Ready to take the plunge and buy a new home? If you’re like most people, it will probably be the largest purchase you’ll ever make – and this is an exciting, but daunting prospect.
Get it right and you’ll set yourself up financially – but get it wrong, and it could spell disaster. Many home buyers are unprepared, which leads to poor buying decisions, but if you avoid these common mistakes, you’ll give yourself the best chance of coming out on top.
Decide on possible locations, and get to know the neighbourhood. Find out about transport, schools and crime levels, and keep in mind that not all parts of your preferred suburb will be an ideal place to live.
Also, be clear on what you need in a house. Knowing how many bedrooms and bathrooms is obviously important, but go even further.
Do you need a bath or just a shower? Is ample bench space in your kitchen and open plan living important to you? And are you handy (or willing to spend extra) to fix up a home that needs renovations?
In which case, is buying or building a better option for you? Thinking clearly about this in advance will save you time, and narrow down your options.
Don’t assume that you can borrow the amount the bank’s online calculator says you can – often there’s a big difference in the amount that the banks will actually lend you.
Also, be choosy with your mortgage; don’t just talk to one bank. Visit a finance broker who can compare multiple lenders and finance products, and will help you get the best deal.
If you have your finances sorted and are ready to buy don’t let short term market fluctuations affect your plans.
But a word of warning - don’t spend more than you can afford. Going over budget will expose you to unnecessary financial pressure. Leave yourself room to move to cover interest rate rises and changes to your future circumstances.
Of course you want to get a good price, but make sure the house ticks all the other boxes too. And don’t let yourself fall in love with a property and end up spending more than you can afford.
Be smart, and trust that there are plenty of houses out there, and you’ll find the right one at the right price. Finally, if you’ve been house hunting for months, don’t fall in to the trap of buying out of frustration.
Be patient, and take a break from looking if you find yourself tempted to buy the next house that comes along because you’re sick of looking.
Don’t forget to include in your budget the extra costs involved in buying a home, on top of the purchase price. Acquisition costs include stamp duty, rates, valuation costs, loan application fees and mortgage insurance.
Keep some money in your budget for unexpected costs that may pop up when you move in, for example if something breaks. You’ll also need to leave room in your budget for the ongoing expenses that come with owning your own home – things like rates, insurance and maintenance.
Don’t be surprised if the report includes a long list of faults – and don’t be put off by minor faults that are easily fixed. Worry about the major ones, as these are what will cost you in the long run.
Buying a home is a huge decision – so don’t take it lightly. Prepare yourself, do your research and understand exactly what you need and want in a home before you start.
Also, make sure you examine all the available options. Will you buy an existing home, and if so, are you willing to spend more when you move in to renovate if needed? Or are you keen to build a brand new home?
If you decide to build, be sure to consider both a conventional build and a modular home.
And remember: all the thought and groundwork you put into the buying process, will be well worth it when you and your family are settled in and enjoying your perfect new home.