WHAT YOU NEED TO KNOW BEFORE PURCHASING A PROPERTY

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Property investment often marks a significant milestone in an individual’s financial journey. The process involves a number of complexities and demands meticulous planning. That’s why it is important to equip yourself with relevant knowledge before venturing into the property market. In this guide, we’ll discuss the factors to consider before making your property purchase.

PROPERTY OWNERSHIP AND INVESTMENT STRATEGY

The purpose of your property purchase can shape your buying decision. Ask yourself:

  • Are you buying to live in the property or as an investment? 
  • Is this property a short-term flip or part of a long-term strategy? 
  • If it’s an investment, have you considered rental yield, management costs and capital growth potential?

UNDERSTANDING YOUR FINANCIAL POSITION

Before exploring property listings, take a look at your financial position. A thorough financial assessment involves understanding your:

INCOME: Your regular income will dictate your borrowing capacity. It includes your salary, income from investments or any other regular source. 

SAVINGS: The amount you have saved will determine the size of the deposit you can afford.

EXISTING FINANCIAL COMMITMENTS: Do you have ongoing loan repayments or credit card debt? Such liabilities might reduce the amount you can borrow. 

CREDIT SCORE: A good credit score is essential as it impacts the types of loans and interest rates available to you. 

BUDGETING AND PRE-APPROVAL: After knowing your financial health, you can set a realistic budget for your property purchase. Your budget should account for not just the property price but also associated costs like:

  • Stamp Duty
  • Solicitor Fees
  • Building and Pest Inspections
  • Moving Expenses
  • Further, acquiring a pre-approval for a home loan before you begin your property search can help set clear boundaries. Pre-approvals are usually valid for 3-6 months and help identify your borrowing limit.

CHOOSING THE RIGHT PROPERTY

Finding a property that aligns with your budget and lifestyle preferences is a process. Here are factors to keep in mind:

LOCATION: The location of the property affects your quality of life and the property’s future value.
PROXIMITY TO AMENITIES: Consider the property’s distance to shops, restaurants, parks, hospitals and other facilities. 

PUBLIC TRANSPORT AND SCHOOLS: For families and commuters, proximity to schools and public transport could be important. 

POTENTIAL FOR CAPITAL GROWTH: Look at market trends, planned infrastructure or developments that could enhance the property’s value. 

LEGAL CONSIDERATIONS AND INSPECTIONS

Buying a property is a significant commitment. So, ensure it’s free from legal or structural problems. Key steps to include are:

LEGAL CHECKS: A solicitor can help conduct necessary checks on the property title. 

BUILDING AND PEST INSPECTION: A comprehensive building inspection can reveal hidden issues such as structural defects, pest infestations or maintenance concerns.

CLOSING THE DEAL

When you find the right property, it’s time to close the deal. You can follow these steps:

  • Make an offer or bid at auction. 
  • Don’t shy away from negotiating on price, terms and conditions.
  • Ensure you have final loan approval and enough funds for the deposit and costs before signing the contract.

SEEKING PROFESSIONAL HELP

Navigating the property market can be challenging. Hence, seeking professional help, such as that of a real estate agent, can be beneficial. They can:

  • Help find properties that fit your budget 
  • Provide valuable market insights 
  • Guide you through the buying process 
  • Assist with price negotiations

TRUSTED REAL ESTATE AGENTS IN MACKAY

If you need professional assistance, reach out to us at Hugh Reilly Real Estate. Our team has local knowledge and industry expertise to support you at every step, ensuring a smooth and stress-free property buying experience.

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