Buying a home will probably be the biggest financial decision you’ll ever make, so the idea can be pretty daunting for first-timers. It’s important to know what to look for and how to tackle this big purchase.
To help you get started, we’ve put together a list of 10 important tips to buying your first home.
1. Know Your Limits
Before you start looking, you need a solid idea of how much you can afford. Take an honest look at how you spend and know how much of your pay will go toward bills, day-to-day expenses, repaying any existing debts, and how much you will have left to pay for a new home loan.
Make sure you don’t set yourself up for failure by making your budget too tight. Factor in that you’ve got your first homeowner’s grant available to help you out.
2. Start Saving Now
Remember that there are more costs involved when saving to buy your first home than a deposit. You have to also consider any furnishing costs, any touch-ups or renovations like new carpets or paint, set-up costs for services like phone and internet, and any unforseen expenses if anything goes wrong with the house, like an emergency trip from a plumber, for example.
Do yourself up a budget, factor in all these possible costs, and stick to it. Set yourself goals and make sure your budget suits your lifestyle, or it will be very difficult to follow.
3. Investigate Debt Consolidation
If you’ve already got some personal debt that you’re paying off, consider debt consolidation. Debt consolidation means combining all your personal debts into one loan repayment, usually at a lower interest rate. You may be able to combine your personal debts with your new home loan, which will save you money and is much easier to manage.
A reputable financial services company like Fox Symes will be able to walk you through the process. To learn more visit foxsymes.com.au.
4. Finance Pre-Approval
Get your finance pre-approved before you start hunting for the perfect property. This will mean you avoid missing out on your dream home while you are still waiting on the bank to come through with your loan.
5. Look Past Your First Impressions
When looking at a potential new home, remember: looks can be deceiving. It’s important to consider what a messy or weathered looking property would look like with a new coat of paint or a few new fixtures. You could wind up grabbing a bargain.
6. Find a Real-Estate Agent
Do some research and find a real estate agent whom you can trust to represent you throughout the hunting and buying process. An agent will be in the know about the current market, houses up for sale, who to do business with, and all the laws and processes you’ll need to follow.
7. Know What You’re Looking For
Make a list of all the qualities you want in a property, from suburb to size. Also consider things you want to avoid and come to any inspections prepared with all your requirements.
8. Get the Home Inspected
Once you’ve set your sights on a property, make sure the home has been inspected for any defects or infestations. You can have a pest and building report done before buying to ensure that the property has no major structural issues, electrical faults, pest problems etc.
9. Read and Understand Your Contracts
The documents you sign when finalising the purchase of your house can be hard to swallow in one rushed sitting. Ask for draft documents prior the closing date of the sale so you have some time to read your contracts and, if you need to, discuss them with your agent, mortgage broker or lawyer.
10. Avoid a Bidding War
Remember that there are plenty more fish in the sea. If you’ve got your heart set on a property, you risk being blinded into paying too much and blowing your budget. Remember your limits and know when to walk away.
Do your research and make sure you know what you want and what you’re getting yourself into. If you’re prepared with knowledge, you’ll see the whole thing is a breeze. All that’s left is moving in!
Tara is a personal finance writer from Brisbane, Australia, who is currently going through the process of buying her first home. She provides these tips to fellow new home buyers and says that if you are having debt problems, consolidation loans from Fox Symes should be explored.