Being a first home buyer can be a confronting experience. You’re entering into the transactions cold, often trying to trump other more experienced buyers and grappling with your hopes and limitations.
While there are many things that can go wrong, there are five typical mistakes to watch out for. Here are the most common trip-ups and how residents in Brimbank can overcome them.
Not enough research
Not taking the time to research is one of the biggest setbacks any buyer can face, be they a first-timer or a multiple property owner.
Research comes in many forms, some of which can include paid-for reports. Other research is less tangible, and often involves visiting the area and inspecting local properties. First home buyers are advised to give themselves enough time to explore the market, both online and off, before diving into a purchase.
Tip: Create yourself a research plan that involves heading to auctions in the months before you are ready to put money down onto a property.
Buying on emotion
It’s natural to feel emotional about purchasing property. After all, it’s likely you’ll be living in this dwelling for a lengthy period of time and calling it your ‘home’. You are also most likely making a significant financial commitment to the project. These aspects always come with emotions involved. This can range from desperation and excitement to pride and fear.
Tip: If you don’t trust yourself to keep your emotions in check, either pay a professional to buy for you, or find a trusted acquaintance to play your ‘devil’s advocate’ questioning your decisions. Remember, taking a five-minute step-back now will save you plenty of money in the long run.
Relying on those who are not experts
Younger first home buyers, especially, are prone to asking their parents, friends and those they don’t know online for help. While these three avenues can prove very useful, it’s important that you are aware of the source of the information, why it is being provided and how it relates to you.
Tip: Ensure who you are speaking to is qualified, and if you’re not paying them then know how they get paid and their motivations for giving you this information.
Being aware of what the bank will lend you is one, very critical, element to purchasing. However, being aware of what you can realistically afford is just as important.
Tip: Set yourself up a financial plan ahead of time to see if you can afford the mortgage repayments. Also bear in mind extra unexpected costs, and speak to a professional about insurances for the worst case scenarios.