In case you haven’t heard, 2016 is the Year of The Monkey in the Chinese Zodiac. But more specifically, it’s the Year of the Fire Monkey.
The general opinion of people born under this zodiac sign is that they are smart, clever, resourceful and intelligent. Especially when it comes to career and wealth.
It has also been suggested that the common traits of people born under this sign symbolise the theme of the Year of the Monkey overall. Adding the element of fire to the Year of The Monkey brings a whole other dynamic.
The element of fire is said to promote more focus and a lot more attention, meaning seeing things through and getting things done.
So if 2016 is the year you decide to buy your first home, make sure you make smart intelligent decisions and avoid these common first homebuyer mistakes.
1. Over committing
What you can borrow and what you can afford can be two very different things. Getting a home loan pre-approval is a good first step to understanding what you can borrow and therefore what and where you can buy. In addition, having a well thought out budget that factors in your income and expenses is equally important. Don’t stretch your self to the point of being uncomfortable and not being able to enjoy life but make sure your still have a safety net for any unexpected costs. It’s also important to remember though that if you’re still relatively young, your best earning years are still ahead of you. It’s all about getting the balance right and determining what’s right for you.
2. Paying too much for a property
Without question this is one of the biggest and most costly mistakes a novice homebuyer can make. Unfortunately its also one of the easiest traps to fall into. Luckily though, it doesn’t cost anything more than an investment of a few hours of your time to avoid. The single best piece of advice for new homebuyers is to spend time online and physically inspecting properties, then following up with real estate agents or checking online to see what they sold for. The more recent the better as it will be a true reflection of where the current market is at.
3. Not understanding all the costs
When you’ve never owned a property before it’s important that you understand all the costs involved, both before you buy and after you move in. Before you can call a property your own there are a number of costs you will need to allow for. As well as your deposit you need to allow for other costs such as legal/conveyance fees, stamp duty, mortgage stamp duty, home loan application fees, pre-purchase inspection reports, lenders mortgage insurance or low deposit premium (where applicable). After you move in, as well as your regular mortgage payment make sure you factor in council rates, utility (gas, water, electricity) costs, insurance and regular maintenance costs as well.
4. Not doing your homework
Making an offer on a property and having it accepted is just one part of the home buying process. As a first homebuyer you’re probably not going to have a lot of money in reserve. The best way to protect yourself from nasty surprises or unexpected costs down the track is to get a pre-purchase pest and building inspection report done. Spending a few hundred dollars on due diligence before you seal the deal could literally save you thousands down the track.
We all have to start somewhere and there’s no such thing as the perfect property. If you have a tendency to be a perfectionist, deciding on the right property might prove to be a struggle. It’s important to keep in mind though, that your first property will probably not be your last. If it ticks most of the boxes, you’ve done your homework and you can afford it, then ask yourself ‘what am I waiting for?’
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Shelley Horton is the founder and director of Sydney based exclusive buyers agency Albion Avenue. With a 20 year career honing her skills in every aspect of the property industry Shelley knows what makes a property worth buying and how to get the best deal.
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