Buying a home is a big deal. It’s not like picking out a new phone or deciding what to have for dinner. It’s a significant life decision that requires careful planning and consideration. But don’t worry, we’re here to help make the process as smooth as possible. In this Home Buying Guide, we’ll walk you through the steps to buying your first home, from saving for a deposit to settling into your new place. So let’s get started!

Tip 1: Save for a house deposit

Saving for a house deposit is often the first hurdle aspiring homeowners face. It requires discipline, sacrifice, and careful budgeting. Begin by establishing a practical savings target aligned with the cost of homes you’re eyeing and the amount you can borrow comfortably. To boost your savings, contemplate trimming unnecessary expenses like dining out or subscription services and divert these funds into a specialised account for your house deposit. Maintaining a separate savings account can aid in monitoring your advancement and deter you from tapping into your savings for unrelated expenses.

Tip 2: Work out what you can afford to borrow

Before you start house hunting, it’s essential to understand your borrowing capacity. To figure out how much you can borrow, you’ll need to take a close look at your income, expenses, and debts. Lenders usually check these factors to gauge your financial situation and decide if you qualify for a home loan. One common method they use is called the debt-to-income ratio. It’s important to be honest and accurate when providing financial information to lenders to avoid overextending yourself financially. You can use an online home loan mortgage calculator or consult a financial advisor to help you crunch the numbers and determine a suitable borrowing amount.

Tip 3: Find the affordable home loan rate

With your budget and borrowing capacity in mind, it’s time to shop for the affordable home loan rate. Interest rates can fluctuate greatly among different lenders, making it worthwhile to conduct thorough research to locate a loan with favourable terms and conditions. Consider fixed vs. variable interest rates, loan terms, repayment options, and additional fees or charges. You can use comparison websites, consult with mortgage brokers like LiveInvest, or negotiate directly with lenders to find the most suitable loan for your needs.

Tip 4: Compare home loan rates.

Comparing home loan rates is crucial to ensure you’re getting the advantageous possible deal. While interest rates are a key consideration, it’s also important to look beyond the headline rate and consider the overall cost of the loan over its term. Consider the impact of extra charges like application fees, ongoing fees, or early repayment penalties, as they can greatly affect how affordable a loan is. Remember, the lowest interest rate may not be the best choice if it includes strict terms or undisclosed costs. A mortgage broker can help you in understanding the complexities of home loans and finding one that suits your requirements and preferences.

Tip 5: Get help if you need it.

If you’re feeling overwhelmed by the home buying process or unsure where to start, don’t hesitate to seek help from professionals. Mortgage brokers, like LiveInvest, can provide expert guidance and assistance throughout the home loan application process. They have access to various lenders and can help you find competitive loan options tailored to your financial situation and goals. Mortgage brokers usually operate on a commission model, where they receive payment from the lender. This means that borrowers often don’t have to pay for their services directly. By tapping into their knowledge and extensive network within the industry, you can streamline the process of securing a home loan. This can ultimately result in savings of time, money, and the hassle of dealing with the intricate aspects of the home loan market.

Tip 5: Get pre-approval to buy

Once you’ve found a suitable home loan, it’s a good idea to get pre-approval before you start house hunting in earnest. Pre-approval involves submitting a formal loan application to a lender, who will assess your financial circumstances and creditworthiness to determine how much they’re willing to lend you. Getting pre-approval clarifies your borrowing capacity and signifies to sellers that you’re genuinely interested in purchasing their property. It can also streamline the home buying process and give you a competitive advantage in a competitive market, as sellers may be more inclined to accept your offer knowing that your financing is already sorted.

Tip 6: Find a house to buy

Now that you’ve sorted out your finances, it’s time to start looking for your dream home. This is where the fun really begins! Begin by pinpointing what matters most to you, including where you want to live, the type of property you prefer, its size, and the amenities it offers. Consider factors such as proximity to work, schools, public transport, and recreational facilities, as well as the overall vibe of the neighbourhood. You have several options for finding properties that meet your criteria. You can browse online listings, visit open houses, or collaborate with a real estate agent who can assist you in locating suitable properties.

Tip 7: Know why you’re buying.

Before you start house hunting, it’s essential to clarify your motivations and objectives for buying a home. Are you looking for a place to settle down and raise a family, or are you interested in property investment for rental income or capital appreciation? Understanding your goals will prioritise your needs and make informed decisions throughout the buying process. It’s crucial to think about your future goals and how your housing needs might change over time. Buying a home is a big financial decision that should match your lifestyle and dreams.

Tip 8: Consider your must-haves and nice-to-haves

When evaluating potential properties, it’s helpful to make a list of your must-haves and nice-to-haves. Must-haves are essential features or characteristics that are non-negotiable for you, such as the number of bedrooms, bathrooms, or parking spaces. Nice-to-haves such as a backyard, swimming pool, or modern kitchen are desirable but not necessary. Knowing exactly what matters most to you will guide your search and enable you to make better-informed choices when evaluating various properties. Keep in mind that compromise may be necessary, especially in competitive markets where inventory is limited. Be flexible and open-minded, and don’t be afraid to prioritise your must-haves while being willing to compromise on your nice-to-haves.

Tip 9: Settle on your new home.

Once you’ve discovered the ideal property and successfully bargained on a purchase price with the seller, it’s time to wrap up the sale and get ready for the settlement process. This involves completing legal and financial formalities, such as conducting a building inspection, arranging conveyancing, and finalising your home loan. It’s crucial to collaborate closely with your real estate agent, solicitor, and lender to guarantee a seamless and stress-free settlement process. On settlement day, you’ll exchange contracts, settle the outstanding amount based on the purchase price, and officially take ownership of your new home. Congratulations – you’re officially a homeowner!

This process is similar for commercial property finance, though it may involve additional steps and considerations tailored to the commercial real estate market. Working with professionals experienced in commercial transactions can help streamline the process and ensure a successful outcome.

Final thoughts

Buying your first home can be a daunting process, but with the proper guidance, it doesn’t have to be. By following the steps outlined in this Home Buying Guide, you’ll be well on your way to owning your property. So take your time, do your research, and don’t be afraid to ask for help along the way. Before you know it, you’ll be unlocking the door to your very own home sweet home.