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Know what you're getting into when buying property
Avoid stress and potentially expensive mistakes by carrying out plenty of research before you purchase your first home. Here are some of the key things to consider:

Renovator’s dream or home buyer’s nightmare?

Many existing homes are sold under the pretence of being a ‘renovator’s dream’, yet when the ink has long since dried on the contracts of sale some unprepared new home owners can find that they’ve bought themselves into a ‘home buyer’s nightmare’.

If you are considering the purchase of a home that needs a lot of tender loving care and more than a little renovation work, it’s a good idea to do your research first and make sure that what you intend to do by way of renovations is both possible and affordable.

Have a builder or architect look at the house and provide you with their advice. If you have any ‘dream plans’ in mind, make sure you consult them to see what can be done – and at what price – so that you go into the purchase with your eyes wide open.

In fact, regardless of any renovations you may or may not be considering, it’s wise to have a building inspection done before you sign any contract of sale, so that you are aware of any structural issues that may exist before committing to the purchase.

  
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Beware of pests

Termites, ants, spiders, rodents – they can all undermine the foundation and structure of your home – so it’s best to make sure that none of them are ‘tenanting’ in your new home before you move in. A professional pest inspector can do a thorough inspection and assessment of your home to ascertain whether you have a pest problem or have the propensity for one to develop in the future (for which you can then apply preventative measures).

Do the maths before you hit the pavement

One of the most common ‘binds’ that home seekers get themselves into is looking at properties before they have their finance approved, finding one that they love and then seeking finance only to learn that they don’t have the finances they need. This sort of high then low situation can be disappointing and can also make it a lot harder for home seekers to move on and find a home that they can be happy with as an alternative.

So, it’s vitally important that you spend time finding a home loan provider and a home loan that suits your needs before you start shopping for a home.

You should also make sure that you find out how much money you can borrow – and what the interest rate and repayments will be – so that you can consider homes that fall within your budget. This way, you won’t set yourself up for disappointment and will be able to make decisions with greater peace of mind.

Stick to your budget

It can be easy to convince yourself that you can afford a home that’s outside your price range. What’s not so easy however, is committing to a lifetime of repayments that are outside your means. Be realistic from the start about what you can afford to borrow (and repay) and don’t get yourself in too deep with your mortgage. Make sure that you also budget for potential future interest rate rises.

If you are considering a home that needs renovations, make sure you have the budget to finance the renovations now or that you can comfortably live in the house while either waiting for it to increase in equity or saving up the extra money you need to renovate.

Get to know the lie of the land

When you buy a new home, you’re not just buying four walls and a roof, you’re also buying into a neighbourhood and a lifestyle. So, it’s just as important to be happy with where you live as the house you live in.

The same can be said for investing in property, that is, you want to buy a property in an area in which people will want to rent and live.

So, do your research and find out what you can about your new location. Check out the shops, parks, public transport, schools, public amenities such as libraries and sporting grounds and make sure you’re buying into a location and lifestyle that will be appealing to the rental market and should hold you in good stead for a reliable increase in property value over time, thereby presenting a good investment prospect.

Patience is a virtue

Finding a home that suits your budget and your lifestyle needs is not going to happen overnight. It could take you many, many months to do your research and find just the right home for you. So it’s important to be patient – don't become disheartened if you can't find your home straight away.

Don’t be hasty with your finances and risk making a financial move that will make you pay too much in the long term.

Seek expert advice

It’s important that you talk with experts at all stages of the home buying process.
  • Talk with real estate agents in the areas you’re considering to find out about local prices and the pros and cons of the area.
  • Talk to your financial planner to ensure that buying a property is right for your circumstances.
  • Hire a solicitor to manage all your legal work.
  • Talk with the neighbours to find out what they think of living in the area.
  • Talk with the local council to find out about any possible restrictions you may have in the area, ie types of renovations you can or can’t do, plants you can or can’t plant etc.
  • Do your research to find a lender you feel comfortable with and who can offer you the home loan that best suits your needs.

At RAMS, we have a wide range of home loan options and the benefit of years of home lending advice. So, talk with a RAMS Consultant today – we're ready with home finance advice and a range of home loans to help you secure your dream home.