It’s every renter’s dream to own a house of their own, to be able to call the shots and put that exorbitant rent money right where they want it instead of into a landlord’s pocket! For those who are able to accrue the financial resources to make purchasing a house a reality, it is a dream come true, but it is still not something to be taken lightly, buying a home of one’s own is quite likely to be the biggest financial decision a person is liable to face in their lifetime!
Once you are one of those fortunate people who are ready to begin the process of buying a house in NSW it’s important to clarify your goals and set a realistic budget. It’s best to start the process by carefully reviewing your current financial situation, then think about exactly how much you might be willing, or able, to spend on the purchase.
It’s advisable to ask yourself some important questions in regard to precisely what reasons are compelling you to buy a house:
Do you want to leave an expensive rental arrangement?
Do you feel your current home is too small, or no longer suits your needs?
Do you think, on the other hand, that you might prefer a house that is smaller and easier to care for?
Whatever your reasons may be, having a firm understanding of them will aid you later on when it comes time to pick out the ideal house!
The next thing you have to take into consideration is the state of your finances. You will need to make a careful assessment of your income, expenses, savings, and borrowing ability. It is best for you to have 20% of your deposit held in reserve. You could just pay a 10% deposit, but then you will have the added expense of paying for LMI (lenders’ mortgage insurance). The amount you will be able to borrow doesn’t just depend on the amount of deposit you have set aside in reserve, but your general financial situation including income, total expenses, loan repayment history, and all other assets or debts you are carrying as well.
Once you have your finances sorted, it’s time to move on to what is arguably the exciting part of the process, finding the right house for you that fits within your budget! There are two issues that you will need to balance during this search, your list of “like to haves” and your list of “have to haves”. Carefully consider what features are in what category so you will have a firm idea of what your options going forward will be.
There will be some aspects of a house that will be plainly non-negotiable, your “have to haves” such as the size of the house, the layout of the house, and the location and local amenities. Your “like to haves” might include the house’s cosmetic design, the surrounding grounds, and the potential for future renovations and additions to take place.
Ideally, you will be able to find and purchase a house that is within your budget that embodies all of your “have to haves” and most of your “like to haves”!
