5 WAYS FIRST HOME BUYERS CAN GET A LEG UP OVER COMPETITORS
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Posted on: 1 Aug 2018

5 WAYS FIRST HOME BUYERS CAN GET A LEG UP OVER COMPETITORS

Like all first times, buying your first home can be a daunting, intimidating and downright terrifying experience. 

It’s a minefield of unchartered territory, a library of unread books… and then there’s the competition.

Not only are you up against all the other many first time buyers trying their luck in an uncertain market – you’re bidding against a pack of punters who’ve done it numerous times before.

The buyers’ advocates, investors and property developers of this world are making life seem extra hard with their sharp suits and seemingly endless bouts of expertise on all things home-buying.

But here’s the thing – everything they know can be learned.

People’s Choice Credit Union spokesman Stuart Symons starts us off with the basics.

1. Work out how much you can actually borrow

One way to get rid of your competitors? Don’t run in their race.

Working out your price limit, and applying for pre-approval on your home loan can help narrow your property search to just the homes that you can actually afford, ruling out the ones you can’t.

Real estate agent

Knowing your limits can help you and the agents in your corner narrow your property search. Picture: Kate Hunter

“Knowing how much you can borrow settles one uncertainty in a first home buyer’s search, leaving more energy and time to devote to identifying that dream home,” Symons says.

“Also, pre-approval allows first home buyers to potentially negotiate a shorter settlement period for any purchase. If the vendor wants a quick sale and the first home buyer has most of the paperwork done for their finance, a lower sales price could be negotiated.”

2. Be clear about what you want & shout it from the rooftops

The general rule as a first time buyer is to know what kind of property you want and be proud of it: let your inner circle know about it, and importantly, let real estate agents know about it.

“Buyers with a very clear picture of what they want – rooms, land, location, nearby facilities, price – can focus their own time, but also that of agents. When something comes up, real estate agents should be able to call you directly with the opportunity, which will let you focus on developing other opportunities,” Symons says.

“Experienced real estate agents will often contact unsuccessful purchasers after a property is sold if a similar property comes up, so save agent mobile numbers so you know who they are when they call, and work more closely with them.”

Brunswick cottage

Being clear about your priorities will save you from investing time into the wrong property. Picture: realestate.com.au/buy

Consider asking agents in your preferred markets for a list of recent sales in the area, and making a note of agents who have sold similar properties. “Contact the agents, introduce yourself and explain exactly what you’re looking for, and request that they call you when something appropriate comes on the market,” Symons says.

“They will appreciate having an avid buyer and may actively look for suitable properties on your behalf.”

3. Inspect as many properties as you can

 

Open for inspection

Visiting as many properties as possible will help you define your priorities and get to know the market. Picture: Kate Hunter

This is age-old advice, but sage advice nonetheless; it’s highly unlikely you’re going to purchase your first property on your first bid.

“You need to understand the market, negotiation tactics, competition and your own limits,” Symons says. “There are usually developed through experience: inspecting properties, talking with agents, and meeting those same agents multiple times across different properties.”

4. Be consistent with your savings

If you keep throwing your savings and budgeting off course, there’s a domino effect.

The whole property search will come undone when you lose sight of your savings strategy, so consistency is key.

Melburnians drinking coffee

Don’t try to save everything at once – consistency is key. Picture: Kate Hunter

“You may experience some bumps from time to time, but developing a consistent savings strategy backed by a fair budget will lead to better results over the long term,” Symons says.

“Try downloading a budgeting and expenses app to understand and control your spending, and stick to it. The better apps will help you understand where your money is going and develop a budget to keep to. This discipline will carry through to owning and maintaining a home, and then upgrading.

“Some apps will allow you to ’round up’ your expenses and transfer the additional amount to savings. If you spend $18, it may round up to $20 and send $2 to your savings account. You may not miss the $2, but it will push along your total savings that much quicker with little effort on your part.”

5. Remember: You don’t NEED to buy, right now

Whether bidding at auction or dealing with pressure to make an offer privately – the best way to calm your nerves and build confidence is to remember: you don’t have to buy this home.

“At auctions, if no one bids and the property is passed in, you may avoid the competitive bidding and win the property at a more reasonable price,” Symons says.

When making an offer privately, it comes down to how much you’re prepared to spend and borrow – the ball’s in your court. “It may be exciting to be close to buying your own home, but overextending yourself will make the early years very difficult.”

Read the original article on Realestate.com.au