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Top Ten Mistakes of First Home Buyers

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Planning on buying a house requires a careful

decision and so is purchasing your very first home.

Here are the top ten things which you will need to

avoid with regards to purchasing your first and

brand new home.

1. Not Securing the Pre-Approval

Once you have decided on buying a new home,

one of the most important things that you have to

deal with is to be pre-qualified for a loan. Through

this approach you will determine if you can afford

the offer of the loan provider at the earliest time.

You can also take the necessary preparation for

seeking your preferred home location. Be sure that the pre-approval of the loan provider

is written. Through this you are confident that you can make a potential offer on a

property auction or on a new home.

2. Unable to do the Research

If you failed to understand the market and what properties are worth buying, you will

also fail in obtaining the appropriate property at a reasonable price. There are numerous

areas where you can search for property prices. You can take a look at auction entries

from newspapers, search the internet or perhaps inquire current property sales from

authorised real estate agents. You can also take a look at the sales report records of a

suburb which you find interesting. Sales reports can provide you a complete breakdown

of sales on a street to street basis.

3. Does not understand the entire Sales Process

Before starting into your research, beware of the feasibility of buying a house. For

instance, you need to understand how auctions and biddings work, what is the best

approach of making an offer or perhaps learn the basics on purchasing a property. It is

also essential that you know the tricks and traps of real estate agents. You can also

seek the advice of family and close friends who happen to have had home buying

experiences.

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4. Not Considering all the Factors/ Issues Within the Property

While searching for your ideal first home, you have to consider other important issues

apart from checking the outdoor area and rooms. You need to take account of the

following:

What your neighbours are like

Aircraft Noise (for areas near the airport)

Traffic levels of the local area

Available parking spaces

Disturbing industrial activities

Improvements and developments near the area (you can ask the local authorities

w/ regards to this concern)

How does the streets look

Here’s a helpful tip: Try to visit the surrounding area of the property at different days and

also at different times. See what issues you will encounter. This will assure you that

there will be no concerns that can affect your quality of living after you move in.

5. Selecting the Wrong Area

The location of your new home is a big part of your day to day living, thus it is very

important to make the appropriate decision when selecting for an ideal place to live in.

Here’s a helpful list to check out if you have chosen the suitable suburb. Try to consider

these issues:

Check the public transportation facilities. How do you find it?

Is there a need for you to commute for many hours just to get to work?

How do you find the environment and the local facilities?

If you have a family or are planning to start one, are there any child care services

located near the area like day care, pre-schools, parks, childcare centres,

hospitals, and etc.?

6. Unable to get a Strata Report or Property Inspection

Perhaps you have heard about tragic stories from those who have purchased a new

house and in a few months it suffered from a termite infestation. You might think that

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this could never happen to you but take note that buying a new house demands a very

expensive financial commitment from you. It can even lead you to shocking expenses if

you will not survey the property with building and pest inspection before making the

purchase.

A. Pest and Building Property Inspections

Once the property inspections is done prior to the purchase, you will be able to take

account on the current state of the property, the bid at the auction or the contracts will

have the statements of the existing state of the property and you will be able to pinpoint

any damages including building defects, cracking walls and the like. Hence, you will be

able to determine the possible cost for fixing them. A detailed building report can cost

you more or less $500. Of course, you also need the permission of the property owner

prior to the inspection.

A pest inspection report is different from the building inspection report. The building

report focuses on the physical or visual damages perhaps caused by termites and it will

not include the existence of timber damaging pests including termites. It is

recommended that you get a separate building and pest inspection report before buying

a property.

B. Strata Searches

Once you purchase a strata property, it is very important that you perform a strata

search, one which looks for the entire report of the strata scheme. This search can help

you discover unknown factors which can affect your potential of becoming the property

owner. You can do the record search yourself if you can’t afford to pay for the strata

managing agent. You can also ask the assistance of companies which specialises in

services that provides reports and information that you need to know. Commonly, these

services can be arranged by your solicitor and will discuss with you critical matters

including owner disagreements, proposed or current litigation and any other financial

issues which can possibly affect the new owner.

7. Not acting immediately

Once you have seen your ideal house, you might want to act immediately. It might be

the first house or the ninth apartment that you see, if you think that it is the right one,

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affordable and you have done all the necessary research and gathered all the important

info you need, don’t let it wait for too long. Make the offer right away before someone

else will get it.

Here’s a tip: Do not buy a property which you are unsure of.

8. Unaware of Gazumping

After you already made the offer and it has been accepted verbally and the real estate

agent informs you that the deal is closed, don’t be tricked and believe that that property

is now yours. Wait for the time when you and the owner changed and signed the legal

binding contract. In case there is another buyer who is also interested in the property,

ask your real estate agent if they offer a higher bid so you can counter bid.

9. Being emotional

Searching for an ideal home can be stressful, it would be best if you will not let your

emotions stand in the way since it can greatly affect your transaction. This is evident in

auctions since bidders can be easily get carried away. If you find yourself emotionally

attached, it would be best to ask someone to do the bidding for you.

10. Getting beyond your Budget

For any homebuyer, you must not go beyond your financial means and budget, doing

that will affect you and your family’s financial state. It is always best to play safe and

consider the things that might happen in the future like for instance losing a job or

finding it hard to pay the increased interest rates.