What should I look for when buying a house?
Buying a home, whether it is your first property, or your 5th, is no easy feat – there are a number of questions you should ask, and things to look out for. At Aframe we have compiled a guide for how to start you home buying process
What are the first steps I should take when looking to buy a new home?
When looking to buy your first or next home, the process can be daunting. Perhaps the easiest place to start is to choose a general area and start your research there. Even if the area you choose is reasonably broad this is a good starting point. An easy place to start if you are local is to take a drive. Make some notes on what you like or dislike about a neighborhood. Take note of public transport, local amenities, parks and schools, clubs and activities. All of these things can add up to make your living experience that much better.
Once you have decided on one or more areas, setup saved searches on trademe and other listing services and get notifications of new listings or regularly checkout what has been listed. Get a feel for the price point and number of listings. Some areas might see far less listings than others as streets and suburbs tend to go through cycles of home transactions.
Sign up to local real estate agents newsletters. You quite often will receive market summaries and updates. These market summarties can help you a lot when thinking about budget and costs as they are data driven and include market commentary from a local expert.
As you narrow down your preferred area, start to use your contacts to get first hand advice on the neighborhood. Do you know anyone who lives in the suburbs? Do any of your wider contacts know someone? What do they like or dislike? These first hand accounts can go a long way as they are objective and come from experience.
What do I need to think about when viewing a home?
When viewing a home, one of the single most important things to remember is not to get emotionally attached. Think objectively, think logically and decide on the price you are willing to pay. When you let yourself get emotionally attached to a home, you are far more likely to pay more than you wanted to or can afford.
When deciding on what open homes to go to, it’s reasonably important to make it to the first open home. Sometimes this can be mid-week and even very soon after the listing goes live. Making it to the first open home means you have more time to decide what your next move is. If you do miss the first open home, it can mean your timelines for due diligence are compressed and you may miss something.
Don’t be afraid to ask for private viewings. Real estate agents are quite often happy to accommodate viewing outside of the standard Sunday time slots. A private viewing also gives you more time with the agent to ask questions, get a true idea of the property and get any additional insight that may sway your decision.
Continue your objective observations throughout your viewing, making note of both positive and negative aspects of the home. You can then compare these with other properties you have viewed before making a decision and submitting an offer.
What questions should I ask the current homeowner or real estate agent when looking to buy a house?
In New Zealand, real estate agents are governed by the real estate act of 2008. This states that an agent must disclose any information they have about the property, and that the owner must disclose this information to the agent, no matter if this is detrimental to the sale price or not. Ask all the questions you can, being informed about the house you are looking to buy gives you the best chance to make the right decisions. Examples of questions you might like to ask are;
- What chattels does the house come with?
- What nearby sales have they used to come up with their price?
- What schools is the property zoned for?
- Have there been any maintenance issues?
- What are the rates and body corporate fees?
- Are there any restrictions on the title?
- Was this a rental property?
- Is there a builders report and LIM available?
What should I be doing about finances, mortgages and talking to my bank?
There are a few financial aspects you need to consider when searching for a new home.
It’s advisable to let your bank or mortgage broker know when you are looking to buy. To get pre-approval before you seriously consider making an offer is a must. In the fast moving New Zealand market, making an offer that is conditional on finance being approved, can mean the difference between having your offer accepted or not, even if your offer is higher.
Once you have this pre-approval, you will get an idea of what the bank will lend you. Sometimes this figure is more than you had anticipated or were willing to spend. Be careful to think through the amount you feel comfortable spending on a home and use repayment calculators to make sure you stay within your budget.
Along with this, it’s advisable to seriously evaluate your means. Particularly for first home buyers who often need to accept that your first home is rarely your dream home. More and more Kiwis are finding comfort in apartment or townhouse living [LINK] and as our cities continue to develop, this option becomes more viable.
When planning your budgets, be careful to not just think about mortgage and deposit amounts. With purchasing a home comes additional costs. Paying movers, lawyers, buying LIM reports and any immediate renovations required can quickly add up. You also have to factor in ongoing costs like rates and maintenance.
Are there any things I shouldn’t do before buying a house?
There are a few things you should not do before buying a house. In order to give yourself the best chance possible of securing your ideal home, try to avoid;
- Making large purchases. A bank will monitor your last 3 – 6 months of spending habits in order to assess lending. Large purchases could count against you.
- Avoid co-signing any other loans. A bank will view you as responsible for this debt.
- Don’t become fixated on one home, home type or location. Be flexible in your approach and be prepared to have offers rejected multiple times.
- Be aware that many people in your life will have an opinion on purchasing a home. It’s most important that you do what is right for you.
Online resources to help you with buying a home
Find your real estate agent with Aframe. If you are looking to sell your home, or just get the best advice on the current market situation, Aframe can find the best local agents to help you.