Purchasing a property is one of the most significant and life-changing investments in an individual’s life. It’s also a very stressful decision with numerous factors to consider. Whether you’re looking to buy your first homes or purchasing a property for investment purposes, don’t forget to do your due diligence.
According to statistics, over 500,000 houses change ownership in Australia every year. This number accounts for 6% of all the houses in the market.
Have you decided that it’s the right time to purchase a home? There are numerous tips you need to know when buying a house in Australia, so read on to learn more.
1. Determine if You’re Ready
Before rushing to buy your dream house, take a deep breath and look inside yourself to determine if you’re ready for the responsibility. If you’re ready for the commitment, examine your job security, financial situation, and family needs.
2. Examine Your Finances and Determine Your Budget
Before rushing to apply for a home loan, take some time to figure out your finances and determine your budget. Look into your living expenses and your annual income. This will help you assess your capacity and ability to repay future mortgages and any additional fees that come with a new house.
Having a well-planned and realistic budget will come in handy regardless of whether it’s your first home or investment property.
Try out home loan calculators to have a rough idea about how much a bank would be willing to lend you and how much your monthly repayments will be. However, remember that your borrowing power will depend on your monthly expenses, income, percentage interest, and the length of the mortgage.
Budgeting also includes saving up for the house’s deposit. Saving up more than you need could help you cover additional costs such as mortgage application, stamp duty, establishment fees, and legal expenses.
3. Shop Around to Find the Perfect Home Loan for You
Before putting up a deposit for your dream home, take some time to compare different home loan options and choose the best for your situation. Ensure you choose an option that offers value for your specific financial needs.
Key factors to consider when choosing a mortgage company include terms and conditions of the loan, percentage interest rate, any upfront or ongoing payments, and the repayment period.
There are varying options for different people in the market today. Various organizations offer different types of loans for certain groups of people. For example, if you’re a lawyer, you could borrow from organizations that provide home loans for lawyers.
When looking for the right mortgage company, you should consider applying for conditional approval of your loan. This is especially useful for people looking to attend an open house or an auction as it gives you an estimate of how much money you can spend.
4. Start Looking for Your Dream Home
Once you determine your budget and have conditional approval for your loan, you will know the type of house to look for. However, you need to decide which type of home you want. Are you looking for a duplex, a townhouse, or an apartment?
Once you have a rough idea about your borrowing power, you can now shortlist different types of houses and suburbs within your price range. Most websites have different types of homes in Australia, their estimated process, and the areas’ demographic information.
Below are other things to put into consideration when looking for a house:
- Is the home in a convenient area with facilities that are essential to you?
- The features and layout of the house
- Other concerns about the area such as noise level, flooding risks, and demographic info
If you are concerned about the area’s noise level, flooding, or other climatic disasters, you can do some research and talk to people who live in the area. This will help you make an informed decision about the suburb.
5. Choose a Real Estate Agent When Buying a House in Australia
Before buying a home, decide if you require a real estate agent in advance. Working with a real estate agent could make your work easier. They could help you look for the right financing options and help you during house hunting.
Reach out to a trusted real estate agent to help you navigate the property buying process. They will even conduct a background check on the property, eliminating half the stress you could experience during this complex process.
Conduct a Property Inspection Before Settling for a House
If you see a house you’d like to buy, there are essential things that you should look into before forming an emotional attachment to the home. Getting too invested in a property might make you blind to some of its bad qualities.
Below are essential things to look out for when trying to purchase a house:
- Mold and mildew on damp spots such as the basement and walls near sinks
- Buckling walls and sagging ceilings
- Do the windows and doors fit well, and can they close and open smoothly?
- Check the lights and fuse box to ensure nothing is broken
- Examine the drains, gutters, and the roof
- Flush the toilets and open the taps to test for any issues
- Look at the neighborhood to determine if it suits your personal preferences and lifestyle
- Check the exterior walls for cracks
- Check the house’s hot water system and the HVAC system
After checking all the above, confirm if you are willing to buy the property. Ensure you get a qualified home inspector to make a professional assessment. They will look for asbestos, plumbing and drainage problems, lead paint, faulty electrical wiring, and other structural defects.
Are You Ready to Buy a House?
Buying a house is a big decision and a long-term financial commitment that requires a lot of planning. However, you will need to consider more than just your financial standing when buying a house in Australia.
After following all the above home buying tips, you’ll be almost ready to move into your new home. For more enlightening tips, check out other posts on our site.
