First homebuyers: the basics you need to know

If you’ve decided to purchase your first home or investment property this year, you want to avoid making any mistakes that could end up costing you down the track.

The following tips will help make sure you’re ready and comfortable with your choice, before you dive into the property market for the first time.

Do the numbers
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, with all the features they want. You’ll need to either be open to surrounding areas to be able to get the amount of accommodation you desire, or sacrifice on size to get a better location. Once you know your budget, start looking for properties in your shortlisted areas 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 amenities. Homes that are close to things such as 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. Check to see what zoning changes and additional infrastructure will be added in the next few years by contacting the local council and accessing suburb planning documentation.

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 local prices 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.

Article supplied by Besser & Co.

Photo credit: MarkMoz12 via Visual Hunt / CC BY