Buying a home can be a stressful, emotional, and draining process. This is multiplied when you are new to buying property. There is more to learn and a lot to consider. All the while, you are experiencing what is most likely the largest purchase to date. Yes, buying a home is not easy, but it can be made easier with the right guidance.
Seeking professional advice, such as from Brisbane property valuers, lenders or financial advisors is what many first-time buyers do to get as much information as possible before diving into buying real estate. To get you started, we have provided some helpful information and considerations for first-time home buyers. Here are a few mistakes you want to avoid when buying your first home.
1. Buying emotionally
It makes complete sense to be excited by the idea of buying your first-ever home. It does not happen everyday. It is also the start of a new chapter in your life. However, as exciting as it may be, you need to remember to think rationally when you can, as this is a huge investment.
Buying property can cause a huge financial burden, so it requires a bit of caution. Market value is a huge consideration. When you are buying real estate, especially at an auction, it is easy to pay well above market value, especially when driven by emotion. To help prevent this from occurring, do your research, and learn the current market values of comparable properties in the area. You could also enlist the help of residential valuers to complete a pre-purchase valuation to help you with price negotiations.
2. Ignoring other costs
There is more to buying property than what you pay for the house itself. Homeownership comes with many costs, and it starts right from the very beginning. It’s very common for first-time homebuyers to be blindsided by added costs associated with a real estate purchase. This includes such things as:
- Stamp duty: also known as transfer duty, this is a tax that is paid when you acquire property. There is a concession available in Queensland for first-home buyers if the home has been valued under $550,000 which can save you $15, 925. If the house is valued between $500,001 and $549,999 then you need to pay market value to be eligible.
- Insurance: unfortunate events can happen, and there is an added feeling of devastation if something were to happen to your first home. Stress is increased further if you do not have the savings to pay for any damages.
- Legal fees: buying real estate comes with paperwork and contracts. This then comes with added costs that should be accounted for.
There are other costs as well, such as moving services and new furniture. While there are ways to save in some areas, be prepared to pay for more than you expect.
3. Poor financial planning
Real estate is a tough business to be in and requires a lot of knowledge to navigate. Of course, the average person that is only concerned with owning their own home may overlook a few things. Property investors are used to thinking about their present and future finances and must consistently keep an eye on market trends. While a homeowner does not need to approach this as intensely as an investor, it is always good to observe the changes in property values and mortgage interest rates. This can help you choose the right time to buy your first property and what kind of mortgage may work best long-term. First-time homebuyers may also want to consider applying for a pre-approved home loan to help with budgeting and securing a fair mortgage rate.
4. Not having a professional by your side
When buying property, going in it alone without any guidance can be a recipe for disaster. Worse still if all advice you follow is from well-meaning family members and friends. While they can have some great insight into buying your first home, a property professional with years of experience and expertise will provide a more precise assessment and reliable advice.
As knowing market value is so crucial to buying a home, it is highly recommended to use the services of a property valuer. Their report provides a lot of much-needed information and later down the line, they can provide reports of retrospective values for compensation or tax purposes.
For more about hiring a property valuer, get in touch with one of our specialists today. Their knowledge is at your service.