Owning a dream house is a dream for every young adult. Buying a new house can be a night mare. Either you are buying an established house or building a new one you must be physically, emotionally, socially and financially ready. Buying a house takes more than you just having the deposit or the money to buy but there are a lot of aspects that take place in the process that you need to be aware of. Buying a house is a big step and you do not want to live with regrets by not doing things right so do it right the first time and never get it wrong. Are you ready is the question I got asked when I first purchased my house which I thought I knew the answer but was difficult to answer. For first time buyers as you probably won’t be knowing what to expect. In this article, I will discuss some point checks that you can consider determining if you are ready or not.
First things first, you must know what you really want to get. Are you planning on buying a well-established house or buying some land? Know the area where you want to purchase the house and this includes doing a thorough research about the laws that apply to that certain place and other things like safety and remoteness. You must also know if you are planning to get a double storey a granny flat or a normal house as this will save a lot of time and money. This will also help in budgeting. You also need to understand the process that you need to go through so it is easier for you to get what you want without any delays and mishaps. Know how long it will take for the property to be ready for you to move in or utilise that will save you a lot of disappointment and will help you to plan.
The next step is having a budget of how much you will need for buying the property. Buying a big property is very different from buying any other commodity as it requires a lot of strategical thinking and organisation. List down your costs that are most likely to be incurred and in this cost, you should also include minor costs such as council fees and transport costs. Budget comes with finance, when you say you are ready you should have organised finance for buying. Organising finance involves making an intensive research on financial institutions and try to get the one with low interest rates. One should be careful of any fine prints and understand all terms and conditions when dealing with financial institutions. You might also consider saving up in advance for the deposit to lessen the amount of money that you need to repay.
If you have the finance part sorted the next question is are you physically and mentally ready. As said earlier buying a house needs a lot of dedication it is not only about you have the finance. You need to be there for everything to ensure smooth flow of everything. You should consider getting some time off to get on top of things and have a clear mind so you can make sound decisions about your future home.
Lastly, you should know where you are planning to get your services. Do a thorough research on companies that sell and get some reviews from other people, have at least three companies in mind. If you are certain and answered yes to these questions well, congratulations you are definitely ready to buy.
Buying or building house is an exciting and life time experience and a big deal for first time home owners as one mistake may leave you in debt for years. Due to the high costs of building and land most people in Australia rely on financing from banks and they repay the money through mortgage spread over years. These banks require one to pay a deposit and your deposit has a great influence on interest rates and time you must pay the money in. Saving up is never easy and requires self-discipline and other life alterations to be a success.
The first thing to do is to prepare a budget and stick to it. One mistake home buyers make is to underestimate the cost of purchase. They seldom consider other costs involved such as council fees and duty stamps. When budgeting you need to also include that. In setting up the budget you need to use the SMART goals. S being specific and this case is specifying the amount you need, M for measurable, A for achievable, R being realistic of course you can’t be planning to save what you do not even earn and last and most importantly T for timely and this implies specifying that time that you need to have saved the deposit in.
One should also consider paying off any existing debts and credit cards before starting to save so they can solely focus on that. SA good idea is to also include your partner in saving up and this will be achieved in a short time. Put money towards home deposit and open separate savings account for it. Here’s the government’s guide to budgeting.
Use your pay to save up, do not first spend then save the remainder but one can for example save about 10 percent of their pay cheque and use the 90 percent for other things. If it’s a strain getting a second a job and direct that pay towards saving up for the house. Some people even go to the extent of selling their unwanted things on forums such as EBay and this helps a lot as it also can allow you to rent a smaller house after clearing your things. Consider also renting out a room to someone that small amount that they pay bank it towards the home loan deposit.
Be smart with your money, appropriately use your funds. Eliminate luxuries and use the costs to fund your savings. Luxuries include holidays every now then and other things like alcohol. A friend of mine managed to save about 2000 in a year by cutting off alcohol. Consider cutting down on buy food at work and carry food from home and this can save you about 50 dollars a week. Also consider buying cheaper products wherever possible as long it does not compromise the quality of your life. Lastly and most importantly take advantage of first home owner concession from the Government that assist people in buying their first home in Australia.
When buying household property, it is usually best to get new ones as it is something cheap and short term use, but for a big property such as a house it may be difficult to decide. If considering to buy a house people need to weigh the advantages and disadvantages associated with it and I am going to outline these in this article.
Readily established houses are ready to move in there are no waiting periods, so it might be ideal for someone looking for instant accommodation solution compared to when one is building a new house which can take months or years for it to be liveable. Once the payment is in and the paperwork if finalised it is usually ready for moving in. It also saves a lot of time and hard work as all the building work is already done for you.
Buying an established house enables you to choose where you want to stay and there are higher chances that you can get houses close to the CBD or workplace compared to when building a new one. New stands are highly unlikely to be available in old suburbs hence buying an established house gives you a wide range of choices in terms of location. It also means buying an established neighbourhood with activities and services such as roads, shops and public transport around you and is often secure. Trees and gardens are also already established.
When you buy an established house, you know what you are getting and no other costs such as labour or transport costs will be incurred. You pay for what you see and the house is ready for you to move in. When buying a new house, the buyer also has a higher negotiating power compared to when building hence might be lucky to get a house for a very cheap price.
In every silver lining, there is a dark cloud. There are several disadvantages that buyers of established houses need to be aware. Already established houses are not flexible in terms of design and customizing the structure of the house which is offered in building a house. There is no chance to design or choose material wanted for the house. In older houses one might also unknowingly purchase a house with defects that will only come to light after a couple of months or years. In addition, most of the houses do not come with any warranty as it usually lasts for about 5 to 7 years. The buyer might then incur unforeseen costs for repair. This also proves that already established houses might be expensive to maintain and properties might have structural issues.
Furthermore, when purchasing an established house, it is highly unlikely to get exactly what you want as it is impossible for two people to think in the same manner. They often don’t meet the needs of the buyers as they are often old outdated houses that use old technology which may come with expenses such as high electricity bills.
Build or buy a house is the question that runs through an aspiring new home owner for months or years before they come to their final decision. Building a house has several pros and cons to be considered and weighed before one undertakes the project.
Firstly, when you build your house you get to build your dream home and not live in another person’s dream house. It allows you to design, customise and choose every detail of your house. No two minds think alike hence you will never be 100 percent satisfied by someone’s choice.
A new home builder can benefit from the building warranty which is usually about 5-7 years. I remember when our house had a major water leakage it was a stressful event but the problem was solved within a few days, under the warranty we managed to get our ceiling repaired free of charge. You also benefit as you get new premises and facilities that have full life span compared to used things. You also get to choose the type of material that you want for building and that is sustainable as some things are not visible for example nails but if not strong will have future effects. The Australia government also offers eligible first time home builders some sort of incentive. Nowadays it is easy to do your research, just look at the websites of builders around. For example, check out this builder website.
New homes are also much more energy efficient as modern technology is used for example installation of gas stoves hence this will reduce the electricity bill. Building a house may also be cheaper as one can shop around for cheaper materials at the time.
As people build more houses and the cities expand houses are being placed far from the CBD hence as a new home builder you won’t be able to get a place near the CBD. There are only limited places where one can choose from at a time. Building is not ideal for someone who has a preference of where they want to stay as choices are limited. It also not good for someone who wants to move in instantly as it may take a long time for the house to be constructed compared to built house where once the deal or paper work is done the new owner can move in.
When building a house costs are not fixed hence one may experience costs such as penalty fees from the builder, legal fees, extra materials and labour costs compared to a readily built houses where the final price is what only you are supposed to pay.