have increased at a record rate in the year to September 2022, recording the highest annual growth rate (excluding the period impacted by the introduction of GST).

Cost have increased by 11% over the 12 months to September 2022. The quarterly figure was also higher at 4.7%, compared to 2.4% in the previous quarter. This was above the 3.8% surge recorded over the three months to September 2021 when COVID lockdowns were having a more significant impact on domestic supply chains.

Unfortunately for Australians looking to build, the cost is only expected to rise further, with CoreLogic’s Construction Cost Estimation Manager, John Bennett, commenting that the team are continuing to see price increases, particularly across timber and metal materials.

With building materials increasing in price, many suppliers have little choice but to pass on price increases. John also commented that this quarter has also shown a larger increase in materials that were previously stable, such as wall linings including plasterboard and fibre cement. Even your front door will now cost you more with sharp price rises.

Whilst sea freight prices have begun to stabilise, the increasing cost of raw materials, labour and fuel continues to place upward pressure on residential construction costs.

So what is the outlook? Mr Lawless said that ongoing labour shortages and supply issues meant that these conditions would likely remaining challenging with little reprieve expected in the short to medium-term. “There’s no quick solution for providing additional materials and fuel costs remain elevated. All of these factors have an impact and are likely to push building costs higher for some time yet.”

Thinking about building or reconsidering your options?

We’re here to help. Whether you have your heart set on building or renovating or are unsure of what to do next, our team is here to help. We’ll sit down together to look at your options and come up with a plan that’s right for you. Contact us today to find out more.

How your daily spending is impacting your borrowing power

How your daily spending is impacting your borrowing power

Oct 4, 2022 | Borrowing Power

Your morning coffee, a quick lunch with your colleagues, ingredients for dinner, your Netflix subscription… ordinary day-to-day expenses, but did you know that these can considerably reduce the amount you are eligible to borrow, even if you are a high income earner?

If you’re planning to buy a home, now might be the time to Spring clean your expenses and set yourself a weekly budget and here’s why:

Why do lenders care about living expenses?

Mortgage brokers and lenders are required to meet ‘responsible lending’ guidelines under the National Consumer Credit Protection Act (NCCP). These guidelines are designed to ensure that a borrower can afford to make the repayments on their loan without suffering ‘substantial hardship’.

This means, by law, all mortgage brokers and lenders must ensure that you have plenty of money left over from your income to repay your loan after you have covered your regular financial commitments.

What are living expenses?

A living expense is defined as anything that you spend your money on. Your morning coffee, Netflix subscription, monthly dinner out with friends and gym membership all count – even if you don’t see them as essential or could easily live without them.

When applying for a loan, we have to perform a thorough living expense and income assessment which determines your true financial position – and all of these expenses are included.

According to a 2018 survey by UBank, 86% of Australians don’t know how much money they spend every month on their living expenses – and those small expenses can quickly add up.

Without tracking your purchases, it’s easy to spend more than you earn without even realising – especially if you use a credit card.

But what if I plan to change my spending habits?

You might think “once I buy a property I’ll….”, but to most lenders, all that matters is how you’re spending money now.

Tips for controlling your living expenses

In order to control your living expenses, you first need to know where your money is going.

ASIC have a free MoneySmart Budget Planner that is a great place to start and it can be downloaded here. Another great tool from ASIC is the MoneySmart TrackMySpend app which helps you to record your weekly household budget, nominate spending limits, separate ‘needs’ from ‘wants’ and kickstart your savings goals.

How do we perform a living expenses assessment?

As mentioned, as part of the borrowing process, we need to conduct a thorough living expenses assessment. To do this, we’ll provide you with a Needs Analysis Questionnaire to help you work out your living expenses.

These expenses are divided into simple categories, including:

  • Childcare
    Including formal day care, nannies and occasional babysitters or childminding services.
  • Personal Care
    Clothing, footwear, cosmetics, personal hygiene products, hairdressing, manicures, massages etc.
  • Education
    All educational costs/fees for the borrower and any dependents, including books, uniforms, equipment and excursions.
  • Groceries
    This includes meat, fruit, vegetables and anything you might buy from a supermarket, including cleaning products.
  • Insurance
    This includes health, home, car, life, pet and all other insurances you may have.
  • Medical
    Doctors visits, dental care, pharmaceutical prescriptions, optical etc.
  • Utilities and Home Expenses
    Gas, water, electricity, rates, taxes, levies and any other costs for running your own home.
  • Entertainment
    Movie tickets, take away food, club memberships, gifts, holidays, hobbies and all recreational expenses.
  • Connections
    Includes expenses such as mobile phone plans, internet, home phones, magazine subscriptions, streaming services etc.
  • Transport
    Including personal vehicle expenses like petrol, tolls, insurance and car registration as well as public transport, car parking, car servicing and maintenance.
  • Rent
    This is for rent on a property that you live, board (if you are living with your parents or renting a room) or similar housing costs.
    Note: If you are buying a home you intend to occupy, rental expenses are not included as part of your living expenses assessment.
  • Investment Property Expenses
    Including any costs you are responsible for paying, such as council rates, insurance, property management fees, taxes and levies, body corporate and strata fees, maintenance etc.
  • Other
    All other expenses that do not fit into the above categories.

When should I cut back on expenses?

If you’re planning on purchasing a property, the best time to start is now. Regardless of whether you’re purchasing a home for yourself or an investment, it’s important to know how much you’re spending and where.

Remember that a lender will only give you a loan for an amount you can afford to repay, so cutting back on your everyday spending could give you increased borrowing power and will maximise the chances of your loan getting approved the first time.

Where do I start?

We are happy to run through your living expenses and help you find ways to budget and increase your borrowing power. Just contact our team via the website here, or give us a call on (02) 9095 6888.