Sydney has one of the fastest moving property markets in the world and it’s easy to get left behind, especially if you’re buying your first home. While it might be overwhelming getting started, we have the insider knowledge to make your journey as smooth as possible.
1. Know your limits.
We know it can be easy to make an emotional decision when you’re trying to put your best foot forward and come up with a final figure to make or break the deal. This is why it’s so important to understand your limits. It isn’t just about knowing how much money you can borrow, you also need to take into consideration the additional costs that can be forgotten in the heat of an auction; stamp duty, solicitor fees, renovations and moving expenses can quickly add up.
Setting a budget holistically means less financial surprises down the track; you can calculate the maximum figure you’re willing to put on a contract and if you stick to it, move forward comfortably with buying a first home.
Director's tip: Adrian Tsavalas recommends setting both an ideal and a maximum spend the evening before an auction; this is key to avoiding any possible complications. He also recommends that you never bid or offer above your pre-approval.
2. Know what you’re looking for.
Sydney is a dynamic city with 658 suburbs from the CBD to the fringes. Before you start aimlessly scrolling through listings, make sure you know where you want to live and what to expect both financially and practically. Make a list of what’s important to you, from nearby infrastructure and school catchment areas to work and family proximity. When you know where to look, it will be easier to know what you’re looking for.
Do you need a house, or would you consider an apartment? Is parking a must? Do you need a big kitchen or a second bathroom? What are you willing to compromise on? Would you buy on a main road if the price is right, or settle for street parking if you love the home? Narrowing down your criteria will help put the right listings in front of you and eliminate weekends spent going from one unsuitable property to the next.
Director's tip: William Pereira recommends making the sold section on your portal of choice your best friend; understand recent sale activity in your chosen area instead of relying on price guides provided by agents.
3. Read the reports.
If you’ve been researching home buying tips, this is one you might not have come across in any guide to buying a house, but it is perhaps the most important. Buying your first home is a vulnerable process and there are people who will take advantage of your inexperience. That’s why it’s imperative to obtain property reports for any prospective purchases.
If you’re interested in a house, a Building and Pest Inspection will provide you with information on the structural integrity of the dwelling, along with any minor or major defects, pest activity or damp issues determined by an independent and qualified professional. Similarly, apartment hunters considering a strata-title property should obtain a strata report, which will evaluate the Owners Corporation records and keep you informed on voting rights within the cooperation, structural defects, major works, levies, the sinking fund forecast and a number of other important things. Although these reports oftentimes incur a small cost, they can save you thousands in the long run and help you make the right decision on your first home; it’s always a good idea to run these by your solicitor and discuss any concerns with the listing agent or inspector.
4. Research government initiatives
If you’re buying a property for the first time in Australia, you may be eligible for one of the government initiatives set up to help first home buyers crack into the market. The First Home Owner’s Grant is a $10,000 handout for individuals buying or building a first home and can be arranged through the bank financing your mortgage.
Similarly, the First Home Buyer Assistance Scheme (FHBAS) provides reductions and exemptions in transfer duty charges for eligible buyers. The First Home Buyer Choice Scheme is a recent initiative which will take effect from the beginning of next year; set to be a game-changer for NSW first home buyers, this new stamp duty legislation will allow buyers to choose between an annual property fee or a lump sum stamp duty payment. With new avenues of support being announced all the time, keep up to date with your options at www.nsw.gov.au.
5. Engage a good solicitor
When it comes to buying a first home, your solicitor will be your best friend – that’s why it’s important that you pick a good one. The real estate industry is highly regulated and the legal processes, as well as your rights, can be confusing sometimes. Engaging a trustworthy solicitor or conveyancer can help steer the process and ease any concerns that may arise.
Before bidding at auction or making an offer on a property, have a solicitor review the contract of sale; they will be able to pick up on any important details that you might have missed. They can also guide you in negotiating the deposit amount, the length of settlement, the cooling-off period, and any other special conditions that will impact your purchase.