First-Time Home Buyer Considerations
While in the past the situation may have looked grim, when it comes to the issue of home-ownership in Australia, at the moment, the situation seems to be rapidly improving. This has an even more optimistic note, seeing as how the number of first-time home buyers is also on a stellar rise. This also affects other industries like owner-occupied loans and local real estate trends.
Reasons behind this are numerous but the increased stability and the uninterrupted rise of Australian GDP may be the primary culprits. When the financial field is stable, people feel encouraged to take risks with these massive investments. The biggest problem lies in the fact that first-time buyers may not have enough experience to make all the right calls and, at the end of the day, make the right decision. With that in mind, here are several things that first-time home buyers must consider to avoid some of the costliest mistakes.
Meet with a mortgage lender right away
The first thing you need to understand is the fact that you need to have a reliable source of money for this purchase in order to even start negotiating for the home in question. One of the biggest mistakes that buyers make is to use too much of their personal budget (money they take from their 401K, emergency fund or life insurance) in order to bridge the gap between the money they have and the money they need for the house in question. It’s much better to already have approved funds that you can work with so that you can close the deal for the place as soon as possible.
Can you really afford the place?
This sounds a tad silly, seeing as how you might already have a budget but, you need to keep in mind that you need to understand what buying a bigger place does to your monthly mortgage payment. Sure, you can qualify for the loan in question, but can you really afford the expenses that come with it? Getting a bigger place means paying more for it, which also means paying a bigger monthly mortgage, in addition to paying more for utilities, upkeep and maintenance. All of this put together may exceed what you’re able to spare each month. Take this into consideration before buying.
Do you really have an in-depth knowledge of the market?
You would be surprised at just how easy it is to overestimate yourself when it comes to your own ability to get the home you need. Sure, you can recognize features you like and those you don’t like, as well as do the basic research of the neighborhood. After all, all you have to do is look at other properties, nearby parks, schools, local crime rate, etc., right? Well, not really.
Things are always more complex, and you can’t afford to focus on the current state of affairs when trends are inevitably changing. This is especially true if you want to look for a specific type of property. For instance, finding a professional to help you choose between luxury display homes in Sydney is definitely a move that can help you avoid making a costly mistake.
Don’t rush it!
Perhaps the most important piece of advice that you’ll ever receive on this topic is to take your time. You see, if you aim to buy a place of your own, you’re facing a decision that will affect the rest of your life and even have some short-term effects on your overall lifestyle. Why wouldn’t you take a year or two in order to improve your credit rating, track movements on the market and take into consideration all those goals you want to achieve through this purchase? This is a big move that shouldn’t be made overnight.
House and the neighborhood are equally as important
One last thing you need to understand is the fact that the house and the neighborhood are both equally important for the overall lifestyle. For instance, what good is it to get the bedroom of your dreams if your house is located near the local airport. One way or another, you won’t be able to get an hour of quality sleep night or day. Moreover, saving money by buying a home in a bad neighborhood is not really a frugal move, seeing as how you’ll have to overinvest in the form of security upgrades.
By making these five considerations alone, you’ll put yourself in a scenario where you’ll feel a lot more comfortable about buying the property in question. This is incredibly important seeing as how doubt and regret are the last two things you need when it comes to such an important decision.