Buying your first home: where do you start?

Buying your first home: where do you start?

We outline six steps worth taking in your home buying journey so you can purchase your first home with confidence.

For many people, buying their first home will be the biggest purchase they ever make. And knowing just where to start can feel a bit overwhelming.

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From scouring the internet to checking for pests, here are a few steps to take before you get the keys in your hands so you can buy your first home with confidence.

Research the market

First, ask yourself what you want to get out of buying real estate. Are you looking for a home in which to live or an investment property? This will help shape the type of research you’ll need to conduct. You’ll want to get an idea of where you’d like to buy, what the recent trends are in that area and what kind of place you could afford.

Figure out how much you can borrow

Your income and expenses will determine how much you can borrow to buy a property. Use our borrowing calculator to figure out roughly how much this is so you can begin to refine your search. It’s important to get a good idea of your borrowing power early on so you don’t waste time looking at properties that may not fit your budget.

Work out the finer details

There are more costs associated with home buying than just the deposit. Including things like stamp duty and pest inspections in your budgeting will prevent any nasty surprises later. And if it’s your first home, you may be eligible for the First Home Owner Grant or the First Home Loan Deposit Scheme.

Other things to consider at this stage are whether you will be required to take out Lenders’ Mortgage Insurance or have someone guarantee your loan. Both options come with some serious considerations.

Create a budget and set your saving goals

No matter what type of home you want to buy, you’ll need to save for a deposit. Start by putting together a budget to calculate how much you can save each month. Use our Savings Calculator to see how long it will take you to reach your goal.

It can be good motivation to achieve savings milestones along the way, so make sure your budget and goals are realistic. Opening a separate savings account can ensure your money is working hard and remove the temptation to spend.

Think about your home loan options

Just like homes, not all home loans are made equal. You’ll want to find the one that best suits you. You need to be sure you can afford the ongoing mortgage repayments – as a guide, ideally these shouldn’t exceed 30% of your after-tax salary.

Depending on your circumstances, a fixed or variable interest rate or a mixture of both may work best. A lending specialist can explain the differences and help you identify what’s important to you. Once you’re ready, look at getting conditional pre-approval so that you can act with confidence when you find the right property.

Find your new home

Once you have everything in place, it’s time to step your search up. Monitor the market closely and look at a range of different properties so you can get a solid understanding of what is good value and why.

The moment you find your dream place you’re going to want to act quickly, so it’s a good idea to have a solicitor or conveyancer on hand to contact when needed.

When you’re ready to buy, apply for a home loan and lock down the sale.

We’re here to help

Get guidance from start to finish on your home buying journey with the support of one of our expert lenders. We’ve also created a four-part webinar series to support you as you get started on your property journey, find the right property and buy your first home.