Tips For First Home Buyers

Buying your first home can be both exciting and daunting.

If you are a first home buyer and your head is spinning right now, don’t worry. The following checklist will help to restore clarity and calm so that you can relax and enjoy the exciting process of becoming a home owner for the very first time.

At this point you may have more questions than answers, such as:

- How much deposit do I need to buy a house in South Australia
- Am I eligible for a first home owner grant?
- Do first home buyers pay stamp duty in South Australia?
- How do I choose theright property?

They are all great questions, so let’s provide some answers and some trusted resources to help you access the right information when buying your first home in South Australia.

The first step for anyone buying property, not only first home buyers, is to speak to a mortgage provider about how much you can borrow, how much deposit you need and how much your repayments will be.

Typically, you’ll need to have saved a 20% house deposit, and while you can sometimes pay less deposit, it usually requires lender’s mortgage insurance which comes with a fee.

TIP: Having your ducks lined up FIRST means you can begin the house hunting process with confidence and pre-approval to spend up to a specific amount.

Woohoo – your finance is sorted so it’s time to start looking! But who knew there were so many options when buying your first home? Should you buy land and find a builder or buy a house and land package? Is it better to purchase an existing unit, a townhouse, an apartment or a freestanding (Torrens title) home?

The answer may be about what is best for your lifestyle and your finances, but it is also important to consider the location of your first home.

While you won’t be eligible for a first home owner grant, buying an established property in a location experiencing strong growth can bring long term financial benefits.

Building a new home provides all buyers with the opportunity to save on stamp duty costs because stamp duty is payable on the land value only. And in South Australia first home buyer grants are only applicable to new homes, so it may be a good option for you.

TIP: You might find our blog on How To Choose The Right Property For You helpful.

When you find a home you like and can afford, a building inspection is really important. Registered building inspectors will provide a detailed report regarding the structure and condition of the home. It lets you know if a property needs costly repairs to things you may not be able to see like leaky roofs, termite-infested floors, unsafe wiring or sinking foundations.

TIP: If the property does need repairs but you still want it, you can make a lower offer that ensures you have room in your budget for the cost of the repairs.

You’ve found it! The home you LOVE! Before making an offer, make sure you’ve chosen a registered conveyancer or solicitor so that the legal documentation process can be managed immediately by legally qualified experts.

In South Australia an offer to buy property on the market must be made in writing. The vendor’s real estate agent will provide a contract for you to complete and sign.

The real estate agent will present your offer (along with any others) to the vendor. If it is accepted, a penalty-free cooling off period will begin and finish after two clear business days.

Once the cooling off period has expired you are required to pay a deposit. At this point the contract of sale becomes legally binding, subject to the conditions therein.

TIP: Your offer should always include any conditions it is subject to, such as final finance approval and a building inspection, and stipulate a timeframe for settlement.

Settlement is the date upon which all conditions that the contract of sale is subject to have occurred, and the property officially changes hands from the vendor to the buyer. As the buyer, settlement means it is time to collect the keys, pop open the champagne and celebrate becoming first home owners!