The Mortgage Supply Company

Choosing a home


Choosing a home

Quarter-acre dream or inner-city apartment – or anywhere in-between? There are plenty of different things to consider when choosing a home, from type of ownership to location.

Types of ownership


House and land, you own the whole thing.


You own the house or apartment, but you don’t own the land – instead you pay yearly to lease it.

There are different types of leaseholds, but a commercial leasehold is the one you should be most cautious about. Many apartments are operated on commercial leaseholds, and advertise a very low leasehold rate for the first year – then the next review comes and the price goes up by 100%. The important things to find out are how long it is till the next leasehold review and how much the increase is likely to be.
Banks will often loan less money towards a leasehold property than freehold.


This was a popular way of subdividing property a few decades ago. Essentially you own a share of a freehold title. There may be conditions on the title as to what you can do with your house, and your neighbours might have to approve any renovations – so it’s worth getting a lawyer to review the title.

Strata or unit title

This type of ownership is common for townhouses and apartments. You have ownership of your unit and an undivided share of any common areas. You will have to pay body corporate fees to fund the upkeep of those common areas, plus things like building insurance.

House versus apartment?

If you’re struggling to afford your first home, and don’t want to be priced into the outer suburbs of wherever you want to live, the idea of an apartment can be tempting. They’re generally cheaper and more central – but be careful. Lenders can be wary about lending money to buy an apartment, as they’re not always a great investment – since they don’t come with land there’s not much to appreciate in price. You may find yourself having to pay a larger deposit than with a house. Then there is the concern about whether the apartment is leasehold or freehold – and freehold apartments are much more expensive.

In the end it might come down to lifestyle – are you going to be happy in a three or four room apartment for the long-term?


It’s the real estate agent’s creed – location, location, location. In the rush to find the perfect home, the suburb can be overlooked, but choosing the right area is a key stage in the home buying process.

Think about lifestyle and community

The first step is to think about what your needs are. Is it important for you to be living near family and friends? What aspects of your lifestyle do you want to prioritise – not only for now but also in the future? This could include things like good schools if you are planning on having children, or if retirement is on the cards you might want shops and libraries nearby. Do you want to be close to nature, or is the proximity to nightlife more important?

Explore the area

Visit the suburbs that interest you and have a look around. Do you like the style of housing in the area? Are the homes well-maintained and the streets tidy? Observe the neighbourhood at different times of day. This will give you an idea of how much traffic the roads carry, how easy it is to get around on foot, and how well-lit the streets are after dark. These are all important clues to “liveability”.

Also consider noise from airports, motorways, and traffic. Check with the council whether any major developments are planned for the area.

Research the amenities

Check out the local shops and eateries, and visit parks and recreation facilities. Consider retail outlets, supermarkets, churches, doctors, and playgrounds. Are there any community centres or libraries close by? What is public transport like?

Take a test drive

Check the commute from the area to your work, whether by car or public transport. Make sure to factor in time and not just distance – traffic may be horrendous at the time you usually make your commute. You’ll have to deal with it every day, so this is one place to really do your homework.

Talk to the locals

If you know anyone living in the area, have a chat with them. Ask about the positives and the drawbacks and ask them to be completely honest with you.

Think laterally

Some suburbs are more expensive to live in than others. If your suburb of choice is out of your budget, a neighbouring suburb might be more affordable and still close to the schools and amenities you’re looking for. Sometimes these neighbouring areas can become the next desirable suburb and you’ll reap the benefits of your home increasing in value.

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