How do you make sure you’re getting the best deal for your budget, lifestyle and your future when buying a new home feels like such a big process?
Read on to discover seven crucial things to do before you sign the contract on your new home, so you can feel secure in your big decision.
1. Shop the mortgage market
It’s likely you’ll be taking out a mortgage for your new home, so taking the time to find the best mortgage “fit” from the beginning will pay off in the long term. Home loans vary as much as the people who apply for them, so shopping around and knowing the differences – as small as they may seem – is key.
We recommend seeing a mortgage broker, who can compare lenders and the details of their packages, such as the fixed and variable interest rates, redraw facilities and offset account options (and their associated fees).
Once you know the deals available to you, negotiate. A broker can do this on your behalf. This is a highly competitive market, and lenders will come to the party to get you onside – but if you don’t ask, they won’t offer.
2. Get comfortable with your budget and buying power
Before you set off on the house hunt, it’s important that you truly understand your financial position and buying power.
Sit down and review your current budget. Be realistic with what your weekly expenditure looks like. You want to be able to make your repayments, cover any ongoing costs (utilities bills, insurances etc) and still have some funds left to enjoy life.
A mortgage broker or lender will review your credit score, along with your income, financial commitments, and a number of other factors, before telling you how much you can borrow. That means you should tidy your affairs and pay down any debts as much as possible before approaching a lender.
This is also the time to understand any financial grants you may be eligible for that will help put your dream home within reach.
3. Seek permission to shop (get pre-approval on a loan)
Your lender will likely offer pre-approval for your loan. This is a figure that you should be able to borrow, provided nothing about your financial situation changes and the house you choose passes the lender’s valuation.
Be aware that this figure will be the maximum amount you’ll be able to lend, so it’s a good idea to borrow an amount that’s within reason. There are plenty of stunning, affordable homes on the market that will tick all the boxes and still leave you with plenty to live on. The government grants for new-home builds and first-home buyers will boost your borrowing power, too.
4. Take time to think about what you need
Just like buying the ingredients for your favourite recipe, you should write a “shopping list” of what you need in your new home. If you’re buying off the plan, you’ll have options for layouts, or you can even make changes to the plan before construction to suit your family.
If you’re buying a brand new or existing home, be honest with yourself about what you really need and what you would like to have. The number of bedrooms, bathrooms and garages a property has are critical, but the paint colour, type of lighting or brand of appliances are only preferences and can easily be changed.
5. Do your homework
When it comes to buying a house, it pays to know the area. Taking the time to research a suburb and its features will set you up to enjoy living in your home and to hold or improve property value for when (if ever) you decide to sell.
You can use online tools such as realestate.com and Domain to better understand property prices in the area and you should talk to council, local real estate agents or property groups to understand things like local school zoning, future plans for the area and access to amenities and public transport.
6. Settle in for the ride
Finding your perfect home can take time, and if you’re building a new home, you’ll be waiting throughout construction as well – which can be tough when you’re excited to move in!
Sometimes the home-buying process can hit little snags, like weather delaying construction, or having to break your rental lease. These are all normal hiccups that your property group or agent can help you through, but it pays to be ready for them so they’re not too much of a surprise down the track.
7. Understand the finer detail
Regardless of whether you’re buying a new or existing home, reviewing and understanding the specific detail of the property and your contract before you sign is a must.
Either way, be sure to discuss, confirm and agree in writing to what is included in the home in terms of fixtures and inclusions. Having clear conversations early in the process will save any grief further down the line.
Building a new home with an experienced property group like Insignia Homes makes this step simple. Our knowledgeable team are on hand to answer all of your queries throughout the construction process and will work with you as you choose your inclusions, meaning you know exactly what’s inside your house from the outset, and you’re a happy homeowner at the end.
