10 Mistakes Which All First Home Buyers Generally Make
Feb 14, 2020 19:26
Buying your first home is always an exciting journey. After all, it’s one of the biggest purchases most people make in their life. However, the process can be confusing and intimidating especially for first-timers.
Luckily for first home buyers in WA, we’ve compiled a list of mistakes that buyers often make so you can avoid them.
1.Not Doing Your Research
Many house buyers neglect to research the area they’re buying into, the general property prices, and even their own finances. You should always take a look at your finances, requirements, and long term goals when it comes to buying a house.
You should also get to know the area including any upcoming developments, available amenities, and whether it fit your family’s needs and lifestyle.
2.Being Influenced By Market Price Alone
While knowing market trends can be useful if you plan to flip your property in the short term, it’s hardly a good indicator as the property price can be influenced by other factors such as the condition of the house and its location.
If you plan to get a long-term home, it’s best to find a house that suits your needs and lifestyle. Don’t let the market alone influence such a crucial decision like choosing the right home. After all, it’s not just an investment - you’ll be living in it for years to come
3.Getting The Wrong Home Loan
Online calculators such as a first home loan calculator can be extremely useful for first home buyers. However, that’s only the first step.
You should also get yourself pre-approved so you can better find a house that you can afford. To find the right loan package for you, look at what multiple banks offer, or better yet, consult an independent finance broker who can advise you on the best mortgage option for you.
4.Following Your Emotions
Buying your first home is an emotional process, and you might be excited to finally own a house. However, stay level-headed when deciding on the right house, as there are always other houses to look at.
If you think you’ve fallen in love with a house, consider all its pros and cons first including its condition, price, location, and if it fits with your long-term needs.
5.Applying For New Credit
Many new home buyers don’t realise how each of their assets and credit actually influences their chances of acquiring a home loan and for how much. In general, avoid taking out other loans or applying for new credit cards before applying for your house mortgage.
Also, try to avoid making big investments to ensure your loan is approved for the amount you desire.
6.Skipping The Professional Building Inspection
Always get a professional and independent inspector to inspect a property before you sign on the dotted lines. They’ll do a thorough check on the house to identify if it has any damages or pests.
By doing this, you can avoid spending a fortune on repairs and pest control. Plus, you can use the inspection results to negotiate a better price on the house.
7.Buying Cheap Instead Of Buying Right
Cost is always a concern when buying a house. However, don’t skimp on too many things and buy a cheap property just because you can’t afford better ones.
If a house is cheap but is in a less than ideal location for you and has underlying issues that you don’t know about, it may actually cost you more in the long run. It’s OK to look around and delay your purchase for a while if you continue to do proper research into houses you can afford.
8.Underestimating The Full Cost of Home Ownership
First home buyers may not realise that buying a home comes with numerous other costs such as legal fees, stamp duties, loan application fees, and future ownership costs for maintenance and repair, as well as council rates.
Find out what is the overall cost for purchasing and owning a particular house and make sure it’s within your capabilities. That way, you won’t be shocked when you encounter a host of unexpected expenditures.
9.Missing The Right Protection Clauses In Your Contract
Make sure that there are sufficient clauses to protect your interests before you sign a contract. Standard contracts have a cooling-off period so you can thoroughly review the contract before signing it, so go through it in detail with your solicitor before you sign it.
Once you’ve signed a contract, you need to sign a completely new contract if you need to change any information in it, and this may mean you risk having to renegotiate the deal.
10. Diving In Alone
While it’s true that there are a lot of resources for first home buyers to refer to online, you should always have a buyer’s agent representing you. They can research the suitable properties for your needs and will look after your interests.
If you end up negotiating alone with a seller’s agent, you might not get the best deal possible. An agent on your side, however, will advise you on the pros and cons of the various options available. Being a first home buyer can be intimidating, but with enough preparation and patience, you can find the perfect home for you and your family.
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