Buying your first home can be one of life’s proudest moments. However, sometimes the journey isn’t a smooth one. Even for an experienced buyer, there are many pitfalls when buying a home. At Geelong Homes, we’ve put our heads together to come up with our top five tips to guide you through your new home journey.
First things first, do you buy or do you build? With all things, research pays off. And building a new home comes with lots of benefits.
For first home buyers building a new home, you’ll be eligible for a range of concessions that can save you money. You’ll also get a brand-new home with finishes and fixtures to the standard of quality that you require — this means less wear and tear, and less ongoing maintenance in the years to come!
It all seems pretty straightforward — but for some, it’s not so simple.
Tip 1// Don’t think bigger is better
You’ve visited the display homes and you’ve been tempted by all the pretty fixtures, fittings and upgrades. But there’s no need to stretch your budget to uncomfortable highs because bigger options beckon. Purchasing a four-bedroom home because it has better resale value, doesn’t make sense if it means you’ll be compromising your standard of living for years to come as you struggle to keep up with the mortgage repayments.
We like to remind clients that if a comfortable three-bedroom home suits you and your circumstances now and into the next few years — there’s no point anticipating what MIGHT suit you beyond that. If your lifestyle changes in the future, you can reassess your living arrangements then. In fact, you may make a large tax-free profit on your first home that will make buying a larger home easier in the future.
Looking at your new home in this way will help you to stick to your budget and the difference could be hundreds of dollars in your pocket every week for the next 25 years.
Tip 2// Read the fine print
For Geelong Homes, we are upfront with all the costs and inclusions right from the very start — before you sign the dotted line and put down your deposit. We like to think of our process like an open book. But it pays to take a closer look at all the details when you start talking to builders. We advise that you don’t choose a builder based on its display homes. All display homes include luxe upgrades that try to help you fall in love with the design. All builders have a range of designs to choose from and work with — so don’t be too hasty in choosing a design based on a display — a home that’s better suited to you might be there, you just need to do some extra research!
Tip 3// Understand the quality of the “builders range” inclusions
Builders will always tell you what is included in the build of your new home, but not all builders tell you about the quality of those products. Generally, you will make a selection from the “builders range” of items, but often that means the cheapest products that are on offer. Down the track, putting the lowest quality products in your home can lead to you replacing your carpets or fixtures due to general wear and tear after only a few years. It is also worth bearing in mind that the warranty NEVER covers normal wear and tear — so if a lower-quality product wears out — the builder won’t be replacing it for you. At Geelong Homes, even our standard inclusions are quality products that will last for years to come.
Tip 4// Know the builder’s reputation
The simplest way to do your research into the reputation of a builder is by doing a quick Google search, that will uncover reviews that give you an insight into the builder. However, the very best way you can learn more about a builder is to find people who have built a home with that builder. Ask them all about their experience with the builder — how they communicated and whether they were upfront with their costs and inclusions. When building a home, you’ll want to know that your biggest investment is in safe hands.
Tip 5// Understand your finance options
Make sure before you embark on building your first home, you’ve done your research on all the financial options available to you. There are a number of schemes and concessions available for first home buyers.
From now until June 2021, first home owners will receive $20,000 for new homes in regional Victoria valued up to $750,000. As a first home buyer, you’re also entitled to a stamp duty exemption or concession depending on the value of your property.
In addition, when you buy a home-and-land package you can save on stamp duty through the State Government’s off-the-plan concession. This duty concession applies to off-the-plan property that’s either a house and land package or a refurbished lot.
You may also be eligible for the Federal Government’s First Home Super Saver Scheme (FHSS), which was introduced in 2017. The scheme allows first home buyers to make voluntary concessional and non-concessional contributions into their super fund that they can then release to help purchase their first home.
And starting from 1 January next year, the Federal Government’s First Home Loan Deposit Scheme will help eligible first home buyers purchase a house with a deposit as low as 5 percent.
It’s also important to find a good mortgage broker who has access to many different products and can find you the best possible rate available to you.
If you find the entire process confusing, find a trusted family member or friend who can help guide you through this process. You don’t need to agree to anything unless you’re 100 percent confident in your decision.
Building a home can be one of life’s most fulfilling achievements, however we understand that it can seem daunting, especially if you’re a first home buyer.
By being aware of the common mistakes and arming yourself with advice to avoid those pitfalls the experience can be seamless and enjoyable.
Things to keep in mind when building a home are:
- Don’t be tempted into thinking a bigger home is better. Don’t get yourself into unnecessary financial hardship because you’re anticipating what you MIGHT need in the future.
- Make sure you pay attention to the fine print and understand each cost and inclusion.
- Understand what products will be used in your new home, what level of quality they will be and what is covered by a warranty.
- Do your research into the reputation of your builder — make sure you find people who have built homes with them and ask those people about their experience.
- Understand the schemes and concessions available to you as a first home buyer, such as the first home owners grant.
- Find a good mortgage broker who has access to a range of products to ensure you get the best finance available. If you’re not confident in talking about finances, find a trusted relative or friend who can guide you through your options.
By following this advice, you will not only save money but have a fun, exciting time while you build your very first home.
Want to learn more? Visit any one of our display homes to speak to one of our friendly new home consultants.