Buying a first home...hints and tips

[Lulu]

Check with your state government if you fall into a low income category, as some of them run subsidised loan schemes. My sister qualified for being a single parent, basically it's a reduced rate of interest and your repayments are tiered against your income, rather than against interest rates (this is in South Australia). Worth looking into IMO.

I worry about this - I'm not sure if it's exactly the same but this was done in Vic about 10 (?) years ago and ended in people never managing to make a dent in their debts and a huge class action against the govt.

[Lilly-Pilly]

Thanks for the imput so far. I don't think I'd ever go down the auction path, having said that, all this is just a thought process at the moment. Much more to learn and find out about.
What expenses are involved in buliding from scratch, as in before the actual house planning etc?
My plan at this stage is save more, then like Cammelot said, it would be a simple little place that can be done up over time to make me love it more, the nice newish place can wait for a while now!
Love to hear more from everyone

[Lulu]

I got hold of both my (cheap) little do-er uppers before they even got advertised. I visited all the RE's in the area and made it clear what I wanted and I got a couple of callbacks.

[fionas]

It's hard to get a bargain these days but ...

if you see something that's advertised for auction and the RE agent doesn't have many properties in that area/suburb then they could have picked up the client because they've offered them reduced fees - meaning the seller is wanting to save a dollar here and there so might be quite eager to sell. This particularly applies to deceased estates or where the seller is elderly and needs a deposit on a nursing home place. Often they are prepared to take an offer before auction on the basis of one in the hand is worth two in the bush and it can be way below what they would get at auction. DP's family did this when selling FIL's home and our next-door-neighbour also sold her house for what I (and her RE agent) both estimated to be at least $50K below what she would have got at auction.

You can generally tell if it's an older person's house by the style of furniture/decor.

[wysiwyg]

Is true mortgage insurance can be expensive but you also have to take into account the length of time it will take you to save up the extra deposit and what might happen to house prices in the meantime and the money you are paying out in rent etc. Often if you do the figures at the rate house prices are rising currently it works out better to say have a 10% deposit and pay mortgage insurance than spend another year renting to save the 20%.

Auctions are not always a bad thing particularly if you can be quite emotionally detached about a place so are not going to be pushed higher than you think is worth. The area I live in if wasn't prepared to go to auction would have reduced properties available by about 70%. Places do sell prior to auction occasionally, and often you can gleen info from an agent about why someone is selling and how likely they are to accept an offer prior to auction.

We were relatively new to Australia when we started looking to buy (a year or so here) so hadn't a clue really about how system worked over here and found this book which we got out the local library useful

The insiders guide to buying real estate [text] : by someone who buys real estate for a living / Patrick A. Bright.

Although this book does recommend seeing 100 properties before you start getting serious so you can get a good idea of the market and are able to value places quickly - so it ruined a fair few Saturdays for me - I think we had seen 92 when bought ours.

[Lulu]

I ALWAYS felt I was paying too much when I've bought...but have always been proved wrong in the long run .

It might also be a good idea to get an idea of how much some things can cost to replace - if you are looking for something that needs a bit of work you need a realistic idea of what that will mean.

[misty]

Research. Research. Research.

Know your area. know your budget. Know what your are and what you aren't willing to sacrifice (ie, needs v wants). Be willing to acept less then perfect (you can always upgrade later, you don't need the best straight away. Don't get to emotionally invested (extremely hard for some people), at the end of the day it is just a house, and there are others. You don't want to pay more then it is worth. Compare the asking price with the price of the other houses in the same area that have sold or are for sale - make sure the houses are comparable (ie, DLUG and 3bd +ensuite, compare against the same or similar).

Get yourself a good homeloan broker. Make sure you are aware of all the hidden extra costs (stamp duty, application fees, conveyencing fees, LMI, house and contents insurance, etc). You will need this on top of the deposit.

Good luck and have fun

[rubibaby]

Okay...here are a few suggestions. Firstly ask yourself where do you want to live and what do you want to live in. Do you want to live inner-city, coastal or rural? Do you want to live in a house, apartment, farm, etc?
Make a list of what is important to you - number of bedrooms, car access, land size, number of bathrooms - but be prepared to compromise on some things.
Are you willing to renovate? Renovating is very common in cities but it is expensive and a difficult task to do with children.
I'd recommend that you look for at least one special feature - view, large backyard, period feature.
A lot of these tips I've got from LJ Hooker Real Estate's guide to buying. It is a good read and full of info...good luck!
It is an exciting time...

[Floweryfields]

Can i ask a question too? If you are buying a rental property - and using the equity on your existing home - do you have to have a deposit?