No matter how many people caution you to take the emotion out of the process, if you’re going to buy your first home, you’re going to have emotions. Lots of them. It’s naive to expect us to disconnect from a decision so personal.
But you can keep your emotions under control, and you have to if you want to make sure you’re not taken advantage of and so you’re able to spot issues and risks before you buy.
Try leaning on a friend or third party to help you stay objective and sound out your thought processes. And if you fall in love with a house on first sight (it happens), don’t ignore that little voice in your head reminding you to do your due diligence if you want to spend the rest of your life with it.
Read the fine print, even if you’re dazzled by the packaging.
Remember: this is a huge purchase. Read all the fine print, even if you’re dazzled by the packaging.
2. Stretching the budget too far
When you’re doing the numbers on buying your first home, build in some buffer but have a clear idea of your actual, immovable limits. When you’re staring down other buyers at an auction and the adrenalin is pumping, it’s far too easy for even the most rational of us to shoot up the hand for an extra $5,000 we simply don’t have.
Exercise financial discipline and don’t over-extend yourself. The perfect home won’t be consolation if you can’t afford to furnish it – or, worse still, can’t cover your mortgage payments and living costs because you got carried away.
3. Not budgeting for hidden costs
The price tag on the property is just the beginning. Before you’ve bought you’ll need to factor in the cost of building and pest inspections. Then there’s stamp duty and legal fees to cover conveyancing and title searches.
There may be fees imposed by your mortgage broker, such as application, valuation and settlement fees.
And then you’ll need to consider moving costs, insurance, council rates and the cost of ongoing maintenance – many things you didn’t have to worry about when you were renting.
There may be fees imposed by your mortgage broker, such as application, valuation and settlement fees.
Make sure you’re aware of the costs you’ll be facing and budget for them so there are no nasty surprises and you have plenty of income to enjoy your new lifestyle.
4. Not getting your finance sorted
If you’re ready to buy you’ll need to get pre-approved finances from a lender. That way you’re ready to pounce when you find your dream property. Failing to have your paperwork in order can mean you might miss out when you can least afford it.
Failing to have your paperwork in order can mean you might miss out.
You’ll need documentation of your loan and be ready to pay the deposit immediately.
While some vendors and agents do accept offers on their property subject to financing, an unconditional offer will always be preferable.
5. Getting impatient
If you’ve been house hunting a while (and for most people it takes a while), you can get search fatigue. You’re tired of getting everything ready, and getting pipped at the post at the last minute by somebody who came in with a higher offer.
If you’re exhausted and frustrated, it becomes very tempting to buy the next property that comes along, whether it ticks all your boxes or not. It might not have to tick all of them, but it still should tick the most important ones, or you’ll be unhappy in the home and want to move on.
Remind yourself what your top priorities in a home are – take a break from house hunting if you need to – then start again with renewed vigour. Plenty of buyers have jumped in because they were impatient and suffered from remorse when the right property came along a month later.
6. Getting a building inspection
It’s one of those things than can not only save you money, but possibly save your life. Faulty wiring, shaky foundations, pest infestations … there are a range of things that might be wrong with a property that you won’t catch with the naked eye.
Always get a trained professional to give a property you’re considering buying the once-over. For only a few hundred dollars they can catch the stuff you won’t see – but that might cost you a fortune in renovations or repair if you charge ahead unaware.
7. Going it alone
A good real estate agent. A lawyer, building inspector, mortgage broker. A trusted open-for-inspection buddy. Even if you’re buying on your own, you shouldn’t face the process alone. There are specialists whose job it is to cover those areas you didn’t even know you didn’t know.
Surround yourself with a good team of people you trust and everything about the process will become easier.
Surround yourself with a good team of people you trust and everything about the process will become easier. Best of all, you’ll have that network for your next property move – whether it’s buying an investment property, renting out of selling the home you’ve just purchased, or just undertaking renovations.
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