7 First time home buyer mistakes to avoid

The process of buying your first home can seem daunting and overwhelming. If you’re not well equipped for this, it’s easy to make trivial mistakes that could significantly affect the homebuying process. To help you with this, here is a list of first time home buyer mistakes to avoid.

1. Don’t dismiss building insurance

In the home-buying process, it’s easier to get caught up focusing solely on your deposit. But it’s important to also consider the surrounding things that are needed such as building insurance. As soon as you purchase the property, you are liable for it. Therefore it’s worth considering buying building insurance as early as possible at your exchange and prevent delaying it until when you move in. The absence of building insurance means that if there’s an issue with the property once you buy it, you’ll likely get a big repair bill due to you having to fix it outside of insurance.

2. Know your budget before searching for a home

Whilst window shopping for homes seems nice, doing this without knowing exactly how much you can afford means you would be setting yourself up for failure. Doing this could cause you to be fixed on purchasing a particular property, only to realise later that it is way out of your budget. Getting a mortgage broker will help you decide realistically what properties are best to look at for your budget. They will assess the best mortgage deals for you on the market at the time of your property search. This will save you from wasting a lot of your time in the property search and help lay out a better plan for your home-buying journey.

3. Don’t underestimate your move-out day as a first time home buyer

If you are moving to your new home from rented accommodation, give ample time for your move-out date. Even if you have an exchange date arranged that is approved, give extra time for any unexpected mishaps. Last-minute things could pop up which may delay when you have to move-out of your current home. So you don’t want to risk becoming homeless due to not giving yourself extra time. Although not ideal, it’s better to be in a situation where you are paying for both your mortgage and your rental temporarily as opposed to being homeless because of an unexpectedly delayed exchange date or other circumstances. Give your landlord an over-estimated move-out date to stay in the safety zone for this.

4. Not researching the neighbourhood 

This can be an easy step to forget as there is a lot of focus on getting the property itself in the homebuying process. But it’s also important to research the surrounding area of the property you’re looking at too. There’s nothing worse than having nosey neighbours or living in a notoriously unsafe location. Google the history of the area or ask the estate agent when you’re at the house viewing. Also going to the area during peak times will help give you a more genuine feel for the neighbourhood. It also gives you the chance to speak to neighbours.

5. Not checking your credit score as a first time home buyer

Checking your credit score is a very simple step to help gauge what properties and mortgages you can afford. It is one of the things lenders will check and consider in the process of whether they agree to lend to you. You can avoid disappointment and wasted time by ensuring you and whoever you are buying property with have a healthy credit score that is attractive to lenders. A low credit score could make it difficult for you to qualify to borrow, further delaying your home-buying journey. 

6. Not doing a home inspection

If you are eager to get your property, it’s tempting to dismiss processes like home inspections before you purchase. However, a home inspection provides a thorough opportunity to investigate the home to see if there are any red flags or things you should be aware of before moving in. As it’s carried out by a professional, it protects lenders and buyers in circumstances where there is a serious issue with the home’s structure or other core elements. Missing out on this key part could be detrimental.

7. Spending all your savings as a first time home buyer

Again, the deposit is often a hyperfocus when planning to buy a home. But you will still need extra funds to get other essentials for your property. Making sure that as you plan to buy a home, you are also planning for extra savings helps ensure you won’t be left out of pocket if unexpected expenses arise. 

Want more advice on first time home buyer mistakes to avoid? The Homebuyers Club is a community helping first time buyers on their property journey.