First Home Buyer

These days, a lot is said and written about the first home Buyer. Most lending institutions provide detailed information for the first home Buyer that practically take them every step of the way to purchasing their first home. That said, whilst the “journey” as such, for the first home buyer has been made a somewhat less complicated and perhaps daunting experience, there remains two critical factors in the entire first home buyer process where the responsibility squarely falls on the shoulders of the first home buyer. We will discuss these two factors later in the article.

Whilst it is vitally important that a first home buyer does thorough research and speaks to qualified people to assist them, they also need to remember that more often than not, what they read or what they are told will always be based on what they are perceived to want to hear. That is, rarely will the first home buyer be told that they cannot be helped or they are not ready to pursue their “dream” at this point in time. The first home buyer needs to be resolute and have the ability to “read between the lines.”

As mentioned earlier, the level of information provided to the first home buyer today has almost made the first home buyer journey from start to finish a mechanical process. With everything from setting your goals to contacting the electricity company, the first home buyer seems to only “tick” another box and the job is done…..or is it?

A message to all first home buyers, “above all, be diligent”. Yes, it is great to have all this information and advice at your fingertips; however, the first home buyer can fall into the trap of being too reliant on this type of information. The two critical factors that the first home buyer must take complete ownership of are;

1. Their choice of home and location

2. Their financial arrangements

Firstly, the first home buyer needs to remember that it is he or she that will be living in their choice of home and location and whilst it may be nice for family and friends to offer suggestions, that is where it should stay, simply a suggestion. Too often, a first home buyer can be influenced by suggestions to the point where they look back and are never really satisfied with their choice. Another player in this equation that the first home buyer needs to be assertive with is the real estate agent. Whilst he or she may appear to be the first home buyer’s best friend, in most cases they are simply after a quick sale and a first home buyer is potentially, an easy target for them.

When the first home buyer is arranging their finance, obviously they will be guided by qualified people in this field. Whilst this is the appropriate course of action for the first home buyer, they need to be mindful of the difference between being told by the lender or financial institution that they can afford the loan and their own calculations and measure of affordability. With a vast range of products now available to the first home buyer such as 100% lends or even up to 105%, the first home buyer needs to be aware of any pitfalls that could seriously impact on their ability to repay the loan, causing them a deal of stress and heartache. What the first home buyer should definitely consider is, have they have demonstrated the ability to save a deposit and what level of commitment they made to save it? If the first home buyer feels that they are comfortable with that level of commitment and can still maintain the lifestyle they have become accustomed to, then that would be a good measure of repayment commitment for their loan. Alternatively, if the first home buyer has not saved a deposit or one sufficient to allow them to borrow substantially less than 100% or 105% of the purchase amount, then how confident really is the first home buyer to suddenly commit to quite a substantial repayment each month?

All in all, the message to the first home buyer is definitely do your research and sums, take on board any qualified advice you receive, but most importantly, you, the first home buyer must be in control of all decisions made.