Buying a home isn't easy. WHY?
There are expensive and overpricedhouses.
There are poorly maintained homes.
There are the 90s leaky buildings.
Many prospective buyers have been to upward of 15-20 open homes before they find something they like.
They're competing with others for that same property.
There are some bargains around but to secure one requires patience, detachment and clarity of purpose.
If you're buying in this market, it's important to do your homework more than ever.
Some tips for you:
1. Go hard and fast.
In your first few weeks get out and see as many properties as you can. The faster you get an understanding of the market, the faster you'll appreciate what a good property looks like and what you're prepared to pay for it. You need to move quickly if you find a great buy.
2. Be realistic. A number of first -home buyers start their hunt looking at properties (and going to auctions) well above what they can afford. Eventually they are tired and start looking in the right price range.
3. Be inquisitive. If a place is cheap (and looks good) it's usually because something is wrong with it. Do some basic checks yourself before paying to get a building inspection.
4. Check that everything works. A building inspection will throw up structural issues with a house but could miss the small stuff such as heated towel rails, spa pool, dishwasher, dryer, drains, hot water, central heating, fans and oven.
5. Consciously appoint your advisers. (Broker/banker, lawyer and building inspector).
6. Make sure you can afford the mortgage. Banks will approve you for more than you can afford. It's important to have a realistic budget and to plan on higher interest rates.
7. Plan your mortgage properly. If you're going to have kids, travel overseas, go back to study, work out what that means in advance for your budget.
8. Pay more than the minimum. If you pay the minimum you will not get ahead and your mortgage costs will increase when rates go up. Getting mortgage-free in 10 or 15 years is easy if you are disciplined about it.
9.Get independent advice. There are a large number of packages out in the market, low equity fees to watch out for and different lending criteria across banks. A good mortgage adviser can look at all of the options to make sure you get the best possible outcome. That may end up being your own bank, but at least they could present you with different options.
10.Avoid consumer finance. Although a hire purchase may be interest-free, at some point it needs to be repaid and will then impact on how easy it is to live with your mortgage.
11. Tip: A home and income property can be a good way of leveraging yourself into a better suburb. It can lift your borrowing power by $150,000-$200,000. It feels great to earn income off your house.It can also be a risk if your mortgage repayment ability is dependent on the rental income.
BEFORE YOU GO HOUSE-HUNTING, GET YOUR LOAN PRE-APPROVED.