Buying your first property is not like buying designer clothes, a holiday or even a new car.
You will most likely own it for a while and it is a substantial expense.
Entering the property market can be daunting and scary, when it should be an exciting time in any person's life.
Cohen Handler is a property buyers agency. They represent only the buyer in the real estate process. 'Our concept was born to take care of the buyer in the whole real estate process. We look after people who are time poor, get frustrated or are confused with the whole property buying process", said Ben Handler, Founder, Cohen Handler.
Ben Handler has some simple tips though for people who are first home buyers:
Don't rush- spend some time researching the area you would like to live in. This will allow you to properly understand value, what you should be paying and more importantly what you shouldn't be paying. Even go to some auctions to get a proper feel of the market.
Be wary of hooks- If a home is listed at $500k it's often just a hook to get people interested. Generally the real estate agent will want to sell it for an extra $100k. If your budget is around the $500k mark, look at places well below this.
What are your must haves?- If you definitely want a car space, don't let a real estate agent talk you into a place without a car space. Don't settle unless you really have no choice or the opportunity is so great.
Budget outside the actual purchase- you need to budget for expenses outside of buying your apartment or house. Make sure you have allocated money to obtain a strata report (around $300), money for a lawyer to read the strata report (around $500) and money for a lawyer to write your contract agreement (around $1500).
Due diligence- Get a strata report if buying because you must know if there are maintenance issues on the building which could cost you an extra $50,000. This is exactly the same with building and pest inspections. You need to know just how stable your potential new home is.
Which consultants to use- Understand the difference between a property conveyancer, a solicitor and why you might use a mortgage broker rather than getting a bank loan. Again, don't settle for the first mortgage rate; go out and see who is offering the best deal and service.
Don't judge a book by its cover- Make sure you actually go inside a property even if it looks bad from the outside. What's inside is more important that what's outside, because once you are inside you can't even see outside.
Make sure you remember something called -stamp duty' also. This is a compulsory tax for when you purchase property which is calculated by applying a sliding scale of taxation, depending on the value of your property. The general rule is that the cheaper the property, the less tax will be paid.
Make buying your first property an enjoyable experience. Follow these tips and you will be on your way to your first home.
'One extra secret tip is always wear a poker face. Never show your enthusiasm when you like a property. A real estate agent thrives on emotion and uses this as leverage to increase the price", concluded Handler.