Buying your first home can be a very anxious decision for some first home buyers. As one of the largest financial decisions you will make in your life, how do you know when you are ready to buy a home? Here are 3 things to consider that will help you determine if you are ready to become a homeowner.
Are you ready to settle down?
Purchasing a home is not as easy as buying new clothes or accessories. It’s not a spontaneous decision that can be made in a split second – without worrying you, it’s a decision that will either positively or negatively impact your future. If you are considering buying a home, it is important to think about your employment and location.
If you’ve been working in the same industry for a while now and don’t see yourself moving any time soon, you’re in luck! Those who are employed full-time and have been with the same company for more than 1 year are considered (by finance institutions) to have a stable income.
- How do you get to work?
- How long does it take to drive to work from your current location?
- How much of an impact will commute times have on choosing a location for your new home?
If you are planning on staying in the same city and have no immediate plans to move cities or interstate, buying a home will serve numerous long-term benefits.
Employment and location are perhaps some of the most important factors to consider when thinking about home-buying. Being a full-time employee at the same company who is not looking to relocate will put you in the best position to access long-term housing stability. But of course, if this description doesn’t fit your situation, there are ways around.
You may think you can easily afford to own a home if the repayments are a similar cost to what you currently pay in rent. However, the principal and interest repayments for your home loan are not the only costs associated with owning a home.
Expenses such as home insurance, electricity, council rates, water, sewerage and garbage are all costs you will have to pay as a homeowner. If you already struggle to pay your bills, buying a home may put financial pressure and stress on you.
A way to overcome this is to set yourself a monthly savings goal that is achievable. Start off with a small amount and work towards the big picture – owning your own home. Saving more might mean cutting back on unnecessary expenses such as eating out or clothes shopping, but every cent counts.
If you can comfortably afford all home expenses that are relevant to your home or are able to save consistently, you may be ready to own a home!
Fixing all the leaks
When you rent a property, the property manager is in charge of finding a repairer to assist with any maintenance issues such as fixing breakages. For your own home, the reins will not be passed over. You will be responsible for the maintenance and basic house upkeep. You need to have the ability to fix the problems yourself or use resources to pay others to fix them. If you are a handyman and good at fixing issues that can occur in a house, you can save on the cost of labour. But, the cost of material can still be expensive, and you may need to dip into your savings as soon as an issue occurs to avoid a greater issue from occurring.
Although the thought of affording and maintaining a house might seem daunting, it is an exciting time and something to look forward to! Whether saving isn’t your forte or you’re not the best handy man, there are plenty of resources to assist you on your journey to homeownership.