Purchasing a home for the first time can be a very emotionally driven experience. There are so many new and exciting things to consider, and sometimes complicated processes to negotiate. Often it can be easy to get caught up on the smaller details, losing sight of the bigger picture and possibly making mistakes that you will pay for in the future.
Here are a few tips on what to avoid when purchasing your first home:
Mistake - Not getting pre-approval
Once the decision is made to buy a property, it might be tempting to jump straight into looking for a home. However, this could lead to disappointment down the road. You may end up finding a home that you love, only to learn that it is out of your price bracket when applying for finance. Rather start the process by consulting with a bank or a bond originator such as Betterbond, which can assist in determining what bond amount you qualify for. Getting pre-approval on a bond will save both you and the seller a lot of time. You will be able to sign an offer to purchase knowing that you have the finance available to purchase the property.
Mistake – Not working out what you can afford
There is often a difference between what you qualify for and what you can afford, bearing in mind that it always wise to have some cushioning in the budget. Have a look at your finances and make a list of your expenses before settling on a house budget. If you know what you can afford it will narrow down the search and ensure that you are not looking for homes outside of your budget. Don’t stretch your finances too thin, as this will make you vulnerable to any unforeseen circumstances.
Mistake – Focusing on the flaws
While you shouldn’t compromise on your must-haves, don’t overlook a home that essentially meets your criteria, but may have outdated fixtures. Sometimes you will need to look past certain things to be able to recognise the true potential of a home. If you focus too much on the things that are wrong with a home, you may miss the things that are right. Keep the crucial elements in mind, but be able to compromise on aspects that are less important.
Mistake – Falling in love blindly
You shouldn’t overlook a home because of its flaws, but don’t completely ignore them. A home’s look is one thing, but more serious issues such as structural damage are quite another. When buyers have seen a property that they think is the one, their decisions will be based on the emotional connection they develop with the home. Remember to look at all the facts before blindly putting in an offer without being fully aware of all the property’s issues.
Mistake – Waiting too long
It is vital to make informed decisions when selecting the right property, but taking too long to decide before putting in an offer could mean losing out to a faster buyer. When you have found the right home, be decisive and move quickly to avoid disappointment.
Mistake – Not thinking about the future
Be sure to consider things such as the resale potential of the home as well as your future plans. While it may seem strange to think about selling the home before it has even been purchased, much of home’s potential return on investment is based on decisions made when the home is bought and not when it is sold.
Factors that will affect the home’s resale value include:
Also, consider whether the home will meet your needs now and in the future. For example, you may not have children now but plan to shortly - this means needing an extra bedroom or ensuring that you purchase near to a good school. It is important to think about whether the home meets your current situation, but also change to meet your evolving needs.