You probably heard ANZ has an excellent home loan product called Blueprint to Build. It's designed to encourage people to buy or build new properties. Their interest rate has a significant discount - you could get a 2.76% p.a. discount off the standard ANZ Home Loan floating rate for two years when building or buying a newly built home. In contrast, if you don't use this product, your floating rate is probably close to six per cent, instead of sub-three per cent. This product looks more attractive than ever in the current interest rate-raising environment. It's an excellent opportunity to grab if you are eligible.Recently, one of our clients bought a new property from someone as the previous buyer couldn't settle due to the finance issue. They got a good purchase price but were surprised they couldn't get the ANZ Blueprint to Build interest rate. So obviously, they're very disappointed. The reason is that to qualify for these products, it's not only you have to purchase a brand new property, but you also have to purchase it from a developer directly, rather than from someone else.

Now coming back to the vendor's situation, it's not uncommon to see people transfer the purchase to someone else before settlement. This is because over the last couple of years, with the COVID lockdown and the construction material shortage, the construction period has taken much longer than expected. As a result, many people who used to have pre-approval have their offer expired. On the other hand, over the last six months, banks have made considerable changes to their lending policies and appetite. Most people borrowing capacity have reduced significantly. As a result, most of them no longer qualify for the same approval even if their financial situation is unchanged. One of the solutions people choose in that situation is to sell the property before settlement to avoid losing their deposit which is a significant amount of money for most people.

It's a bargain for people who can purchase the property at a price set two years ago. In addition, with this kind of opportunity, you can qualify for other unique benefits, such as the Home Grant if you are a first home buyer. For property investors, if you buy a new property, you can still claim interest costs as expenses against rental income when it comes to tax calculation. These policies are driven by the CCC issue date rather than the purchase source.

In summary, it can be an excellent opportunity to purchase a new property from a previous buyer if they couldn't settle for some reason. However, remember that you wouldn't qualify for the ANZ Blueprint to Build interest rate if you do that. When calculating your cash flow or rental yield, you need to consider this.

 Disclaimer: The content in this article are provided for general situation purpose only. To the extent that any such information, opinions, views and recommendations constitute advice, they do not take into account any person’s particular financial situation or goals and, accordingly, do not constitute personalised financial advice. We therefore recommend that you seek advice from your adviser before taking any action.