Like speaking your first words, graduating university or even retirement, buying your first home is a defining moment of your life and the start of a new and exciting adventure.
Make sure your first steps into the great unknown are in the right direction by avoiding the following costly mistakes.
1. OVEREXTENDING YOUR FINANCES
Regardless of how much house prices are increasing, it’s essential that you don’t overextend your finances. While it may be tempting to splash out that extra 50k, you must first consider if you’ll be able to easily afford your weekly mortgage repayments. Buying at the edge of your means leaves you far more vulnerable to unexpected costs and changes in the market.
2. SKIPPING THE INSPECTIONS
Building inspections and pest inspections are an essential part of this process.
A building inspection will give you an expert’s view on the property, alerting you to any issues before you buy. A pest inspection report, on the other hand, will let you know if the property has any costly pest problems to resolve. They’re indispensable tools for any property buyer.
These reports could cost around $300 to $1,000 a pop, but if they alert you to issues with the property they could save you 100 times that.
When buying a property you should never be naive or adopt a ‘she’ll be right’ attitude. The magnitude of this decision necessitates that you don’t take any risks at all, and cover all your bases when it comes time to make a decision.
3. NOT SHOPPING AROUND
By choosing the first property you like you could miss out on the next one that you absolutely love.
Finding the first property that fits your needs is an incredibly exciting moment. You might imagine yourself walking through the halls, sleeping in the bedroom, or watching TV in the lounge. But it’s important that you don’t let your emotions take over and make a decision before considering all your options.
4. GOING IT ALONE
A First Home Buyers Australia survey found that the most helpful services available are mortgage brokers and real estate agents.
Young Australians are a self-sufficient bunch and usually are fiercely independent. When it comes to buying a home, however, it’s important to put this aside and get the help that you need.
You wouldn’t go it alone when it comes to your health or your education, so why should you when it comes to your finances and the roof over your head?
5. FORGETTING ABOUT GRANTS
Free money sounds too good to be true. State first homeowners grants are one rare occasion where it’s not. However, for inexplicable reasons, first home buyers often buy without the help of home buyer grants, instead of relying on their own savings. Don’t make that mistake.
In NSW, there are two schemes to help first home buyers get into the property market: The First Home Owner Grant (New Homes) Scheme, and the First Home Buyers Assistance Scheme. The first scheme is a cash grant and the second is a tax concession or discount. Some buyers may be eligible for both.
In conclusion, if you manage to avoid the above mistakes and seek the right help, there’s absolutely no reason why your first home can’t be the step towards something great.