Tips for buying your first home
By Amanda Scali

2021 is in full swing, and it might be the year that you are looking to take that big step and buy your first home. It is a great time to buy with low-interest rates and other expenditure like International travel off the cards for now.
 
For many Australians, buying their first home marks a significant and memorable milestone.
 
 And like most big achievements in life, we usually get there through thoughtful decisions and smart, strategic planning.
 
Here are our top tips.

Figure out how much money you realistically have
 
Most loan terms in Australia are generally 25 and 30 years. As a mortgage is likely to be one of the most significant debts you'll ever take on, it is important to look at your finances and be realistic about what you can afford to pay.
 
Interest rates may be low now, but they will go up in the lifetime of your loan, so be realistic about what you can afford to buy. Factor in life changes such as if you are planning to have kids soon, change careers, etc.
 
Set a limit for how much to spend on a new home
 
Knowing what your limits are when purchasing your first home will make all the difference when you are looking for the right property.
 
Set the limit and don't go over it when looking for your home, as you will only end up disappointed and frustrated if you keep looking for property that is outside your budget.
 
Upfront costs
 
You will need to take into account the upfront costs of purchasing your first home.
 
Such as:
 
Purchase price – this is the actual cost of the property. Unless you're able to pay for it outright, you'll generally need to take out a loan. Take note: lenders will typically ask for a minimum deposit of 10% to 20%.
 
Loan application fee – this is a one-off payment to your lender when your loan begins. Fees can vary depending on your provider and will cover things like credit checks, property appraisals and basic admin.
 
Lender’s mortgage insurance – if you have a deposit that's less than 20%, you may be required to pay the lender's mortgage insurance, which exists to protect your lender in the instance you're unable to repay your loan.
 
Government fees - stamp duty is a land/property transfer tax applied by all Australian state and territory governments, which can vary depending on where your future home is located. Mortgage registration and transfer fees also apply and differ from state to state.
 
Legal and conveyancing fees – these cover the services of a real estate conveyancer or solicitor, who’ll prepare the necessary paperwork and conduct the settlement process.
 
Building, pest and strata inspections – paying for these services will help ensure that any structural concerns or maintenance and financial issues are sorted—saving you from potentially detrimental problems down the track.
 
Moving costs – this will come down to how much you do yourself, whether you rent a truck or hire professionals.
 
Ongoing costs
 
Loan repayments - what you pay back and how often you make repayments—can have a big impact on the time it takes to pay off your home loan.
 
Interest charges - you can generally choose a fixed or variable rate or a combination of the two.
 
Other ongoing expenses – owning a home might include strata fees for communal properties, council rates, utility costs, building and contents insurance, and things like home improvements.
 
Make sure the locations you're looking at stack up.
 
They say location is everything, which is especially true when it comes to making a smart financial decision on your home purchase.
 
To help you buy a home you love - and for the right price - consider: how much properties are going for in the suburbs you’re interested in how far you’re willing to live from family, friends and work whether there is off-street parking and local amenities, such as schools, shops and transport
 
Whether you’ll need to renovate and if you have the extra funds to do so if there is price growth potential in the suburbs, you're looking at if there are proposed developments in the area that could impact the value of your home
 
 
Find out whether you're eligible for financial assistance.
 
You may be eligible for a first homeowners grant or stamp duty concessions. Talk to your mortgage broker for more details.