4 things first home buyers should keep in mind
Buying your first home is a rite of passage for many. And if the constant media discussion about housing affordability is anything to go by, it may seem like an increasingly unattainable one.
Despair not first home buyers, by going into the process with your eyes open and having a few handy tricks up your sleeve, you can turn your homeownership pipe-dream into a reality. Put yourself in the best position possible come time to buy with our four tips.
1. Find out what help is available
Buying your first home can be a scary experience, with deposits, loans, and contracts all to consider, but don’t fret, because help is out there. Most state and territory governments offer first home owners grant schemes and/or stamp duty concessions. A first home buyers grant can provide you with a lump-sum payment from $10,000 up to $20,000 in Victoria. These grants and concessions have been implemented to help first home buyers get into the property market sooner; make sure you find out what assistance is available is in your state or territory.
2. Research your home loan repayments
Future-proof your home loan repayments. Sure, with home loan rates hovering around 4% in Australia the repayments may be quite achievable. However, you should always be prepared for a worst-case scenario.
Darren Mehl, Tick Homes’ Chief Operating Officer, believes: “The old rule of thumb is: calculate your home loan repayments at 7%. If you can afford the repayments at 7%, then you can probably afford the home. If 7% means you’ll be eating two-minute noodles for the next 30 years, then you might need to keep saving, or start looking for a more affordable home.”
3. Know what’s involved in the build process
If you’ve made the decision to buy a home, you’re probably over the moon. But beware – it can be easy to get excited and overlook some really important considerations when going through the build process. Make sure you stop and ask yourself:
- What type of home design is right for me?
- What block of land should I choose?
- How much will it cost?
- How long will it take?
- What are the stages involved?
The more thought you put into asking the right questions, the better the result will be – and the more seamless and stress-free the experience too.
4. Stick to your budget
This seems pretty easy to do in theory. After all, unless you have a whole lotta Monopoly money lying around, you can’t spend more than you have, right? Wrong. Very, very wrong.
Most first home buyers are good at setting their financial limits, but they forget about (or are unaware of) many small costs that blow their budget out the window. To avoid such nasty surprises happening to you, Darren suggests: “Think about setting aside an additional 5-10% of your budget as a buffer for unexpected costs such as land tax, conveyancer fees and building inspection costs.”
At Tick Homes, we steer you in the right direction. So go on, get in touch with the team today.