Buying a home? It can be an exciting—and overwhelming!—process, especially for first time buyers deluged by unfamiliar processes, big decisions, and what may often seem as too many choices. Here are 4 ways to make it easier.
1. Set a budget
As a general rule, your monthly mortgage payments shouldn’t exceed 30% of your monthly gross income. However, other things have to be considered. Is your income stable? Do you expect your expenses to increase dramatically within the next few years (e.g., you’re planning to have a bigger family)?
Don’t forget the incidental costs of buying a home, often underestimated by first-time home buyers. This includes the conveyance fees, repairs, home owners insurance, council tax, even boiler maintenance. Also consider the various expenses from moving to, and settling into, your new neighborhood (transport, furnishings, connection of services, etc.).
Your budget should also include a savings reserve of 6 months’ worth of mortgage payments and household expenses—best to be prepared for any emergency.
2. Find a conveyancer.
A conveyancer is a solicitor who specializes in the paperwork, negotiations and other legal niceties of real estate transactions. This includes preparing and reviewing contracts, negotiating with the seller’s conveyancer, and making sure your interests are protected (including checking the value of the property, evaluating for any health hazards, and informing you of any requirements and how to get them).
A conveyancer can walk you through most of the details of buying a home. That’s why you need one, and also, why you should choose someone you’re comfortable with--you can ask questions, freely raise concerns, and trust him to give you the service you deserve. That’s why going to a company that specializes in real estate is better rather than one where solicitors handle different types of cases.
3. Define your preferences.
You’ll be looking at a dizzying number of houses, none of them perfect, and all of them beautiful in their own way. So how do you finally choose which one’s worth buying? Aside from the price tag, consider:
• Size and structure. How many rooms? Do you want a garden? How important is privacy?
• Location. How close is it to your office, the schools, the shopping centres, the airports? Remember to compute the change of transportation costs into your household budget. Consider also broadband access, ease of public transportation, and how future constructions will affect property value. Your conveyancer can also double check if your property is sitting near any roads that the city is planning to build.
• Condition. How much will you need to spend on repairs? Your conveyancer can arrange inspections to help you assess the real cost, and can use this to negotiate the selling price.
• Safety. Be sure to drive around the area at night, and check the Internet for statistics on crime rate. Note that living in an unsafe neighborhood can affect your insurance premiums.
• Health. Nearby chemical or processing plants can affect the soil and water. Your conveyancer can help you arrange for the necessary tests.
• Style. Modern or historical? Cozy or elegant?
• Resale value. Like any investment, your property should ideally increase in value over the years. But aside from these forecasts, factor in how easy it will be to sell the house when the time comes. For example, homes located near schools will always appeal to young families, so you won’t have any trouble finding a buyer. So it would be rather suspicious if the house you’re planning to get is too cheap. If the owner is selling below market rate, the property may not be as attractive as it seems.
4. Delegate, but stay in control.
Hiring a conveyancer takes a lot of the details off your hands, so you can focus on the more enjoyable aspects of buying a home—like picking new furniture, or planning your housewarming party. But you still need to stay on top of things. Some tips:
• Don’t hesitate to ask your conveyancer for any updates.
• Keep track of all your expenses in a small notebook.
• Buy an expandable folder for receipts and documents. Be sure to make photocopies of any important papers.
• Shop around for the best deals on mortgage or insurance, and weigh the sales hype against the credibility of the company and an assessment of your own needs and financial situation. Your conveyancer can help you look at their proposals to check for any legal loopholes.
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