VIC New Build | Now or later

Discussion in 'Where to Buy' started by Rahul Purumandla, 1st Apr, 2021.

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Is this a good time to enter into the market for first home buyers?

  1. Yes

  2. No

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  1. Rahul Purumandla

    Rahul Purumandla New Member

    Joined:
    28th Mar, 2021
    Posts:
    1
    Location:
    Melbourne
    Hello guys, I want to buy land in Mt Atkinson and build my first home. I am a permanent resident and not eligible for the home builder grant which ended yesterday. I wanted to get into the market after the homebuilder program has ended considering the sudden increase in land prices and the hyper activity in the new home space. I can now see that it was a wrong idea as it seems the prices have increased more than 25K for the land since the start of homebuilder scheme. I want to get into the market now and buy land, however there are few things that are bothering me:

    1) I have a feeling that prices in new suburbs with a lot of construction will drop significantly mainly because of the huge supply of new houses in an years time (outcome of home builder grant) and near zero migration. Home builder has an uptake of 75K and that is almost 1.5 times the average number of families that migrate to Australia (Pre-pandemic).

    2) QE program of RBA may create hyper inflation and the deposit I saved may loose more value

    3) Borrowing capacity of people have maxed out due to 0.1% cash rate. So, most of us are playing with our maximum borrowing capacity and the RBA may not reduce or go into negative interest rate zone.

    4) Bond Markets globally are indicating that the interest rates will go up the moment RBA stops QE

    Please let me know your thoughts.
     
  2. Stoffo

    Stoffo Well-Known Member

    Joined:
    14th Jul, 2016
    Posts:
    2,702
    Location:
    Sydney
    Yes prices have increased (not only just due to home builder) but I doubt they will drop
     
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  3. skater

    skater Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,582
    Location:
    Sydney
    Nobody has a crystal ball, so anything may, or may not happen. If there IS hyperinflation, then buying now has the advantage that if/when interest rates rise, so will your wages, plus the asset value would raise as well.

    The only thing people can do, which is no different to any time in the past, is to take each day as it comes, and do your best to protect for the future.
     
    Rahul Purumandla likes this.