Advice to first home buyers wanting to buy property

Any seasoned home buyer will tell you that having your finances in order is only the beginning. Knowing your budget can make the difference between success and failure when you’re making offers on properties.

For this reason, checking your borrowing capacity is an important first steps when buying a home. Once you know what you can comfortably afford to buy, you’re ready to start looking for a house.

Do your homework

Seasoned home buyers have the advantage of experience. As a first-time home buyer, you will need to do your homework to catch up with their knowledge. Before you start actively looking for a home, do the following.

• Visit suburbs you might want to buy in. Check if your future needs will be satisfied, things to consider; are schools, hospitals and amenities within easy reach? Are there signs of growth in the suburb?

• Do some research on what recent sale prices were for the suburb, don’t rely on the asking price.

• ·Turn up to auctions, attending a few will help you get a feel for the market and build your confidence for when you are ready to buy.

Make a list of areas you would like to explore in order of preference. Then start looking at houses. You will probably find one or two you’re interested in very quickly, but don’t stop there.

You’re most probably competing with other buyers earmarking the same property, pick at least 5 properties, if not more that you’d be happy to own as your first home.

Don’t get emotional

One the biggest mistake first-time buyers make is letting their emotions get the best of them. It may seem difficult, especially since it’s your first home but buying a house should be a business decision first. Compare asking prices with:

• the suburb

• the condition of the house

• the size of the block.

You want to choose a suburb you will feel comfortable living in, but the condition of the house you buy may not be as important as the size of the block on which it sits. There is nothing wrong with buying an older home to get a foothold and upgrading later on.

A smaller or older house on a large block may be better value than a newer or bigger house on a small block that stretches your budget to the limit.

Get expert advice

Consider reaching out to real estate agents who are active in the area you want to buy in, and without disclosing the top end of your budget, tell them what you’re a looking for and ask if they know of any similar stock listing that’s about to hit the market.

Finally, when you find a property and your offer is accepted, get a pre-purchase inspection report. It can be a valuable negotiating tool when buying an older property and, if the inspector uncovers a major problem, might save you from making a very costly mistake.

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This article does not constitute advice; readers should seek independent and personalised counsel from a trusted adviser that specialises in property, a tax accountant and property design specialist.