How crazy is it to see how much the property prices have gone up since this time last year!
At the same time last year, 60 -70% of first home buyers were using their first home grant when purchasing their first home because it's common practice and it's there for the purpose of helping you buy.
However, we have been witnessing in our office for the last 6 months that 95% of first home buyers are choosing not to use their first home grant why? Because the chances of purchasing a decent home under $500k in this market is very hard given how unprecedented the property market is and continues to rapidly grow.
If you purchased a property last year you were extremely lucky, you purchased when properties were at an affordable price range. We are now seeing the same properties going through the roof.
In a situation where it is a highly competitive market, it's quite common for Real Estate agents to recommend making an unconditional offer or pre-auction offer. We always say although it sounds really good on paper, we recommend you complete all of your due diligence well and truly before. You never know you may require a registered valuation, or need to run the Sales and Purchase agreement past your Lawyer.
There are many different factors to consider before you move forward with this process. Make sure to get your ducks in a row, it gives you a strong advantage and can make things a lot less stressful.
In summary - prices are very strong, last year first home buyers were using their grant, now the market and homes are In high demand, so most first home buyers are forfeiting using it as purchase prices are at an all-time high. It’s easy to get caught up in needing to make an offer on this property, or thinking I'm going to miss out, but for first home buyers please take the time to do your homework and due diligence on the property before jumping head first.
We highly recommend If you are going to auction get the finance across the line first.
You may require a building report, or registered valuation before you bid.
If you have a 20% deposit it makes life way easier when we are approaching the bank, especially when getting you pre-approved.
5 things to know when you are looking to purchase your first home In a hot market!
- Make sure that your finance Is all approved prior to you making an offer on a property.
- Make sure you complete all of your due diligence.
- Make sure you understand the other associated costs you will need to pay when purchasing a home such as lawyer's costs, registered valuation, building report.
- Hardly anyone uses a buyer's agent but I always recommend it if you have a good Real Estate Agent who is happy to help buyers. The value they add is such a great thing to utilize, it's a free service and they know the market extremely well and can negotiate on your behalf to get the best result.
- Making sure that you have a plan In place to protect the mortgage ie, have life insurance cover in place, House and contents insurance to cover all bases in case something happened.
If you are unsure of the process and just don't know where to start, talk to professionals who are there for this exact purpose. It could mean the difference between buying your first home or missing out.