How to: Buy a Home?

Saving money to purchase a major asset like a home, is no small feat. So, where do you start and how do you master the ‘saving’ gig?

We’ve all heard of those basic tips like, make a budget and don’t go out for dinners, but let’s be honest, who finds joy in the most mundane tips like those? We certainly don’t and with years of assisting property buyers under our belt, we know that we’re not alone, which is why we’ve put together some tips that are realistic and more exciting!

  • Make purchasing a home your main priority and don’t invest elsewhere, so that you can funnel all of your money into that one goal.
  • Spend proportionally on your income (i.e. no more than 10% on materialistic items).
  • Shop at a cheaper grocery store and try to always use all of your groceries, rather than throw any away.
  • Quit purchasing luxury items and delivery-based services like Uber Eats.
  • Decrease your smoking and alcohol intake.
  • If feasible, live with your parents and/or family to try and save on some living expenses.
  • Clean out your wardrobe and sell any quality, unused items.

Whilst it’s essential to save for your house deposit, it’s important to know what else you need to save for and to better understand what’s involved in the whole process.

Here’s our collection of all you’ll need to save for, when it comes to buying a home.

Your Deposit

Starting with the obvious – you’ll need a deposit to bring your home-owning dreams to life, but how substantial a deposit depends on the price of your home and how much you have the capacity to borrow.

Usually saving 20% of purchase prices plus other related costs is a good idea and means you’ll have less to pay off over the years.

Bonus tip? When prepping to secure yourself a loan, use an online calculator and an estimate of what you may borrow to see what your mortgage repayments could potentially look like. This can help you prepare mentally and also ensure that the homes you’re looking at fit within your means and budget.

Purchase Costs

  • Legal fees: These are the fees you’ll need to pay for working with a conveyancer or solicitor in the process of buying a home, and they’re estimated to cost around $1800 but this will fluctuate depending on where and what you’re buying and/or selling.
  • Building & methamphetamine inspections: These inspections are important, as they make sure that there aren’t any problems with the property that you or I wouldn’t be able to notice. If your home is older, this process is even more important.

Moving Costs & Furniture

Something else that often gets overlooked is the costs associated with moving all of our items into our new place, and the cost of the new furniture once we’re in there.

Of course, this can also be the one cost that you can save a lot on by recruiting family or friends with a truck or a trailer to help you move and making the most of second-hand marketplaces. But if removalists are required and if you’re a lover of having everything ‘new’ for your new home, then these are additional costs that you’ll need to consider beforehand.

Remember though that no one expects your house to be 100% Architectural Digest on day one unless you’re having Kris Jenner over for dinner. So when it comes to furnishing your home, you can take your time to factor all actual spending into your budget, once you’ve moved in.

Emergency Buffer

Always have an emergency stash that you can lean on should you run into trouble, in the instance when a bill costs you more than you’d originally estimated.

It can be hard to know “how much is a safe saving buffer”, but aim for a buffer that will cover you for at least two-three months of living expenses.

Saving and purchasing a home is super exciting, but comes with many added responsibilities that are important to be aware of, before popping your toe into the water too early. Have a question or would like some assistance to better understand the purchasing process, get in touch with us!