After the latest raise in interest rates everybody are talking even more about housing affordability crisis. The builders say that people who don’t already own a house (which they can sell) simply can not buy a house. “First home buyers just aren’t buying”, they say.
So how do you check what kind of house (if any) you can afford? First, you need to see how much money you can spend – to get an idea what your limits are. Probably a good idea would be to play with one of the mortgage calculators – here is an example.
Try setting different loan amounts and see how much money you will have to pay every month, based on that choose the amount that you can borrow and repay.
To see what the value of any kind of house is, you are going to need an estimate. As you know, any information in our time is for sale, so it will cost you – but try to pay as little as possible. You can get away with paying as little as $10 if you buy the “Guide to Property values” online and download it to your computer.
Don’t forget that the price of the house is only a part of your expenses. You have to pay for many additional things such as stamp duty, land tax, solicitor fees, mortgage application and registration fees, building inspection fees, etc. All of those are described really well here – click to see list of costs.
So add the extra expenses to the price of the house and you will end up a real cost of a house.