Buying your first home is surely exciting, but can be overwhelming as there are many things to consider. If unprepared, a first home buyer will inevitably make mistakes resulting in additional costs and long term issues.
Here are 5 common first home buyer mistakes and our tips on how you can avoid them.
Not researching the location
Perhaps the biggest real estate rule is to research the location of the property. You can fix or update a lot of things about a house, but you can’t change its location, so make sure to research the area and the neighbourhood. How busy is the street? Is it noisy? What are the neighboring properties like? Checking out the property at different times during the day will allow you to get a sense of what it would be like to live in that neighbourhood.
Not understanding all of the costs
Buying a new house isn’t just about paying the purchase price. There are other costs you need to take into account. There will be stamp duty payable on the property, mortgage application fees, transfer fees, solicitor fees, registration fees and so on. There will be additional costs once you move in as well, such as for maintenance and repairs. It is important that you have a clear understanding of the additional costs you’ll be responsible for.
Not knowing what you want
As a first home buyer, you may not be quite sure what you are looking for, so before you start browsing for options, you need to ask yourself a few questions: What exactly am I looking for? Do I want to live in a house or an apartment? What area do I want to move into? What things will I have a problem with? Will it be worth all the money I will be spending? Consider engaging a real estate agent to help you think it through and guide you through the process.
Not knowing your financial capacity
You may have good credit, but if you cannot service your loan, it could put you at risk of losing your home. You need to assess your income and all other expenses before committing to a loan. Be realistic about repayments and determine what you can actually afford.
Not getting pre-purchase inspections done
It is critical that a building and pest inspection is carried out before you purchase. These checks, carried out by a qualified person, will ensure that you’re buying a sound home, and not one that requires extensive work or repairs down the track.
As a first home buyer, you need to think carefully about buying a property, do sufficient research and do not rush into it so you can make an informed decision and avoid these common mistakes.