Often, prospective home buyers need some guidance as they navigate the road leading to home ownership. Whether you have experience in real estate in Perth and surrounding areas, or this purchase is your first home, you will find an authority explaining the steps of buying to be extremely helpful.
The professionals at Zest Realty have assisted hundreds of others looking to buy a home in Western Australia. The information in this guide will help as you purchase your home.
How to Purchase Your Home
Planning to buy real estate does not need to feel overwhelming. Prequalifying for a loan is an excellent way to get an edge on other buyers and reduce your stress.
1. Start With Your Budget
The easiest way to sort this out is to break it into a few more minor steps.
- The size of your deposit – The amount of your deposit typically goes hand in hand with the price of your home. Generally, you need a 20 per cent deposit. If you are borrowing more than 80 per cent of the home value, you will need to get Lender’s Mortgage Insurance, also called LMI. This is added to your loan, so your financial organisation is protected if you default on your home loan. Speaking with a loan professional early in the process can inform you about various programmes available to reduce the amount of the deposit required. When buying your first home, several options exist to reduce the deposit needed.
- Your borrowing capacity – Lenders are legally required to take steps to ensure you can afford the home you are buying. There are several factors used to determine your ability to repay the loan. These include your annual income and expenses, debt, credit history, and ability to pay the upfront costs of buying the home.
- How much debt you can comfortably manage – Numerous factors influence the level of debt that is right for you. Consulting with your broker can be helpful. They can assess your financial health and let you see the boundaries you should maintain.
- Upfront costs, such as due diligence and stamp duty – The upfront costs, not including LMI, run between 7% -11% of the total cost of your property.
After you set your budget, take some time to decide what your must-haves are. This will vary from person to person. You may insist upon a large garage and feel neutral about the number of bedrooms. Another person may feel the opposite way. You will need to choose locations you prefer and those you would rather avoid. Make sure the areas fit your lifestyle as well as other factors like public transportation and schools.
2. Purchasing Process
You know the details of what, where, and how much, and it is time to find the home of your dreams. Working with an experienced broker can make the house-hunting process easier than searching alone.
Be sure to attend open inspections of properties that interest you. Plan on bringing a checklist of important factors. Also, take plenty of pictures and notes regarding the good and bad aspects of the property. If a specific property stands out to you, attend several inspections and talk with the listing agent. The more information you have, the easier it will be to make a choice.
Once you are sure you have a home that meets your needs, you need to do your due diligence. This ensures you know about any problems and will not be blindsided by issues later. Several elements of due diligence are vital before you attempt to buy.
- Review the building report
- Hire a solicitor or conveyancer to review the purchase contract and building report
- Check the contract to see if any changes should be made
Work with your property professional to determine a fair offer and ask your agent to submit the offer in writing. You should include any stipulations you feel are necessary, as well as a deadline to accept or reject the offer.
Next, you will have a cooling off period (usually between two and five business days) so you can rethink your actions and terminate the contract if necessary.
3. Purchase Accepted
The transaction is complete after the buyer formally accepts your offer. Your next step will be waiting for settlement day. This is when the seller receives the money owed. Then, the property is legally transferred to the buyer, and the buyer gets the keys.
4. Time to Move in
All of your hard work and difficult choices pay off when you are moving into the house. Before move-in day, be sure to handle all practical details immediately. Switch utilities, ensure you have the appropriate insurance in place, and do any interior or exterior work needed.
Conclusion and Call to Action
The search for a home can be stressful and time-consuming. Buyers often encounter unexpected twists and turns along the journey. This is why working with a property professional is an excellent decision. As someone who has experienced the process numerous times, an agent is in an ideal location to protect your interests.
If you are looking for a home, consider contacting Zest Realty. Our team of experts can help you find the home of your dreams and ensure you are treated fairly throughout the purchasing process.