The essential Australian property buying guide
From pre-approval to settlement, navigate your property purchase with confidence using real market data and expert guidance.
Ready to move from market research to ownership? This comprehensive guide streamlines your property purchasing journey with data-driven insights at every step.
Explore each step of the buying process
Mahendra Duddempudi
CTO & Head of Research
Updated on 07 Oct 2025
Get pre-approved & set your budget
Focus on calculating your borrowing capacity, understanding costs, and getting a formal home loan pre-approval.
How much can I realistically borrow?
Your borrowing capacity depends on your income, expenses, and current lending standards. Here's what you can typically borrow at different income levels.
💡 Key Insight: Average Australian earner (~$100K) can borrow approximately $346,810 based on current lending standards (8.5% assessment rate, 32% serviceability cap).
How has the cash rate affected borrowing power?
Rising interest rates directly reduce how much you can borrow. Here's how borrowing capacity for a $100K earner has changed with RBA cash rate movements.
💡 Key Insight: When cash rates rise, borrowing capacity falls. The RBA's rate increases since 2022 have reduced typical borrowing capacity by approximately 15-20% for most buyers.
First home buyer schemes
Australian government 5% deposit scheme
Buy your first home with just 5% deposit (2% for single parents) - no lenders mortgage insurance (LMI) required
Key benefits
- No income caps - eligibility based on serviceability
- Government backing - wide lender participation
- Unlimited spots - no waiting list
- No LMI required - significant cost saving
Eligibility
- Australian citizen or permanent resident
- First home buyer (never owned property)
- At least 18 years of age
- Property price within regional caps
- Must live in the property
First home super saver scheme
Save for your first home deposit inside your super fund and withdraw up to $50,000 plus deemed earnings
Key benefits
- Tax-effective savings - lower tax on super contributions
- Up to $15,000 per year voluntary contributions
- Maximum $50,000 total withdrawals
- Deemed earnings included in withdrawal
Eligibility
- First home buyer (never owned property)
- Make voluntary super contributions
- Request release for property purchase
- Must sign contract within 12-14 months of release
Ready to get pre-approved?
Calculate your exact borrowing capacity, check if you're overpaying on your current loan, or connect with a mortgage broker.
Research property & suburb due diligence
Compare markets, research suburbs, and know what to look for when inspecting properties.
Which states offer the best value?
Compare mean dwelling prices across major Australian states to identify markets that match your budget and investment goals.
💡 Key Insight: Dwelling prices vary significantly across Australian states, with differences exceeding $500K between highest and lowest. Consider interstate opportunities if remote work is feasible, or focus on high-growth yet affordable markets for better value.
Where is the market growing fastest?
Track price trends across states since 2020 to identify which markets are experiencing the strongest growth or offer better entry points.
💡 Key Insight: Market timing matters. States experiencing recent price corrections may offer better entry opportunities, while high-growth markets may indicate strong demand but higher competition.
Suburb due diligence checklist
Essential factors to research before choosing a suburb. Take your time with this - your suburb choice matters as much as the property itself.
Location & accessibility
- Proximity to work, schools, and amenities
- Public transport options and connectivity
- Future infrastructure developments (roads, rail, etc.)
- Walking distance to shops, cafes, and services
Market & growth potential
- Historical price growth trends
- Rental yield and vacancy rates
- Supply vs demand dynamics
- Upcoming developments and rezoning plans
Safety & lifestyle
- Crime statistics and safety ratings
- Quality of local schools
- Parks, recreational facilities, and green spaces
- Community demographics and vibe
Property specifics
- Recent sales of comparable properties
- Building and pest inspection reports
- Flood and bushfire risk zones
- Council zoning and future development restrictions
Property inspection essentials
What to look for during property inspections. Always get professional building and pest inspections before making an offer.
Professional inspections are essential
DIY inspections help you shortlist, but always hire licensed building and pest inspectors before making an offer. Typical cost: $400-800, potentially saving you thousands in hidden repairs.
Need help with your property search?
Get expert guidance on property research, suburb analysis, and finding the right home for your needs.
Making a formal offer or bidding
Understand your options for making an offer through private treaty or competing at auction. Learn negotiation tactics and bidding strategies to secure your property at the right price.
