When you buy a house, you are in it for the long haul. This is why it’s important to go through your finances so that you can understand what you have to sacrifice. You will also have to make sure the property is truly suitable for you.
This article will explore several key steps that you have to consider when thinking of Buying a House in Australia.
1. Make Sure You’re up for It
The first question when it comes to buying a house in Australia: are you ready?
Having a house is a huge responsibility, both financially and personally. Are you ready to spend the next decade or so repaying mortgage loans?
You have to make sure that you’ve got enough savings to remain financially stable after you buy a house. You also have to leave aside a sizable sum just for maintenance costs.
Not to mention, you’ll have to decide whether you truly want to stay put where you are, or if you still feel like you may want to live in another city or even another country. Buying a house is an investment, and it’s a choice that you’ll have to stick with for quite a long period of time.
2. Evaluate Your Budget and Finances
Once you’ve decided that buying a house is truly for you, evaluate your budget by going through your accumulated savings and your after-tax income. If you are married, you can also include your spouse’s after-tax income into your considerations.
Consider that you will not be able to put all of your income into paying off the house. You will also have to factor in the average amount you will spend every month or so, and see whether you will have enough for certain repayment plans.
You will have to make sacrifices with your spending, so Settling on a Budget that gives you enough to spend repaying your loans and maintenance costs will be a good start.
It’s important that you don’t overshoot and go for a house that you won’t be able to repay in a given amount of time. This will cause a huge financial burden for you and will impact your mental health as well.
3. Go Through Different Mortgages and Interest Rates
Not all mortgage loans are equal. Some of them have low-interest rates, which makes the long-term repayment process easier for you. On the other hand, some of the loans have high-interest rates and may cause you more financial difficulties in the future.
Make sure you shop around for different mortgages before settling on the one you want. When going into an agreement, make sure you consider the factors such as the interest rates, the loan term (usually between 25 to 30 years), the ability to redraw funds and the exact repayment conditions.
You will usually have an option between a fixed and a variable interest rate. A fixed interest rate is suitable so that you can understand how much you have to pay in the future, and include this in your budgeting. A variable interest rate can be beneficial if interest rates are falling while you repay your loan
4. Choose the Right Location
It’s not enough to look at a house based on how it’s built and what it offers – you also have to consider what it is surrounded with. For instance, if you choose a house that is very beautiful but is in the middle of nowhere, you will live every day struggling to commute or reach entertainment centres.
These are a few factors you will have to consider in your buying a house checklist:
- Access to public transport
- Access to shops, services and centres
- Proximity to friends, family, or school
- Proximity to workplace
Whether the surrounding community is suitable for you
It’s always a good idea to take a look around the neighbourhood before settling on it. This gives you an accurate depiction of what will be accessible to you.
5. Choose a Real Estate Agent or a Buying Agent
Once you’ve more or less settled on an ideal location, you can contact local real estate agents to find out what’s on sale and what steps you have to take to find the most suitable property.
Alternatively, you can also find a buyer’s agent if you want to purchase a property from an auction, although they can also find suitable properties for you personally.
Having an agent working on your behalf is highly beneficial because they will be able to vet the property, let you know how much something is worth, and provide advice for finding a suitable deal for you.
6. Inspect the Property Thoroughly
Once you have found a house that appeals to you, make sure you go through a Thorough Inspection. Buying a house is a big investment, and you want to make sure the property is of good quality so you don’t have to spend a lot on repair jobs.
These are some things you should look out for:
- Whether there is mould
- The condition of the floors, doors and windows
- The condition of the walls and the ceiling
- Check the roof, guttering and drains
- Check the hot water system
- Make sure the plumbing has no issue.
You can also make sure that the neighbourhood is suitable for you. Can you truly see yourself living there?
Buying a House in Australia
Overall, buying a house in Australia is a big step, and it requires a lot of planning. You will have to make sure that you’re ready for the commitment, and that you have enough finances to ride it out. You will also have to make sure the property’s location and physical condition are to your liking.
Contact us today for more advice on how to buy your dream house.