Many of us dream about finding the perfect home; a place where you can live by your own design and create lasting memories. It’s one of the biggest financial commitments to make and it’s easy to let your heart rule your head during open inspections.
We want you to be prepared. Here are eight things to consider before buying.
1. FIND A SUITABLE LENDING INSTITUTION
You don’t have to use the financial institution you bank with, or who have financed you previously. Start with what they can offer, then shop around. If the process is too overwhelming, or you are time-poor, approach a mortgage broker. Their job is to find the best lender with rates and terms to suit you.
2. PINPOINT WHAT YOU CAN AFFORD
Obtain mortgage pre-approval from your chosen lender. You’ll know exactly what can be spent, allowing you to target suitable properties. No one’s time is wasted by having financial approval in place.
As a general rule, lenders recommend a total debt-to-income ratio of 36%, with mortgage costs not exceeding 28% of this amount. They will calculate your monthly income, minus any non-mortgage debts, and arrive at an estimate of what you can afford to repay. Changes in interest rates, the market and your projected income should also be considered.
3. CHOOSE AN AREA
Be realistic and practical. Consider where you can afford it and its proximity to what is essential to you; work, school, facilities, family.
Do your research. Check crime rates and talk to locals. Speak to the council about zoning and proposed developments. If multi-story apartment blocks and arterial roads are scheduled nearby, you may like to reconsider. Confirm building restrictions preventing extensions.
Recognise environmental hazards. If the area is a known flood or bushfire zone, living there could mean higher insurance premiums. Take this into account.
4. THINK LONG TERM
When a property catches your eye, think about the future. Will the home be large enough if you start a family? Or too big for you to maintain in your retirement? Are you planning on changing jobs, meaning a longer commute?
If you don’t want to be selling in a few years, keep looking.
5. THE BRICKS & MORTAR
It’s easy to be dazzled by superb property styling at an open inspection. Remember to look at the building itself. Cracks, sagging ceilings and dampness can turn your dream home into a costly nightmare.
The layout is important. Consider noise levels if bedrooms are close to living areas. Confirm compass points – west-facing rooms become hot. Will this suit their intended purpose? Look at whether the number of bedrooms fit future plans.
If you want to make an offer, have an independent building and pest inspection done first. It’s a small price to pay for peace of mind.
6. WHAT ARE THE ONGOING COSTS?
If you’re a first-time buyer, council rates, all utilities and home insurance will become an additional living expense. If you’re a seasoned buyer moving to a new area, these charges can differ from your previous location. Properties with larger gardens and pools cost more to maintain.
Ensure your budget can sufficiently cover any changes.
7. ARE RENOVATIONS REQUIRED?
Buying a fixer-upper has become a popular trend. It has its advantages; a property requiring extensive renovations can mean negotiating power, you can create a home to your own style and quality, and it’s a smart way to add equity, especially if you can do some of the work yourself.
For larger jobs, get independent advice before making an offer. Have a plan. Know what you want to do and who will be doing it. Factor urgent renovation costs into what you can afford to buy. Don’t get caught in the trap of a fun idea becoming an unfinished, financial nightmare.
8. VIEW THE PROPERTY AT DIFFERENT TIMES
A house can look and feel different at night compared to during the day. This could sway your opinion. If you’re a serious buyer, requesting several viewings is not unreasonable. It’s also an opportunity to show the property to a close family member or friend. Be open to second opinions. They may raise issues you hadn’t considered.
The quiet reserve across the road may be one of the reasons you love the property. See how it’s used on the weekends. Team sports can mean noise and parking issues. Maybe your dream street is used as a quicker alternative during peak hour. Driving by at different times will give you a bigger picture – more than from a single viewing.
It’s a big decision. Preparation and careful consideration will reward you with a home you love and a lifestyle that is perfect.
Thinking of buying? Check out all of our current properties for sale here & sign up for buyer alerts here.
