Ready for the commitment of buying your first property?

BEFORE you set your sights on buying the home of your dreams, it is important to establish whether you are ready to make such a big, ongoing financial commitment – in other words, is your income stable and sufficient to support a first-time bond?

If you are secure in your job and earn a regular monthly salary, you’ll have a fairly good idea of whether or not you can afford to buy a home.

However, if you are self-employed, your income may be unpredictable, making it more difficult to know for certain whether you are in a position to purchase.

SA Home Loans’ experienced bond consultants will help you to verify your financial standing, and calculate how big a home loan you can afford and qualify for.

Also important to bear in mind are the costs and fees associated with purchasing your new home.

You’ll need to have money saved to place a deposit on the home, and you’ll also have to consider moving costs, home-owners’ insurance and rates on your property.

To ensure that you can afford the purchase, it’s essential to calculate all your monthly expenses and those involved in buying your first home.

As a general rule, your bond repayments, together with taxes and property insurance, shouldn’t exceed 25% to 30% of your gross income.

In fact, at SA Home Loans, as a responsible lender, we will not approve a loan that exceeds 30% of your joint gross monthly income.

It’s also a good idea to try to pay off other debt you may have (such as personal loans or credit card debt) before applying for a home buyer mortgage.

One of the most crucial factors you’ll need to consider when buying your first home is the type of house you need.

While your first home may not be the mansion of your dreams, it is important to ensure that it meets all your current and medium-term needs.

For example, a seaside bachelor flat may be an idyllic pad for a newlywed couple, but will it be a practical place in which to raise a family?

When purchasing a property, it is vital to consider your individual housing needs, as well as those of your family – or future family!

Is the home centrally located, or at least within manageable distance of work, grocery stores, doctors, schools and pharmacies?

Most importantly, is the area relatively safe and secure?

Although you may get “more home” for your money in a less desirable part of your city or town, these may not be suitable areas for children to live and play in.

The value may also not appreciate as it will in more sought-after areas.

Once you’ve decided which area you’d like to live in and have a rough idea of the type of home you want to buy, you’re ready to begin house-hunting.

Although the process of finding a home is reputed to be a lengthy one, don’t be surprised if your ideal home takes only weeks to find.

Once you discover the home that’s right for you, it’s a good idea to snap it up and resist the urge to “shop around” for a bargain.

When you find the property that’s priced right and perfect for you, buy it.

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