Things to Consider When Buying a HomeJune 07 2021
Buying a home is a big step whether it’s your first home, next home or an investment property. At Abodable, we aim to make it easier for you. Our rebate makes buying a home more affordable and accessible, but there are a whole range of considerations you need to think about before taking the leap to buy a property..
Let’s cut to the chase and talk about money. There are a range of financial considerations to take into account when it comes to buying a home. Things such as how much you have saved, how much you can borrow and what grants are available to you. All of these factors will come into play when determining your budget for a new house.
How much you can save
This is a big one. When you start saving for a house, it can be easy to overestimate or underestimate how quickly you can save. Aside from your income, you will also need to consider your general life expenses before determining the amount you can be putting towards saving for your house deposit. If you are in a couple it will likely take you less time to save a deposit as you have two contributing incomes, but have a discussion around whether you will be contributing equally, or whether this will depend on your individual income levels. A good option when saving for a house deposit is to work out how much you can contribute towards your house deposit each week and commit to transferring that amount to your savings account. You may wish to do this weekly, fortnightly or monthly to align with when you are paid.
One of the huge benefits of Abodable is that you can use your rebate amount to contribute towards your house deposit. Our average rebate is $23,500 so this will cut months or even years off your savings schedule!
How much you can borrow
The amount you can borrow from the bank will depend on a range of factors. Each bank will have its own criteria, but they will typically look at your income, house deposit, additional savings and your credit score. It’s a good idea to prepare to borrow more than what you need so you can get approval. If you receive approval for a higher amount, this gives you a bit of wiggle room when it comes to putting offers on a place.
How much you can afford to pay back
It’s not just about what you can save, but more importantly what you can pay back. A bank wants to know that you are able to pay back the amount they loan you, otherwise they won’t give you approval. Remember to also take into account any stamp duty, body corporate fees and insurance that you will need to pay as well as your general day to day expenses and other bills.
In Australia, there are a number of home owner grants available. The grants and eligibility may vary from state to state, so it’s best to check out your state government website. As an example, some of the grants available in QLD are First Home Owners grant, Home Builder grant and the Regional home building boost grant. Understanding what grants are available to you is important as you may be able to use this amount towards your house deposit.
Buying to live vs buying to invest
Another factor to consider when buying a new home is whether you are planning to live in the house yourself, or if you plan to use it as an investment property and rent it out.
Buying to live
If you’re buying a property to live in it, you want something that feels like your home. Consider your own needs and wants. For example, are you prepared to do work on the house? Do you want to spend your weekends in the garden or would you prefer a low-maintenance property? How many bedrooms do you need? Do you need separate living areas? Would you prefer a house or are you happy with an apartment or townhouse?
n terms of location, consider how long your commute to work will be? Do you want to live near a town centre or are you happy to drive to the shops? Do you want to be near the beach, in the bush or in the city? Where do you spend most of your time on the weekends? It’s important you find a location that works for the lifestyle you want for yourself.
It really comes down to your individual needs as to what will work for you.
Buying to invest
When you’re buying to invest, the considerations are a bit different to buying a house for yourself. For a property that’s going to be rented out, you’re probably looking for a more low-maintenance option. For example, low maintenance gardens, no renovations required yet, surfaces that are less likely to stain. Think about your ideal tenants as this will help to determine the number of bedrooms required, living spaces, how big the outdoor living space needs to be.
In terms of location, think about areas that are in high demand. Potentially something that isn’t too remote, has good amenities nearby and will be able to facilitate a comfortable lifestyle for your tenants. If you’re looking for a family, consider the schools and parks in the area, as well as sporting facilities, shopping centres and other activities that may attract a potential tenant.
Buying property with Abodable
Buying a home is a daunting prospect, but with Abodable we make it easier. The Abodable rebate can make buying a home more accessible and help you start your new life as a homeowner. Check out our current properties here, or learn more about our rebate here.