Five tips for those buying their first home in 2015

It’s a new year and unsurprisingly home buyers are gearing up to get back into the market looking for a property to buy.

Here are five tips for all home buyers looking to get on the ladder this year.

Pre-approval

If you’ve stopped looking since the close of 2014 then you may be through, or close to, the end of your pre-approval period (or you may not have obtained one yet). While a pre-approval isn’t the same as an actual loan, it will give you the peace of mind to have a guide to what you can actually borrow.

Here’s a quick guide to home loan pre-approval. 

Ensure you can afford the repayments

Getting pre-approval for a loan is one thing, but are you sure you can actually afford to repay the amount required each fortnight or month? It’s critical to go through your finances, especially in the new year when changes may be planned, to consider whether different circumstances may lead to hardship later on. Be honest with yourself about your job plans and general stability. It may be worth practicing putting the money aside for repayments to ensure you have the discipline to pay back the loan.

To prepare yourself for debt, here are 10 things that you can do to make it easier.

Research

If "research" isn't a message that's drilled into you yet, then you may not quite be ready. Research is important! Understanding what properties are worth in the market you are considering, knowing how to negotiate with private treaty sales or the process for bidding at auction – all of this is critical if you want to purchase well.

You can read here the techniques that other buyers tend to use when researching property.

For those still looking for an area, the Finding section will come in handy.

Due diligence

Many of our top 10 first home buyer mistakes and how to avoid them are as a result of being rushed or not understanding what is considered due diligence.

Remember, you want to make sure that you purchase a property with open eyes, aware of the nature of the asset and ready for any necessary improvements.

Usually, there are three main things to consider: ensuring the home is structurally sound, undertaking the correct legal checks on the contract so you know what you’re buying and ensuring that you are able to pay a fair price.

If you’re not sure on what counts as due diligence, here’s a quick two minute explanation.

Know your limitations

Lastly, it’s something many of us are poor at – knowing our limitations. While,  it can be easy enough to determine your financial limitations after speaking to a broker, knowing your personal limitations can be harder.

Will you truly be able to commute that far?

Is renovating the home DIY-style really in your skillset?

Can you really put up with not having a car space?

Ask yourself the often uncomfortable questions to ensure that you’re not convincing yourself into the purchase.

What tips do you have for budding first home buyers?