Buying any home at any time, no matter how many times you have done it, is always an emotional experience. If you’re in the marketplace now as a first-time buyer, then the stress factor can be even more significant. It’s not only as they may say in the novels, a romantic and adventurous leap into your future, and yes it’s is exciting, but it also involves making a decision that probably concerns one of the most important investments you’ll make in your lifetime.
In various respects, this first challenge can be the experience that opens doors of opportunity for you; depending on how you play the proverbial cards you are given. The decisions you make during this episode in your life will either see you gain in business and financial stature and confidence, or land you with a financial burden. Therefore, take some time to gain some knowledge about the market and the investment you are about to launch yourself into, especially concerning what you need when buying your new home, and what is involved in getting that all important mortgage? It could be the difference between having a winning hand and being just another loser in the property market stakes.
Property dream or a nightmare!
It is the desire or dream of most people to have their own home! However, despite this highly influencing factor, a primary question first-time home buyers should ask, is whether realistically owning your own home is logically and financially the right investment for your particular circumstances? Looking at the situation rationally and removing the romantic and ingrained influences of home ownership, it is not an ideal decision that benefits all people always!
Your next question will probably be something like, OK wise guy, so how do you make this crucial decision about a commitment that could significantly affect your life? Well, the first part of the answer is easy and it relates to affordability! Laying it on the line, it’s very easy to buy something on credit that is going to be used and paid for relatively quickly, but it’s another story when you need to commit to making payments for something that is going to take a significant number of years of your life.
Carrying on with the doom and gloom part, but without apologies for spoiling any moonlight and roses pictures you may have; we are living in volatile times and economies. There are many financial experts worldwide, who are basically making guesses about how things are going to be in the future! If you have a few million dollars in the bank, then fine; knock yourself out with a luxury condo, otherwise, look at any property investment logically and how it befits you!
The first-time buyer challenges
When you are a first-time buyer, you’re entering a world cluttered with real estate agents or realtors, depending on where you are located. Keep one thing at the forefront of your mind; their primary interest is in filling their bank accounts, not yours, or the sellers! Another crucial aspect you must consider is that this investment is not only about how much you wish to spend on your new home but the deposit sum you can initially put down. In addition, there are various and associated hidden costs that accrue with buying your new home. If you intend making some major renovations, then you can increase the cost by more than 15%, so be careful and get professional advice before signing anything! What you definitely need on the bottom line of your financial report is a healthy credit rating. In addition, your budget should be organized with a predetermined affordability regarding the deposit and any other financial commitments.
Where do you want to buy your new home?
This is naturally a critical decision with a variety of influencing factors associated with it, including available finance, which is usually determined by the amount of the deposit and mortgage obtainable. This can have an influence on your decision regarding the area in which you would like to purchase your home.
For the new homeowner, the excitement mounts when they find their ideal home at the right price and it’s now at a stage where an offer to purchase is presented to the owners by way of your realtor or estate agent. However, you must be completely satisfied that all your finances related to the purchase are in order and have been appropriately approved by any financial institution involved. You should now be in a strong position that can get your offer accepted by a seller, having discussed with your realtor or agent, the worth of the property to you, including fixtures and fittings.
When determining the offer, it’s wise to give yourself some financial room for negotiations, keeping in mind that the seller is primarily concerned with their interests in the transaction and not yours! If an agreement is reached with the seller, your realtor will; arrange all legal aspects related to the sale on your behalf.
Your estate agent will usually instruct a lawyer versed in conveyance procedures to act your behalf, regarding the legal aspects in transferring ownership of the property to you. As you should have had all financially related aspects in order before making an offer to the seller, you now only need to re-approach your mortgage company and present them with the accepted offer and the process will be completed. In the event of your finances not being in order, then you must rectify the situation with all possible speed, to prevent the seller losing patience. This is a crucial factor that applies if you are a new buyer or one who is selling a property and buying another.
Logic before emotion
Looking at this new property investment from another angle; presume you’re already a proud homeowner, but who is, however, for various reasons needing to determine whether it’s in your best interests to put your present home on the market and sell it before you invest in a new one? Although it involves some risk in a rising marketplace, there are positive factors associated with it. They include for example; an established negotiating scenario, with the advantage of being able to act quickly, by your having a readily available mortgage facility, in the event of your finding the ideal new home!
Other advantages include you being fully aware of the related market price structures, in which you can concentrate your search for the right property! Furthermore, and importantly, you can save not only your time but also that of a seller, which in turn provides significant motivation for a seller to consider accepting an extremely favourable offer. This article is designed to give potential new home buyers a few guidelines for their journey into the property market.
Best wishes and enjoy your new home; but, remember to remain aware during the buying process!