Buying Your First Home
For first home buyers, the idea of making such a big investment with the associated debt, can be frightening.
By ROB WALMSLEY
Your parents may be able to offer advice but in most cases, they haven’t a lot of experience either.
To ensure it’s as stress free as possible, put some thought into who you need to talk to and who they are working for. You will need to find a conveyancer unless you intend to represent yourself, and I would not suggest this unless you have some experience and lots of time. The conveyancer represents you and so has your interests in mind when dealing with the transaction. They will ensure that the contract is correct, carry out any necessary searches and hold your hand through to settlement.
A mortgage broker, likewise, will look after you. They will find the most suitable product and look after all of the paperwork for a swift approval. Most reputable brokers do not charge a fee as they are adequately compensated by the bank and are happy to meet to discuss your needs and obtain pre-approval without any costs.
A pest and building report is generally recommended unless the house is new. This is not a requirement of the bank, but certainly will give you peace of mind that the house isn’t getting eaten around you. Your conveyancer can usually assist with the name of a reliable person.
You will need to remember the agent you are buying from is working for the vendor, not you. While they will be your best friend during the sale process, unless it’s your brother/sister/best friend, don’t forget whose interests they have at heart – the vendor and their own. That’s not to say they are all disreputable, far from it, but just be aware and make sure of what you are told – see Research below.
Borrowing Power
Speak to your broker (me) and find out how much you can borrow. No point getting excited over an $800,000 property when you should be getting excited over a $400,000 home that suits your budget and borrowing power.
Don’t get in too deep. A lot of first home buyers go in with the idea that their first home is where they will live forever. This is seldom true as these days, most people change houses and employment frequently.
Another thing to consider is buying a ‘starter’ type house – something run down and in need of a make over. The profit that can be made from renovating will make it an ideal stepping stone to the next one.
Research an Area
It’s not very often that the perfect property is the first one you look at. Do some research prior to making offers. Decide what suburb or area you would like to live in, check out the schools and shopping centres and go to as many open houses as possible, get online and look at what is for sale as well as what has been sold and at what price. It won’t take long and you will be an expert. Check out unrenovated, renovated or new homes so you know what price you will pay and the true value of homes in the area.
Give me a call
If you have any questions or want further information, you can call me anytime on 0402 203 303 or email rob@rwfs.com.au.
“For first home buyers, the idea of making such a big investment with the associated debt, can be frightening.”
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