Tips on Buying
Making the decision to purchase a property is an exciting time, but it can often come with a little anxiety. Don't stress. The process doesn't have to be daunting. If you have a plan of attack, purchasing a property can actually be an enjoyable process. The following will assist in reducing the worry and angst by focusing on just the essential decisions to be made so that you can concentrate on the positive emotions associate with finding and securing your next home.
1. Start Saving Now! - Start the savings habit early as whilst most lenders require a deposit of at least 5% of the property's value, bigger is definitely better. A larger deposit may help you to avoid costly Lenders Mortgage Insurance, which is charged when a home buyer borrows more than 80% of the property's value. Putting a savings strategy in place early on in your financial lifecycle will make it easier to obtain finance and purchase your dream home down the track.
2. Get yourself "pre-approved" finance - Not only will this give you parameters within which to search what size, style and location of your home, when it comes to negotiation property sellers are often attracted to buyers who have pre-approved finance over those who don't. Loan pre-approval lets you head into the purchase process knowing the maximum amount you have to spend on the property, giving you confidence to even consider buying at auction or negotiate on price. It also saves you from looking at places that aren't in your price range.
3. Know precisely what you want in a property - By becoming decisive in what it is that you are looking for in a property early in the process, you can cut down the time involved in the initial search and get to the selection phase a lot sooner. Buyers can get bogged down in the very preliminary part of the process by being overwhelmed and even confused by having too much to pick from and, as a result of clever marketing, can be lured into property options that meet none of their prerequisites. Write down a list of features that the property must have:
i. How many bedrooms and bathrooms you require;
ii. How many living area are necessary to accommodate your entertaining lifestyle;
iii. Car accommodation is critical if you are considering buying a unit;
iv. How much land is necessary for you to build your home or locate a shed for the boat or van;
v. Is there enough backyard for the kids and the dog;
vi. Side access to get your boat or garden trailer down the side; and of course
vii. Is there a pool... great if you have kids ...not so ideal if you are looking for an investment property.
Once you know exactly what you're looking for, you can narrow down the list of homes you wish to inspect. As a rule, try not to visit properties that don't meet most of your requirements as you may find that you will potentially spend big on renovations and extensions.
4. Location...Location...Location - As important as its knowing what you need from the property, the location is everything for you and it will vary immensely depending on the purpose of the property you are buying and your logistical needs. Narrow your search back to a small number of suburbs based on proximity to your current or pending lifestyle (ie. where do the kids go to school, how far to work or proximity to kids sport) as well as those suburbs that compliment your present lifestyle (eg. quality & socioeconomic makeup of neighbourhood or traffic volumes immediate to the property). If it's an investment property, is there enough need for rental accommodation in that particular area.
5. Seek educated & accurate advice - Far too often do we as agents observe buyers making wrong and ill-formed decisions to their ultimate detriment base on advices from those whom are unqualified to give such advice. Not only can the wrong property be purchased by overenthusiastic encouragement of a friend, but so to can the right property be inadvertently missed when advice given by those overprotective family members.
Speak to a valuer when you really don't know what to spend on a particular home. Don't hesitate to talk to your lender or mortgage broker during the entire search or negotiation phase... that is what they want you to do. Speak to your agent... you can be assured that all Sprake real estate agents will provide you with nothing but honest and accurate advice whether you be selling with us or buying through us.
Have your solicitor give you clarity during the purchase process. They are the most qualified to clarify any legal misunderstandings that you may have relating to a property or the contractual process of purchasing a property.
Have your building inspector investigate the structural condition of the home sooner rather than later and, for that matter, engage a pest inspector regarding any potential pest infestation issues prior to negotiation. Having clarity in these areas will save a lot of pain and heartache later on down the track in the buying process.
6. Finally... you snooze, you lose - indecision or 'playing for time' can lead to heartache when searching for a property. Decide on a propert... set yourself a price limit... and if not achievable... move on. Don't leave to chance your purchase of the perfect property at a good market price by dragging out the negotiation process. "Leaving the seller sweat on it" in most cases sees a buyer either miss out on the property or end up paying too much for the property by competing under a multiple offer situation.