Navigating the property market with real confidence is challenging, especially if you’ve never done it before. For first-time buyers, it can be a gruelling experience, and things can sometimes go wrong. Costs can escalate out of control.
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Fortunately, this post is here to help. We take a look at some essential strategies that you need to navigate the property market so you can feel comfortable in your decision-making. Here’s everything you need to know.
Secure full financing before applying
The first thing you want to do is secure full financing before applying to purchase any property. Once you have financing in place estate agents and sellers are much more likely to take you seriously.
The good news is that securing financing is usually relatively simple. Many lenders will provide you with an estimated amount of how much you could borrow in principle, based on the information that you send them. If you want something more rock-solid, you’ll need to make a formal application, get their team to check your bank accounts and pay slips, and then they’ll make you an upper limit on how much you’ll be able to borrow. You can then use this when deciding which property you want to buy.
Base valuations on recent comparable sales
Next, you’ll want to make sure that you’re basing all of the property valuations on recent comparable sales. Look for properties that are similar to the one that you want to buy in a local area and see how much they sold for. Then ask yourself what your target property is worth relative to them. Maybe yours has a slightly better bathroom but a slightly smaller garden, in which case one might upset the other. All you’re looking for here is a ballpark figure. If you’re not sure, then go to a valuation expert.
Assemble your due diligence team
Buying a property for the first time is risky because things can go wrong. Sellers can hide issues with their properties from buyers, which can create liability later on. You don’t want this. Instead, make sure you have a proper surveyor and, if there’s any risk of structural damage to the property, an engineer as well.
If you know about any structural damage and you’re prepared to live with it, then it can be important leverage when negotiating on price. Many times, sellers will acknowledge that there’s a problem with the property and lower the asking price accordingly.
Establish your strict walk-away number
Finally, it’s a prudent idea financially to make sure you establish a strict walk-away number. This is an amount that you won’t go over for any property, no matter how compelling it might be.
When buying a property, it’s easy to become emotional, and many people become attached to the new home that they want to live in. There are thousands of properties on the market, and many of them will offer you significant advantages over time, especially if you buy something that you can afford. If you decide to go on an unaffordable mortgage, it can cause long-term stress, which can damage other aspects of your life, like your relationships.
