As a new home owner, you may be asked by friends and family interested in buying their first home what to consider before diving in.
Here are five tips you can pass on.
- Is it the right time
Moving house can be stressful and time-consuming, so consider whether it’s suitable right now. Will your children need to move school? Are there work obligations that could make a move challenging? If you’re planning major life changes like having a baby, you’ll need to factor these in.
- Am I ready?
When considering your financial situation, do you have debts (like a personal loan) that you’ll need to manage? Perhaps you can consolidate these into your home loan, or pay off the credit card first. You’ll need to ensure your deposit is big enough to both purchase your new home and cover the costs of buying.
- How much money do I need?
While the purchase price of your home will be your biggest cost, there are other expenses to pay. Some other costs include stamp duty, home owner’s insurance, legal fees and removalists.
- Can I afford the repayments?
Determine what you can afford by taking your income and deducting regular expenses. Add home-ownership expenses, like rates, and allow for some unexpected costs. Once you understand how much you can afford, work out how much you can borrow using an affordability calculator.
- Are there any grants that I can access?
The government’s First Home Owner Grant (FHOG) scheme may provide a grant to first-home owners who meet certain criteria. Depending on which state or territory you’re in, and if you’re building your home, there may also be subsidies or tax exemptions available.