Offer strategies
Private treaty (standard offer)
Submit a written offer through your agent with conditions attached.
✓ Pros:
- • Time to conduct due diligence
- • Negotiate terms and price
- • Include conditions (finance, building inspection)
- • Less pressure than auction
✗ Cons:
- • Seller may reject and counter-offer
- • Property may be sold to another buyer
- • Longer settlement process
- • May miss out to higher bidder
Unconditional offer
Submit an offer without conditions to strengthen your position.
✓ Pros:
- • More attractive to sellers
- • Higher chance of acceptance
- • Faster settlement
- • Shows serious intent
✗ Cons:
- • Higher risk if issues arise
- • Need finance pre-approval
- • No cooling-off period in some states
- • Must be confident in property condition
Best and final offer
Submit your highest offer when seller requests final bids from multiple buyers.
✓ Pros:
- • Competitive but controlled environment
- • One shot to secure property
- • Avoid auction pressure
- • Know your maximum upfront
✗ Cons:
- • No room for negotiation after
- • May overpay if others bid lower
- • Seller may still reject all offers
- • Need to decide quickly
Auction bidding
Compete openly with other buyers at a scheduled auction event.
✓ Pros:
- • Transparent process
- • Know competitors in real-time
- • Immediate outcome
- • Can secure property on the day
✗ Cons:
- • High pressure environment
- • Risk of emotional bidding
- • Usually unconditional sale
- • Must have finance ready
Essential auction tips
Attend multiple auctions beforehand
Observe the process, pace, and bidder behavior at 3-5 auctions before your target property. This builds confidence and understanding.
Set a maximum bid and stick to it
Decide your absolute limit before attending. Write it down and commit. Auction adrenaline can push you beyond your budget.
Register early and get your bidder number
Arrive 15-30 minutes early to register, review contract, and settle your nerves. Late registration adds unnecessary stress.
Bid confidently and clearly
Use strong, clear hand signals or verbal bids. Hesitation signals uncertainty. Decisive bidding can deter competitors.
Watch for vendor bids
The auctioneer can place bids on behalf of the seller (before reserve is met). These don't commit the seller but push the price up.
Negotiate after auction if property passes in
If property doesn't meet reserve and passes in, you can negotiate privately. You have 5-10 minutes before others can bid.
Bring your solicitor or conveyancer details
If you win, you'll need to provide legal representative details immediately. Have business card or contact info ready.
Understand the auction conditions
Review the contract before auction day. Auctions are typically unconditional sales with immediate binding contracts.
Negotiation checklist
1Pre-offer preparation
- Research recent comparable sales in the area
- Get pre-approval for finance
- Complete building and pest inspections (if possible)
- Understand the seller's motivation and timeline
- Review contract terms with solicitor
- Know your walk-away price
2Making your offer
- Start below your maximum but within reasonable range
- Clearly state offer price and conditions
- Specify settlement period (30, 60, or 90 days)
- Include deposit amount (usually 10%)
- Set a reasonable response deadline (24-48 hours)
- Get everything in writing
3Negotiation tactics
- Be prepared to walk away
- Don't reveal your maximum budget
- Use building/pest report findings as leverage
- Offer flexibility on settlement date if it helps
- Consider including chattels (furniture, appliances) in negotiation
- Stay calm and professional throughout
4Sealing the deal
- Review counter-offer carefully
- Consult with your solicitor before accepting
- Ensure all agreed terms are in final contract
- Check cooling-off period rules in your state
- Arrange deposit payment method
- Confirm settlement date and conditions
⚠️ Common mistakes to avoid
Making an offer without pre-approval or finance certainty
Skipping building and pest inspections to save money
Getting emotionally attached and overpaying
Not reading the contract thoroughly before signing
Failing to include necessary conditions (finance, inspection)
Bidding without understanding auction rules and process
Not having legal representation during the process
Revealing your maximum budget to the agent
Making decisions under pressure without consultation
Ignoring red flags discovered during inspections
Not budgeting for stamp duty, legal fees, and other costs
Assuming you can negotiate after winning an auction
Ready to make your offer?
