For the majority of us, buying property is usually the largest single investment you’ll ever make in a lifetime. While the process may get a little easier over time as you potentially buy and sell a number of houses over the years, it still pays to have all your “ducks in a row” before you can make an offer on a property.
Here are five steps to ensuring you’re ready to go when you find that dream house (or apartment).
1. Do your research
Check out the suburb you’re most interested in. Make sure it has what you’re looking for, depending on your circumstances. Singles may want to live in apartments close to the city, while young families may need a three bedroom house with a backyard and good schools in the neighbourhood. In more regional areas, transport, access to health and government services and a big block of dirt may be the focus.
When you do find the property, accessing services such as those provided by RPData can be very beneficial. They can give you a report which lists median house price data for a given area and also the what price neighbouring houses have fetched.
2. Set your budget
Aussie Goulburn franchisee Jeffrey Norman says it’s vital to ensure you’re realistic when it comes to budget. “There’s no point looking above your price range, as it’s likely that you won’t qualify for the loan amount, and if you do, there’s an even bigger chance that you may find yourself in financial hardship down the track – especially if rates rise.”
He says it’s also important to take into consideration other factors such as loan set-up costs, conveyancing and legal fees and also stamp duty.
“And depending on how much deposit you have, your LVR (or loan to value ratio) will come into play as you may be liable for loan mortgage insurance (LMI),” he said.
Keep an eye on Aussie’s Property Market News & Analysis for Part 2 of this series