If you’re (you are) a first-time home buyer, you could potentially find the whole process very overwhelming. What do you need to know about buying your first home? What are the first-time home buyer incentives available to you? In this blog post, we’ll (we will) cover all these questions and more providing a handy guide for first home buyers.

What Can You Afford?

If you’re not already using a household budget, then it’s going to be hard to work out what kind of repayments you can afford, or how quickly you’ll be able to save up a deposit when buying your first home. If you haven’t used a budget before, now is the best time to begin. Work out how much money you can borrow, and how that figure might be altered by different interest rates. A first-time home buyer will also need to factor in additional costs such as stamp duty, conveyancing and property(building) inspection fees.

Are There Any First Time Home Buyer Incentives for Me?

You may be eligible for a range of first-time home buyer incentives such as the First Home Owner Grant (FHOG), a Stamp Duty exemption or concession, or the Principal Place of Residence (PPR) Concession. If you’re in the defence force, you may be eligible for the Defence Home Ownership Assistance Scheme (DHOAS). For a full list of first-time buyer incentives in Victoria, visit the State Revenue Office website.

How Much Do I Need for a Deposit?

When buying your first home, it’s ideal to save up at least 20% of the purchase price of the property. This is because if you save less, you will need to pay the lender’s mortgage insurance which you will want to avoid as it is an extra cost. When you have your budget in place you will discover that it is actually a friendly and practical tool. You will be amazed at how much more clarity and power you have over your spending thus allowing you to target specific areas that makes saving to reach your goal a whole lot easier.

Do I Need to Do Any Research?

In order to do your due diligence, you will need to get stuck into some research. For example, you can check the weekly auction results. You can go to public auctions and find out how much the difference there is between the advertised price and the eventual selling price. Are private sales likely to be an alternative in the area where you want to buy or is it more usual that you will be bidding at an auction? You will need to prepare for whichever eventuality is most likely, and you will need to know what your responsibilities and rights are in either situation for the best outcome.

What Service Providers will I Need?

As a first-time home buyer, you can’t (cannot) do everything yourself. You will need certain service providers to help you with various parts of the transaction when buying your first home. For example, you may need a buyer’s agent, mortgage broker or financial adviser, as well as a legal represent (such as solicitor or conveyancer) You will need to find out what particular loan to get, taking into account interest rates and lenders fees. You may also need to get the home looked over by building and/or pest inspectors.

Is a Pre-Approved Loan Important?

When you’re buying your first home at an auction, you will need organise a pre-approved loan from your bank as sale at an auction cannot be subject to your finance coming through at a later date. Therefore, applying for a pre-approved loan is very important.

Need Help with Buying Your First Home?

If you need help with buying your first home do not panic. Aumeca Group has been helping our clients successfully buy their dream homes for many years. We have all the knowledge you need to reel in the home you have got your eye on in the area you desire. If you’re a first-time home buyer and have questions for us, give us a call on (03) 8609 9086.