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THREE THINGS YOUNG FIRST HOME BUYERS NEED TO LOOK OUT FOR

16-Aug-2017

These days if you're buying a home in your twenties chances are you'll be smugly feeling like you're winning in life (even if you've had to cut back on your smashed avo brunches). But beware, there are a few mistakes young home buyers need to watch out for. 

Lessons learned: where some young first home buyers went wrong

Your emotions can put you wrong. Having spent most of her life living in an inner city townhouse, one young buyer romanticised the idea of country living, buying her own slice of paradise - not exactly in the country, but a suburban home set on almost an acre of land. She admits it was a big mistake! She travels a lot for work and simply couldn't keep up with the property maintenance. She later moved into an apartment, a much better fit for her lifestyle.

You might not be thinking about kids but potential buyers could be. When one young, single first home buyer bought his townhouse all he was interested in was securing an affordable mortgage and making sure his new abode was close to the city. He didn't check out the school zones, or even consider how attractive the home would be to a family. Later, when trying to sell, he realised he had bought in a less than ideal school zone and this made selling tough. He now knows he should have looked at the number of homes for sale in the area, and researched why people were moving out of the area - if he had done this he would have realised that school zoning was a real issue! It's always ideal to buy in areas that appeal to many and varied buyers, so you can sell quickly if needs be. 

Even the smartest budgeters need a big buffer. It's all well and good to make sure you can comfortably meet monthly mortgage repayments, but have you really taken all possible expenses into account? One first home buyer talks about diligently budgeting, saving and organising finances, but not realising until too late about all sorts of additional costs. He didn't consider the cost of breaking an existing rental lease, did a poor job of estimating moving costs and underestimated the costs of power, internet and the like (and moving in during winter when the power bill was at it's peak was particularly challenging). He also didn't allow for a nesting budget; for new furniture and homewares. He now knows that no matter how much you think you won't spend money on home decorating, you will - so you might as well budget for it. 

So, first home buyers, whatever you do, take the time to do plenty of research during the home buying process. Consider your lifestyle, where you want to be now, and where you want to be down the track. Most importantly, seek input from a financial adviser, we're here to help making first home purchases easy.