The first steps every first home buyer should take
Updated: May 19, 2022
REIF are helping a record number of first home buyers to get into the property market. We know more than anyone that purchasing your first home is such an amazing time in your life. It's a time where you become responsible for a huge asset and start taking responsibility for your own future.
While homeownership is undoubtedly exciting; it does require a lot of thought and planning. It's not something you want to commit to and then 12 months down the track realise it's something that you can no longer afford to sustain. Hence, why we've compiled a few steps that every first home buyer should take.
Before we assist first home owners with getting into the property market, we like to sit down with them to understand a whole range of factors. The primary one being what they want to achieven from buying a house.
What do you want to achieve from buying a house?
They say that a goal without a plan is simply just a wish. It's true though, great successes generally come from an underlying plan.
It's all well and good to say 'I want to buy a home.' Though, why?
How will buying a house add value to your life? Is it going to be beneficial for your family, your privacy, or does it give you the opportunity to become fully independent?
Determining the reason why you want to achieve homeownership will then allow you to answer more critical questions about what type of home and strategy you want to achieve.
How buying a home benefit you?
Another factor that you should consider before entering the real estate market is how it will benefit you from a long and short term perspective.
At the moment we're seeing a lot of first home buyers entering into the market to take advantage of the brilliant incentives that the Government is offering. Many of these incentives have never been seen before and first home buyers are taking advantage of them now because who knows how long they will be around for. Many don't really care so long as they get their foot through the door.
In that instance, if you are buying to simply just get your foot through the door are you going to be emotionally committed to this asset or is it simply a stepping stone to achieving a bigger goal? Will you eventually turn this home into an investment property later down the track or do you plan on selling it for a profit?
Thinking about how entering the real estate market for the first time is going to benefit you from a long and/ or short term perspective is key to your planning process when becoming a first home buyer.
Do you know how you're going to buy a house?
The how's are often the most difficult questions to answer. Though, they're incredibly necessary to creating success and avoiding failure.
The first how that you need to consider is - how are you going to afford it?
Many lenders require a minimum deposit of 20% to purchase your first home. So, you need to understand how much you can afford to pay in relation to home loan repayments and the other upfront costs that are involved. These upfront costs include; stamp duty and legal/ conveyancing fees. It also pays to determine if you're eligible for additional financial assistance as a first home buyer.
You will then need to consider the other costs involved while you are paying off your home loan. These include rates, maintenance and repairs, insurance, plus much more. Here at REIF we always recommend putting some money aside for a rainy day.
Understanding the costs involved will allow you to make calculated sacrifices and budgets that are essential for being a home owner.
The other important how you need to consider is how you're going to find the home for you and your needs (short and long term).
Understanding local markets and the location in which you want to buy is incredibly important for finding your first piece of real estate. You should also establish whether you want to build a new home or buy an existing one. Here at Real Estate Investment Finance, we much prefer building new property due to their extensive benefits which you can find in this article. However, you need to determine how and why buying new or established will benefit you!
Reach out about becoming a first home buyer
Above all else, it's so important to talk to someone with experience and expertise in this field to answer all of your questions. Our team of Property and Finance Specialists at REIF are always available to answer all of your queries and concerns about entering into the property market as a first home buyer.
We're assisting a range of different clients across the country to make their property and finance dreams a reality.
Feel free to reach out to our expert team on the details provided below. Always happy to help!
Ph: 1300 130 932
We explore this topic on our eBook 'Guide To Buying Your First Home.' You can check it out here for free!