Published on January 17th, 2013
Process of buying real estate pt 1
When thinking that it's time to buy some residential property as either an investment or a home, it's important to consider a number of factors before you go charging into the nearest open for inspection.
Be sure to assess your budget before you start to research because it may turn out that the area you are interested in is outside what you can afford to pay.
Talk to a bank or financial institution to work out what a repayment would be on a particular loan and examine what monthly repayments fit in best with your budget.
Elders Real Estate state franchise manager Geoff White said that you should allow yourself a buffer with interest rates.
He commented: "Allow for potential interest rate rises so a buyer can handle a rise or two – some people say that they should allow for a two per cent increase.
"Rates rise and fall by fractions so even with that there is still a while before rates will rise by two per cent. With interest rates where they are now, you should think about paying more off than you're obligated to."
After working out what you are able to pay, Geoff said the next step is to research a specific area for an exact type of property. Potential buyers will have to think about the location they want to buy into in terms of proximity to work, shops, family and other amenities. He added that there is no point in comparing a two-bedroom unit by the water to one in a completely different area as it's important to compare apples with apples.
Geoff added that the internet is a good source for research because buyers can look at comparable sales and see what's available in their price bracket. Alerts can be set up with specific criteria to notify people on suitable properties they may otherwise miss.