Despite the obvious pressures decreased housing affordability has on people’s ability to become first home buyers, buyers of all generations have had to make compromises when buying their first home. Having a firm grip of your finances, your budget, your expectations and your lifestyle will help you navigate what is most important to you when buying a property. Here are the dos and don’ts of what you should compromise on when choosing your first home.
The Do’s and Don’ts of Choosing Your First Home
DON’T compromise on your time. Are you really willing to commute 2 hours in the morning and 2 hours in the evening for 5 days of every week? If it sounds like torture, it may not be worth it. If you don’t have a family and can be productive during these hours, such as while on a train, then it may be a feasible option, but do picture the reality of commuting for an extended period.
DO compromise on space: if you don’t need the extra bedroom, go without it at this stage, especially if it means you improve your location, and even more so if there is room to renovate and create space in the future.
DON’T compromise on built quality/structural integrity when choosing your first home. If it is the land you are interested in, and it is an investment property that you are buying as your first property, then that may be one of the few instances where the quality of the build isn’t as important. Otherwise, you may find yourself spending extra money on a series of repairs if your home isn’t up to scratch.
DO compromise on your garden. Especially if it means increased space inside. You can make the most of local parks and you may find that you end up outside more and having a greater interaction with your local community if you head to your local parks for a bit of greenery
DON’T compromise on checks and balances. When buying a home ensure you have professional support to help you make the most of your savings and avoid any costly mistakes. Develop strong working relationships with key pillars of support, such as a building surveyor, solicitor, and an accountant. A buyer’s agent may even be able to help find a property that limits the need to make too many compromises.
DO compromise on room size. As long as you aren’t living under the stairs like Harry Potter, consider monopolising on storage solutions so that you can compromise on the size of, for instance, your bedroom. If you do compromise on the size of a room, do not compromise on natural light or windows. These will help create a sense of space.
DON’T compromise on your budget. The number one mistake you can make is to spread yourself too thin. Be sure of what you can afford and scrutinize any mortgage lender’s attempt to enter you into a high-risk financing solution, such as an interest-only loan or taking out Lender’s Mortgage Insurance, if it means you have little cash flow left.
DO compromise on your tastes. You may not get your dream home first time around. Just ask older generations whether their first home was their ‘dream’ home. More than likely they bought it on a shoe string and had to put up with that leaky roof for at least a year. Your parents have probably only just moved into their dream home. It’s a serviced apartment in Noosa. If you find your home a little ugly for a while, remember that it isn’t forever and there are countless others locked out of the property market.
DO/DON’T compromise on the most obvious of luxuries: location. You have a choice of whether you wish to invest in a better location or a better house when choosing your first home, and there are a whole range of factors that will affect your decision. This depends on your lifestyle, the nature and location of your work, and your future plans for the house. Will you turn it into an investment property? Do you want to renovate it? Are you concerned about capital growth? If you want to sell the property within 5 years, you may want to compromise on comfort and invest in a home within an area where capital growth is substantially higher than further out.
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