Home ownership 101: How soon is soon enough to insure your new home?
While the warm weathers appears to be on the way out, the Aussie property market is showing no sign of cooling down.
According to the Australian Bureau of Statistics (ABS), the value of housing finance has increased to a massive $33.5 billion in February this year.
Owner-occupier lending alone jumped by 1.3% to $21.5 million and was recorded as the largest percentage increase in four months.
Senior Economist at ANZ Bank, Daniel Gradwell said, “First home buyer lending is up more than 40% over the past year, and accounted for 12.4% of all housing finance in February. That is the highest share of borrowing in nearly five years.”
But as the number of Aussies picking up a home loan continues to climb, many first homebuyers may be underestimating the importance of adding a home insurance policy to their to-do list before moving in.
“Having home insurance is good for your peace of mind when you move into a new home, but what not many buyers know is that having home insurance could actually be a requirement in their mortgage contract,” said Mozo Property Expert, Steve Jovcevski.
“It’s a good idea to have at least building insurance when you exchange contracts because this is when you’ll become legally obliged to buy the property.”
Jovcevski also recommended that Aussie buyers organise this in advance by requesting a cover note from your insurer to cover the period between exchange and settlement.
“If insurance is a requirement in your contract, you’ll also need to send a copy of the cover note to your lender so they can release the funds for settlement.”
When it came to finding the perfect policy, Jovcevski encouraged Aussies to do right by their new home and compare home insurance policies to find the perfect fit.
“You don’t have to take the insurance policy offered by your lender - shop around and get a minimum of three competitive quotes,” says Jovcevski.
And since we’re all about helping Aussies save some bucks wherever they can, we’ve jotted down some easy things you can do to save on your home insurance policy:
- Head online - It’s been said that online providers can help you save on your banking products and your home insurance is no exception.
- Bundle your policies - Also in need of a car insurance policy? If you buy multiple policies under the one provider, you may be able to snag a discount.
- Upgrade your home security - Insurers may also reward your effort to secure your house with a discount if you upgrade your securities systems.
- Regularly review your policy - While your policy might be the best deal at the time, this may not be the case in a year’s time. So be sure to regularly compare your policy against other offers to ensure you’re still on the best deal around.
Ready to compare home insurance policies? Check out our home insurance comparison tool.