Owning your own home is still the Great Australian Dream, and it can be a sign of independence and a chance to build wealth. However, saving a deposit takes time, getting approval for a loan has become more difficult, and many first home owners are also contending with property investors. However, buying your first home is a rewarding experience, and below are a few things to consider as you prepare to step into the property market.
1. Can you get the money?
The first (and most important) consideration is your financial stability – without access to funding, there’s no point in house hunting! When you’re applying for a loan, banks scrutinise your income, assets and existing debts and liabilities to determine whether you’ll be capable of paying the loan off. The higher and more stable your salary, the more likely you are to get the money. If getting a loan on your own seems impossible, there may be ways to partner up with a friend or family member to take your first step.
2. How do you buy a home?
It sounds straightforward, but there’s actually a lot of information to process. Knowledge is the key to smart property buying, so if you’re new to the world of property, it’s wise to get expert advice, especially for the legal side of things. Talk to agents, and remember to contact me to help you handle the complexities in a contract of sale.
3. What are you buying?
Buying a home is a complex but exciting experience, and it’s important that you don’t get too attached to a property until due diligence procedures have been undertaken. This includes a building and pest inspection and a strata inspection (if you’re buying a unit). This will hopefully highlight nasty ‘surprises’ such as hidden mould, structural problems or plumbing or electrical issues, before you’ve committed to purchase the property.
4. Other Costs
The cost of buying your first home doesn’t stop with the deposit – you also need to consider stamp duty. The NSW State Government currently offers the First Home Buyers’ Assistance Scheme (partial or total exemption from stamp duty) and the First Home Owners’ Grant Scheme ($10,000 grant towards buying/building a new house). Eligibility requirements are stringent, and you should check your eligibility on the Revenue NSW website. You also need to consider the cost of Lenders Mortgage Insurance, legal fees and bank fees when determining whether you can afford to step into the market.
5. Are you ready?
In the end, it’s all about your readiness to enter the market. While technology is making buying a property easier, there’s still a lot to consider. If you are ready to invest your time, money and energy, then you may be ready to take that first step! Now is a good time to pay off credit debt, build a strong employment record and work on saving as much as you can.
At Julie Earl Conveyancing, I am committed to providing exceptional customer service. If you require any advice or more information, give me a call on (02) 6687 6466 or by email, julie@julieearlconveyancing.com.au