First time buyers - property buying 101
Buying your first property is most likely one of the most exciting things that you will ever do, but whilst it is exciting nerves will also creep in and could alter the situation to such an extent that it could become daunting. There are however plenty of tips to help you ensure that this remains a good experience and hopefully one that you would like to tackle again in the future.
Sort out your Debt.
We all have debt to some extent. It is imperative that if you have quite a bit of debt to first get that under control before you apply for a home loan. Debt that you could possibly look at paying off before buying a home could be things like, student loans or credit cards. Your credit score has an impact on whether a bank will grant you a loan or not, so ensuring that your debt is taken care of and that your credit score is good, is one of the best first steps to take before looking for a home.
Establish Budget.
Debt taken care of and now you are excited to start scrolling through the web for that dream home. Before you start scrolling through Property24 to look at all the beautiful options out there, it is very important to establish what your budget is going to be. This would be a total monthly budget which will now include your monthly home instalments, rates and taxes, maintenance, food, medical, savings and the list goes on. Once you have set up a budget for yourself, the next step would be is to be preapproved. Preapproval is a valuable process. During this process you will find out exactly how much you will be able to lend from the bank and therefore you will know the amount that you will be able to spend on a house. Your purchase power will be a guide to which houses you should be placing your focus on. Outside of informing you what you could possibly afford, preapproval also positions you as a serious buyer.
Research where you would like to live.
The area where you buy a home will play a major role in your life. Things to take into consideration here would be how far would you have to commute to work, are there schools in the neighbourhood, how close are you to your daily amenities such as shops, medical etc. Everyone's needs will vary here, but it is important that you take your specific needs into consideration and try and buy in an area that accommodates as much of the above as possible. Other factors to take into consideration here would be, is the resale value of the properties in the area. Do you see a constant growth or is the value of properties declining.
What type of home do you want?
Many might laugh at this statement, but when looking for a home, it is quite important to know what it is that you are looking for. When you know what you are looking for you can streamline your searches and guide your agent in a certain direction. There are plenty of options on the market and some of these include: Detached homes, Duplexes, Apartments, Townhouses, Estate living etc. Decide what you are looking for and then add a few items to the list that you would like your home to have - for instance, three bedrooms and two bathrooms.
Extra Costs involved.
There are a few costs that not many people talk about with regards to buying a home. Bond and transfer costs are quite high and need to be paid up front so that the home will eventually be able to register on your name. Ensure you speak to your Property Practitioner with regards to this. You will be able to work out an estimate cost based on the price range of the home that you are searching for. The best would be to try and ensure that you have these costs cash when putting in your offer already.
Follow through on your offer.
By the time you have decided to put an offer on paper, you need to ensure that the decision that you are making is an informed one and that you are 100% interested in the property. Unfortunately cancelling an offer is not as easy as what some may think. An offer is a legal binding document and there are likely to be financial penalties should you wish to cancel this contract. The amount payable will also depend on the agreement that has been signed.
Have your paperwork ready.
You have put pen to paper and made an offer on your dream home, now it just needs to be accepted by the seller. Once your offer has been accepted, you will be expected to submit a few documents. Ensure that you speak to your agent with regards to the documents that will be expected from you and ensure that you get the paperwork ready while you wait for your offer to be accepted.
