It’s a new year and like every year, more and more new home owners will enter the market.
If you’ve decided to take advantage of the record low interest rates and purchase your first home or investment property this year, you want to avoid making any mistakes that could end up being very costly down the track.
So before you dive into the property market for the first time, the following tips will make sure you’re ready and comfortable with your choice:
- Know your budget. Before you start your Real Estate search, make sure you find out your borrowing capacity by obtaining a loan pre-approval from your bank or mortgage broker. Consider your repayments now and if interest rates were to rise. Try not to over-extend yourself financially – a mortgage broker will help you crunch the numbers and should advise you on what will be affordable based on your income, debt and lifestyle.
- Broaden your search. Most people won’t be able to buy their ideal first property in the exact location they’d like or having all the features they want. You’ll need to be open to surrounding area’s to be able to get the accommodation you like or sacrifice on size to get a better location. Once you know your budget, start looking for properties in your shortlisted area’s and see what you can afford.
- Location matters. You’ll most likely live in your property for a number of years, so you want to find a property that offers you some lifestyle benefits. Homes that are close to shopping centres, schools, hospitals and recreational facilities will offer you lots of benefits while you live there but also make your property appealing when you eventually decide to sell. By contacting the council, you’ll be able to access suburb planning documents to see what zoning changes and additional infrastructure will be added in the next few years.
- Knowledge is power. Do your research before purchasing your first property. By spending your weekends going to auctions, you can quickly familiarise yourself with property prices in the area. Ask the agents about prices in the area and things you should look out for. Property building inspections are also worth considering especially when purchasing an older style property. Things may look shiny and new from the outside but that fresh coat of paint could be hiding some nasty, expensive secrets.
- Stick to your budget. Buying your first home can be a very emotional time and it’s easy to get carried away during an auction or negotiation with an agent. Before you attend an auction, make sure you decide how much you’re prepared to pay for the property and stick to it.