First time home buyers...
it is understandable for you to feel anxious, but solid preparation and knowledge of the process will help you buy the house of your dreams.
As obvious as it may seem, the crucial first stage on the road to home ownership is being aware of exactly what you can afford to buy. Your lender will offer pre-purchase approval so that you know where you stand financially from the beginning.
Once you have identified a property you would like to buy, the lender will then be able to formally approve a loan much more quickly thanks to your proactive approach - our finance team can help you with this step.
While it might be tempting to avoid sundry costs as much as possible - given that you are about to invest a significant amount of money into buying your first home - it is unwise to ignore the value of pest and building inspections.
You would be well advised to stress the high level of urgency of these inspections to whoever you contract to do the job - and the same applies to your solicitor or your conveyancer.
Depending on the state your new property is located in, you may come across a contract that includes a "subject to…" section, with factors such as finance approval and satisfactory pest inspection often listed as prerequisites to a sale.
The property cannot be sold to another party for the period of time stipulated in the contract.
An alternative approach to consider is buying at auction. This is a scenario that may seem intimidating to many first time property buyers, but if you do your research it can be a viable strategy.
Many of the steps that go into purchasing a property privately also apply to auctions, such as arranging the required inspections and seeking formal approval of your loan.
Although it is possible for properties listed for auction to be sold in advance, in the majority of cases they will go under the hammer on a specified date.
If you are the successful bidder at the auction, you and the vendor will enter into an unconditional contract - at this point you will take legal ownership of the property.
First time buyers...additional costs to consider.
First time home buyers should be aware that there are often additional costs associated with purchasing a property.
The most significant single fee you are likely to face is state government stamp duty, if it is applicable in your location.
Pest and building inspections are not obligatory, but they are highly recommended for avoiding the possibility of buying a home with existing problems that could be very expensive to rectify later.
Your solicitor or conveyancer may advise that you obtain a new survey of the property, while there are also a number or searches and enquiries they will need to charge you for.
There are generally certain legal and loan establishment costs that your lending body will pass onto you, so it is advisable to ask about such fees in advance.
Although it is not strictly a factor in the purchase of the property, the cost of moving home should also be calculated into your financial planning.
The real estate agent's costs are incurred by the vendor, so this is one aspect of the sale you will not need to worry about.
Consult the expert advice of a solicitor, conveyancer or LJ Hooker real estate agent for more comprehensive details regarding your personal situation.
Looking for more Property Buying Tips?
- myMarket Report - Your National and Regional Property Report
- Your Complete First Home Buyers Guide
- Open House Inspection Checklist
- Open Apartment Inspection Checlist
- Your Home Your Mortgage
- Home Loan Glossary
- Your Complete Moving Guide
- Understanding the Buying Process
- Different Ways to Buy a Property
- Buying a Property - The Hidden Extras
- How to Work Out the Budget You Can Afford
- Where to Research the Find the Best Property