'We made a few mistakes': What buying our first home has taught me

Buying your first home is a big step into the unknown.

It’s hard to explain that queasy feeling when you draw down a huge amount of debt and take a step into the rundown little home you’ve received in exchange.

That’s how it felt for us when we bought our first home in 2014.

In a matter of weeks we went from being baffled by a simple sale and purchase agreement to being schooled up on things like due diligence, LIMs and builder’s reports.

It was a bit of a rocky road and the property market at the time was a little hectic so we rushed things a bit, but we were lucky.

Of course we made quite a few mistakes – we were naive, in it alone and hindsight is a wondrous thing.

Location

It’s the one thing you can’t change so do lots of research and suss out the neighbourhood.

We’ve dealt with the police about six times in four years. We’ve reported assaults at our neighbours’ houses, had property stolen and had a team of police in our backyard at 2am looking for a fugitive.

We were so desperate to buy that we didn’t look into the crime rate in our area that closely or chat to the neighbours.

But next time we buy, I’m going to study the area and make sure it’s where I’d like my kids to go to school and grow up.

Do your research but don’t procrastinate

We lost a few really awesome houses because we dragged our feet.

The thought of such a massive loan was hard to digest, even after the bank gave us our approval so we often took a step back when we should have been signing on the dotted line.

Think about what you want

Sounds simple enough. But think about what you really want and what you might want in five years’ time too.

We bought a small two bedroom do-up thinking we could upgrade when the time was right but buying and selling a house costs a lot and every time you do that, you lose a bit to the real estate agents and bank.

Think about your future and don’t over commit but definitely don’t under commit like we did.

Prepare to lose your weekends to renovations and maintenance

For our second home, I want astroturf everywhere so we never have to mow a lawn again and everything in the house needs to be already completed.

A do-up sounded romantic back then but it eats up your leisure time.

If you are happy with that, then a do-up is definitely rewarding but it’s hard and dusty labour. There are plenty of liveable houses out there where someone else has done all the hard work already.

Budget for more than just repayments

Rates, maintenance, insurances and renovations will eat up your income too.

Before we bought a house I had no idea how much maintaining they needed. Plumbing, wiring, landscaping, gutters, drainage, flooded basements, fencing, I could go on and on.

On top of that, our rates have gone up quite a bit in a short time and we’ve renovated a lot, albeit on a very tight budget.

Make sure you leave yourself wiggle room

Mortgage advisor Lindsay Hill specialises in first home buyers and gave his top tips:

Be wise financially: When arranging finance a better question to “what will the bank lend me?” is “what can I afford?” – there can often be a large difference between these two figures.

Don’t overstretch: Remember your first home is not your forever home so it doesn’t have to be the best house on the best street.

Seek advice: If you haven’t purchased a home before the more advice you can get the easier it will be for you – chat to friends and family that have purchased a home, get a decent mortgage adviser on board and a decent solicitor.

Be wary of do-ups: Buying a property that you can add value to is a great way increase your equity position but renovation projects can often cost more than you expect so properties that only need cosmetic renovations compared to properties that have larger and more structural issues are a better choice.

Fix build costs: If you want to build a property for your first home make sure you’ve got a reputable builder with full fixed price build contracts in place – if your build contract has too many “provisional sums” where the builder hasn’t fixed the cost it can often result in a end build price higher than expected.

– This originally appeared on Stuff