As a first home buyer, you have a lot of research to do on your journey to homeownership. Some things can only be learned through experience, but it doesn’t always have to be your own! Let the wisdom of previous first home buyers help you avoid some common missteps.
Here are our top 4 mistakes to avoid when buying your first home:
1. Going with your bank for a mortgage “just because”
Lending criteria differ among banks, and while your bank may have been great thus far in your life, it’s best to also turn to an independent mortgage broker at this stage for comparison. They will work to understand your situation and then analyse available loan options from banks and independent lenders to find the best offer for you in terms of interest and loan repayments. The good thing is that these brokers are paid by the bank you get your loan from, so it won’t add to your costs of buying a home.
2. Not getting pre-approval
Once you decide which bank you will get your home loan from, it’s a good idea to obtain a pre-approval letter before you start seriously house hunting. This is important, as you can use the amount for which you’ve been pre-approved to draw up your budget. It also helps when you do find a place you’re interested in, as a pre-approval letter gives the seller confidence that the sale won’t fall through.
3. Overlooking other costs
Speaking of budgets; it’s important to think of the other costs associated with homeownership, beyond your mortgage repayments. Factor in things like home and contents insurance, council rates, and other expenses you may have so that you’ll have a some money left over for fun (or an emergency).
4. Not considering all available resources
The First Home Grant is a financial aid that many first home buyers in NZ may be eligible for. The grant is a maximum of $5,000 for an existing home, but this amount doubles if you are buying a new property which is great news if you are considering one of our new builds!
Another route sometimes overlooked is the option of buying a house with KiwiSaver! When you have been a KiwiSaver member for 3 years, you can put your KiwiSaver funds towards a deposit or use the funds on settlement day. Click here for more information on the First Home Grant & KiwiSaver
Find your first home with Solution Street
Solution Street create affordable home solutions in Auckland with first home buyers in mind. We have a dedicated team who can help you navigate the path to homeownership, including advice on buying with KiwiSaver.
Is it time to find a place of your own? Get in touch with us today