The Checklist all Homebuyers must read!
It’s not uncommon for Australians to buy a property and later end up realising it wasn’t the best deal possible. The best thing you can do to avoid being in that situation is work through a checklist in advance.
Below is a useful start:
Research. Always look around for the perfect home suited to your needs. Purchasing a recently renovated property for a high cost isn’t always a good investment due to the lack of potential to add further value to build equity. On the other hand, you could have the same happening in inverse where you pay high costs for a house in its original condition, only to end up realising you could have purchased a house of the same sort that was fully renovated. Only you can accurately assess what type of property is best suited to your goals. Seek expert advice and be absolutely sure of the sort of property you want to get.
Budgeting. It is wise to sit down with a lender and determine your borrowing capacity. This is a good place to start as it gives you the boundaries of what you can afford to pay for a prospective investment property. Emotions can run high at auctions, getting a pre-approval from your lender is vital to determining your borrowing limits. Remember to check your eligibility for First Home Owner Grant Scheme (FHOG) which is a government-funded scheme that provides a non-means tested payment of $7,000.
Goals. It is vital to consider the minimum acceptable return you will accept from the purchase of your investment property. Ask yourself if you are planning to negatively gear this investment for tax benefits or if you are speculating that the property in a particular area will rise in the next couple of years. If your determination is that it will, then it is equally important to consider how much it will rise by. These are the serious questions that any would-be property investor must ask themselves before deciding to invest.
Costs. Inspection reports, depreciation schedules, stamp duty, general maintenance, property management fees – the associated costs can sometimes be endless. It is absolutely crucial to factor in every last cent into your budget into your investment decision as it will truly determine what return you anticipate receiving.
Lender. Once you have done your research, put a budget in place, set your goals and determined the costs associated, the next and final step is to be sure which banking product with which particular lender you wish to proceed with. This is one of the most crucial steps as well, as you want to be happy with the deal you’re getting. Use SwitchMyLoan.com.au’s very powerful home loan comparison tool here that lets you compare the different loan products and select the one you like the best or phone us on 1300 307 155 and one of our Customer Service Specialists can guide you through the process.
Always remember, purchasing your first property can be massively rewarding given the investment opportunities it leads to once you enter the market. But it isn’t something that should be taken lightly. Invest your time and some thought into your investment and maximise your returns.
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