Get expert guidance on negotiating your property purchase or explore pre-approval options before making your offer.
Legal finalisation & settlement
Navigate the legal process from contract review to settlement day, understanding each step to ensure a smooth transfer of ownership.
Key legal processes
Contract review
A thorough examination of the sale contract by your solicitor or conveyancer to identify any issues or unfavorable terms.
Conveyancing process
The legal process of transferring property ownership from seller to buyer, managed by a solicitor or conveyancer.
Settlement day
The final day when ownership transfers, funds are exchanged, and you receive the keys to your new property.
Settlement timeline
Weeks 1-2: Contract exchange
Immediately after offer accepted
Key Actions:
Weeks 2-4: Due diligence
2-4 weeks before settlement
Key Actions:
Weeks 4-6: Pre-settlement
1-2 weeks before settlement
Key Actions:
Settlement day
Final day
Key Actions:
Post-settlement
After settlement
Key Actions:
Essential legal checklist
Before signing contract
criticalDue diligence period
criticalFinance & insurance
criticalPre-settlement
importantPost-settlement
recommendedCommon legal pitfalls to avoid
Not reading the contract thoroughly
highMany buyers sign contracts without understanding all terms, especially special conditions that may be unfavorable.
✓ How to Prevent:
Always have a solicitor review the contract before signing. Ask questions about anything unclear.
Skipping building and pest inspections
highBuyers skip inspections to save money, only to discover major structural issues or pest problems after settlement.
✓ How to Prevent:
Always conduct professional inspections before settlement, even for new properties.
Missing finance approval deadlines
highFailing to obtain finance approval within the contract timeframe can result in losing your deposit.
✓ How to Prevent:
Apply for finance immediately after contract signing and stay in close contact with your lender.
Forgetting about additional costs
mediumBuyers budget for deposit and mortgage but forget stamp duty, legal fees, inspections, and insurance.
✓ How to Prevent:
Create a comprehensive budget including all upfront costs: stamp duty, legal fees, inspections, insurance, and moving costs.
Not checking title and boundaries
mediumDiscovering boundary disputes, easements, or title issues after purchase can be costly and stressful.
✓ How to Prevent:
Have your solicitor conduct thorough title searches and verify property boundaries match the contract.
Waiving cooling-off period
mediumBuyers at auction or under pressure waive cooling-off rights, then discover issues they cannot escape from.
✓ How to Prevent:
Only waive cooling-off period if you have completed all due diligence and are absolutely certain.
No insurance before settlement
highProperty damaged between contract and settlement without insurance can leave buyer liable for repairs.
✓ How to Prevent:
Arrange building insurance to start from the date of contract exchange, not just settlement.
Skipping final inspection
mediumBuyers skip the pre-settlement inspection and discover items removed or damage that occurred after initial viewing.
✓ How to Prevent:
Always conduct a final inspection 1-2 days before settlement to ensure property condition matches contract.
Not understanding strata rules
mediumApartment buyers discover restrictive by-laws or high levies after purchase that affect their lifestyle.
✓ How to Prevent:
Thoroughly review strata reports, by-laws, and meeting minutes before committing to an apartment or townhouse.
Poor communication with solicitor
lowBuyers miss important deadlines or requirements due to not responding to solicitor requests promptly.
✓ How to Prevent:
Respond quickly to all solicitor communications and keep track of all important dates and deadlines.
Insurance requirements
Building insurance
Covers the physical structure of your property against damage from fire, storms, theft, and other events.
Contents insurance
Covers your personal belongings inside the property, including furniture, electronics, and valuables.
Landlord insurance
For investment properties, covers loss of rent, tenant damage, and legal expenses related to tenancy.
Lenders mortgage insurance (LMI)
Protects the lender if you default on your loan. Required when borrowing more than 80% of property value.
Cooling-off period
A cooling-off period gives buyers time to reconsider their purchase, conduct inspections, and withdraw from the contract if needed. Rules vary significantly by state.
