6 Top Tips for Smart First Home Buyers

30.04.24 | Marc Barlow | Resources

6 Top Tips for Smart First Home Buyers

As well as being possibly the largest purchase you’ll ever make, buying a property is also complicated and full of traps. First homebuyers are especially disadvantaged, wading into the world of real estate without much experience.

At Mortgage Broker Melbourne, we always advise our clients to take things gradually, making sure you understand the ins and outs of the property market as well as the range of home loans available.

Here are some tips we’ve collected over the decades. Of course, if any of this has you stumped, we’re always available to help. And best of all, our experience and advice comes at no cost to you … ever.

1. Allow plenty of time

Deciding it’s time to buy, finding the right property in the right location, being the successful purchaser and arranging loan finance all takes time.

Once you’re ready to start looking, avoid the temptation to jump in the deep end and commit too soon. Buying can take many months longer than you planned for. So stay at your parents’ place or extend that lease a little longer. Don’t let your eagerness lead to more stress.

2. Do your numbers properly

Know exactly how much you can afford before you start looking at homes or even suburbs. That $60,000 savings balance doesn’t mean you can afford a $600,000 home.

Many lenders will offer you loans with repayments higher than you might be comfortable with. How much can you afford to repay each month? Will you need to pay lenders mortgage insurance? You’ll need cash for insurance, rates and furniture. And don’t forget stamp duty!Don’t use your rent payments alone as a guide to the expenses of home ownership.

Our home loan experts can help you understand your actual financial position. Talk to us, let us help, and avoid mortgage stress in the future.

Apply for pre-approval after that so you can view properties with intention rather than just hope.

3. Get expert help

Surround yourself with professionals while you’re making decisions about home ownership. Use a certified home inspector, find an accredited solicitor or conveyancer to assess the contract, and don’t just rely on your current bank to find the best home loan for you.

Discuss the realities of ownership with a financial advisor and work with an experienced, independent mortgage broker to find suitable loans, negotiate better deals and help with the pre-approval application paperwork.

4. Location, location, location

When it comes to purchasing real estate, you can never be too informed. There are lots of resources available to make sure the areas you’d like to live in are suitable.

You can get valuable up-to-date locality information from the major real estate websites, as well as organisations like CoreLogic. Mortgage Broker Melbourne has access to industry reports that help you understand the market where you’d like to live. Drop us a line and we’d be happy to share this with you at no cost.

Local real estate agents also have their fingers on the market pulse. Ask about recent sales in the area in your general price range. But remember that they work for vendors and their aim is to get as much money out of you as possible!

5. Know the property, inside and out

Property inspections take a few days and cost hundreds of dollars. It’s an expense many first homebuyers skip. But while a $600 professional inspection might make a small dent in your buying potential, imagine the flip side: termites, rotten stumps, sub-par wiring, no insulation, dodgy plumbing, sub-floor damp.

Does the property smell? Do floors sag in the corners? How’s the water pressure? Does the air-con work? Vendors aren’t obliged to tell you everything that’s faulty. Finding out is well worth the expense.

6. Never feel under pressure

Most of us don’t make good decisions under pressure. Agents are famous for using urgency as a tool to force a sale. Let an agent know you’re serious, but don’t fall for pressure to snap up the property. Use your head, rather than your heart, and try to make a decision based on facts.

Typically, if you might make a better offer than someone else, the agent and vendor will be happy to wait another day or two.

Talk to us

Call one of our home loan experts when you’re ready to talk about a home loan and getting pre-approved. We help you sort your finances, find a great loan, apply and be in a position to buy.

We receive a commission from a lender if you end up buying, which is how we can offer this service free of charge to our clients.

Contact us at Mortgage Broker Melbourne, and get organised before you buy.