Mortgage and Property Guide Melbourne

Buying Real Estate - Melbourne - Mortgages, Money and Finance

First Home Owner Grant - A Gift from the Government
Anyone who buys a house in Australia for the first time (including migrants with permanent residence) is eligible for the First Home Owner Grant of $7,000. This sum is paid directly to the buyer of a house. (This grant is not payable for buying land.)

Welcome as it is, $7,000 will not buy you a house in Australia. Unless you have substantial savings, you will need to get a mortgage.

How Much Can You Borrow? - Mortgage Limits
The amount of money you can borrow for a mortgage depends on the lender. Lenders typically use your salary to decide the maximum amount they will lend you. On average, lenders allow couples to borrow 5 times their joint pre-tax income. Some will lend more, some less. If you need a mortgage, many lenders prefer you to be settled into a job for a few months before offering you a mortgage.

Stamp Duty on Property Purchases in Melbourne
When you buy a property, you will have to pay tax on the purchase price. This is called Stamp Duty. First time buyers, especially of lower priced properties, may get a discount on stamp duty. The rate of stamp duty you pay depends on the house price. The more expensive the house, the more tax you pay. Each Australian state levies stamp duty at different rates.

A buyer in Melbourne in 2010 would pay stamp duty as follows:

House Price	Stamp Duty
$250,000	$8,870
$400,000	$16,370
$500,000	$21,970
$700,000	$37,070

Stamp Duty on your Mortgage
When you raise a mortgage, most Australian states levy a tax on the amount you borrow. This is called Mortgage Stamp Duty. Mortage stamp duty was abolished in Victoria in 2004.