Buying a home is quite a complicated process, and can be quite daunting even for repeat buyers, but you can look and sound like an expert if you remember these helpful tips.
1) Calculate the actual costs
“If you can only just afford the monthly repayments on the property, you should perhaps think twice about buying it,” says Shaun Rademeyer, CEO of BetterLife Home Loans, SA’s biggest mortgage originator.
“Make sure you also have the budget to cover ongoing expenses and fees that may increase in the months and years ahead – just as you would think about insurance, maintenance costs and tyre replacements when buying a car.
“Keeping your bond payments at less than 28% of your salary to accommodate these extra costs is a handy way to calculate a comfortable budget.”
2) Consider how long you may be staying
If this is literally your dream home, it may feel like you’ll never want to leave, but life is full of surprises and you should still consider what it might cost to sell and move if you suddenly had to.
Rademeyer says: “If you do stay for more than five years, the chances are that you will have built up enough equity in the property to pay back the bank, pay the estate agent and have enough left for the deposit and transfer costs on a new home.
“However, if there is a possibility that you may have to move sooner than that, it is a good idea to stay away from 100% home loans and pay as big a deposit now as you can afford.”
3) You have to sit somewhere
Having an indoor picnic can be great but spending every night in your pillow fort on the floor while your new neighbours can see through the windows might get old.
You will most likely need at least some additional furniture and other home furnishings, and should also not forget to budget for your actual moving-in costs; additional insurance for your belongings; one-offs such as water, electricity and phone connections and possibly, some minor repairs and paint.
4) Location, location, location!
It’s probably been said a million times, but picking an area with a good reputation and good prospects is just as important as picking one that suits your lifestyle.
“If you enjoy socialising, for example, you may want to choose an area that has more restaurants and nightlife, but should take care that it doesn’t have a run-down look about it in the daytime,” says Rademeyer.
“If you have children, you will obviously be inclined to pick an area with good schools, but again, you should not forget to check whether property values in the area are rising or falling. A neighbouring suburb could be doing just as well or better and have less traffic.”
Young people who are looking to live away from the city centre but still within walking distance of shops and community amenities such as libraries and sports centres should not automatically choose a new live-work-and-play area either, he says. They may well find all the convenience they require as well as great value growth prospects in and older, well-established suburb.
5) Be gracious during the negotiations
Many sellers are hoping to find a buyer that will love and cherish their home as much as they did, especially if they have lived there for some years.
“As a result, something as simple as a promise to keep the roof green because it’s important to the seller and suits the style of the area could result in your offer being accepted while a higher offer is refused because that buyer intends to paint the roof red,” says Rademeyer.
“On the other hand, the sellers may not want to hear all about your plans to chop down their treasured trees to make more room for parking, so if you really want to buy the property, it is better always to stick to what you do like about it, and let your agent do the negotiating.”
Article from betterlife