New South Wales
- Does not apply to auctions
- Can be waived with Section 66W certificate
Victoria
- No cooling-off for auctions
- No cooling-off for same-day sales after auction
Queensland
- No cooling-off for auctions
- No cooling-off for follow-up auction sales
South Australia
- Applies after receiving Form 1 vendor statement or signing contract
Western Australia
- Cooling-off can only apply if inserted as special condition in contract
Tasmania
- Optional if included in contract form
- Otherwise not applicable
Australian Capital Territory
- Does not apply to auctions
- May be waived via solicitor's certificate
Northern Territory
- Does not apply to auctions
- Begins from last signature on contract
Questions about the legal process?
Understanding the legal requirements is crucial. Get answers to your questions about contracts, cooling-off periods, and settlement procedures.
Post-settlement & homeownership
Understand the ongoing costs, maintenance requirements, and financial strategies for long-term homeownership.
Moving in checklist
Before moving in
1-2 weeks before settlement
Settlement day
Day of settlement
First week
Within 7 days of moving in
First month
Within 30 days
Ongoing ownership costs
Important: Budget for these ongoing costs in addition to your mortgage repayments. Costs marked as "Tax Deductible" apply to investment properties only.
Council rates
Annual rates charged by local council for services like rubbish collection, parks, and infrastructure.
Water rates
Fixed service charge plus usage charges for water supply and sewerage.
Strata levies (if applicable)
Regular fees for apartments/townhouses covering common area maintenance, insurance, and sinking fund.
Home insurance
Building and contents insurance to protect against damage, theft, and liability.
Home loan repayments
Principal and interest payments on your mortgage. May include offset account or redraw facility.
Utilities
Electricity, gas, water usage, internet, and phone services.
Repairs & maintenance
Ongoing repairs, servicing of appliances, garden maintenance, and general upkeep.
Land tax (if applicable)
State tax on property value above threshold. Varies by state; not applicable to primary residence in most states.
Regular maintenance schedule
Regular maintenance prevents costly repairs and preserves your property value. Budget 1-2% of your property value annually for maintenance and repairs.
Clean gutters and downpipes
essentialService air conditioning
importantTest smoke alarms
essentialInspect and service hot water system
importantPest inspection and treatment
importantCheck and repair roof
essentialService pool (if applicable)
essentialGarden maintenance
optionalPaint interior/exterior
importantDeep clean carpets
optionalSeal driveways and paths
optionalService garage door
optionalTax considerations
Investment property deductions
If your property is an investment, you can claim deductions for loan interest, rates, insurance, maintenance, and depreciation.
Capital gains tax (CGT) exemption
Your main residence is generally exempt from CGT when you sell it, potentially saving tens of thousands in tax.
Home office deductions
If you work from home, you may be able to claim deductions for a portion of running costs, internet, and phone.
Land tax
Most states charge land tax on investment properties or if total land value exceeds threshold. Primary residence usually exempt.
Building equity faster
Equity is the difference between your property value and what you owe on your mortgage. Here are strategies to build it faster:
Make extra repayments
high impactPay more than the minimum on your home loan to reduce principal faster and save on interest. Even $50-100 extra per month makes a difference.
Increase payment frequency
medium impactSwitch from monthly to fortnightly or weekly repayments. This results in one extra monthly payment per year and reduces interest.
Use offset account
medium impactKeep savings in an offset account linked to your loan. Interest is calculated on net balance, reducing interest charges.
Strategic renovations
high impactFocus on high-ROI improvements: kitchen, bathroom, outdoor living areas. Research local market preferences before renovating.
Maintain property condition
medium impactRegular maintenance prevents small issues becoming expensive problems and preserves property value.
Refinance when beneficial
high impactReview your loan every 1-2 years. If rates have dropped or your equity has increased, refinancing could save thousands.
Avoid redrawing equity
medium impactResist the temptation to redraw equity for non-essential purchases. Keep building your ownership stake.
Improve energy efficiency
low impactInvest in solar panels, insulation, efficient appliances. Reduces bills and increases property appeal to buyers.
Build a home emergency fund
Set aside funds specifically for unexpected home repairs and maintenance. This prevents having to redraw from your mortgage or use high-interest credit.
What it covers:
Optimize your home loan
Whether you're planning to buy or already own, check if you're overpaying, track better deals, or get personalized insights.